Nick Pilbeam, Divisional Director, Reed Travel Exhibitions, shares his thoughts on the impact of COVD-19 on the travel industry, the incredible response by his event teams, and his optimism for the future.
The Travel Industry is experiencing an unprecedented, historical downturn, with expert predictions of the industry shrinking in 2020 by 40%-60% – a sharp contraction at least six times the impact of the September 11th 2001 attacks. Travel & Tourism is one of the world’s largest economic sectors, supporting 1 in 10 jobs (330 million) worldwide and generating 10.3% of global GDP with 100 million jobs expected to be lost this year due to COVID-19.
The good news is history shows that the industry is very resilient and that despite terrorist attacks, wars, epidemics and the global financial crisis, travel sees strong recovery then settles back to its long term growth rate. Numerous independent industry surveys of business and personal travel sentiment support this and an early examples of this prediction is early post-lockdown travel behaviour in China where travel is at 47% and spend 69% of last year which are encouraging signs of recovery.
That said, we need to recognise it will take 2-3 years for the industry to get back to the 2019 global volume of travellers.
Market leading digital offerings
So how is the impact of COVID playing out in the Reed Travel Exhibitions world?
Our priorities at this difficult time are our people and our clients. As a global team, we spend a lot of time on individual and team well-being, team contact and communication whilst also having fun with quizzes and Friday cocktails! Where a show is postponed to 2021, we ensure our clients receive the earliest possible notice of the changes, deliver strong customer support from our teams and provide a clear and more flexible choice of options. Our client base has responded positively to this approach resulting in average retaining of c. 70% of booked revenues and cash collected to the 2021 event – something we view as extraordinary commitment from our clients who are experiencing extreme financial challenges due to COVID.
At very short notice, we have devised some fantastic, market-leading digital offerings for our luxury travel audience and meetings, incentives, conferences and events audience and most recently, our sophisticated and wide-ranging Arabian Travel Market virtual event delivering 15,000 meetings and the WTM Global Hub, thanks to fantastic support from our Marketing and Digital teams.
Proprietary customer forecasting tool
Due to there being no reliable sources of data to predict the future, RTE has developed a proprietary predictive analytics forecasting model based on a series of external (e.g. IATA, UNWTO, Oxford Economics, STR, IMF) and internal datasets (exhibitor buying behaviours during crises overlaid with recent buying behaviours) giving us a unique, data-led view of what customers may decide. The model has been early validated by clients buying in line with their predicted behaviour, so we are deepening and widening the use of this model – great work by Debbie Stephens-Romancuk, RTE Customer Insight Manager, who can share all the details with you!
The new normal
Our three big autumn Travel shows, WTM London, IBTM World Barcelona and ILTM Cannes plan to run and we are receiving a lot of support and encouragement from exhibitors, visitors and hosted buyers for these to go ahead. Challenges remain in planning events that follow emergent local government regulations, safety and social distancing standards. International events rely heavily on COVID-safe end-to-end travel for people to attend. It is great to see trusted quarantine-free “travel bubbles” emerging e.g. Australia/New Zealand with positive momentum in these expanding over time, opening up international travel as lockdowns progressively lift.
The “new norms” are emerging with air transport virus safety standards. Data shows that aircraft air management delivers very high level of airborne particle filtering; hotel companies are doing a great job at rolling out “stay-with-confidence” COVID-secure sanitisation programmes; and ground transport is following fast e.g. setting up screens between driver/passenger helping reassure our customers about the prospect of their attendance. For those that don’t want to or can’t attend, we are planning e-bridge digital offerings leveraging wider RX learning and tech options to ensure we can connect physical and remote attendees.
I do expect international travel events in the wider industry that are not #1 or #2 in their market won’t survive, as clients with exceedingly tight budget will prioritise investing in shows with strong ROI and organisers that will be in business tomorrow. RTE is well-positioned in terms of market leadership to capitalise on this with strong net promoter scores and customer commitment.
I remain optimistic about the prospects for this industry for the future! #wewilltravelagain