London,
24
April
2020
|
10:00
Europe/London

LOTUS CORONAVIRUS UPDATE (23.04)

THE REFUND ISSUE

No Government response…yet

As the travel industry fights for survival, Government has still not provided any response to resolve issues on refunds, despite media speculation that it would.

A Sunday Telegraph report that the sector was in line for a £4 billion government ‘lifeline’ to fund consumer refunds raised the pressure but was dismissed, says Travel Weekly, as “ludicrous” by senior industry sources, as operators and agents struggle to make repayments and consumer anger grows. Consumer publication Which? added to the pressure on Wednesday when it accused “the UK’s 20 biggest travel operators and airlines of openly breaking the law on refunds” and argued: “Credit notes may prove worthless.”

ABTA has guaranteed Refund Credit Notes against insolvency and confirmed Atol-protected bookings will also remain protected. One source told Travel Weekly: “There may be clarity on this issue in the coming days which would allow the CAA to expand on what is acceptable in terms of Refund Credit Notes. People understand the industry is vulnerable and nobody wants to push businesses over.” A second, senior source said: “We’re not expecting any change to regulations because of lobbying by consumer groups.”

Which? launches a 10-point plan

The consumer campaigning body Which? launched a 10-point plan for ‘maintaining trust in travel’ yesterday. TTG reported that Which? outlined the financial pressures facing both consumers and the travel industry and said “the Government must work urgently with the industry regulators to address this unprecedented challenge head on and ensure that passengers who are now unable to travel are not left out of pocket, and that their consumer rights are upheld.” The plan included the points consumers must be offered a cash refund when their flight or holiday is cancelled and that a credit note/voucher may be offered as an alternative but not the sole option when a flight or holiday is cancelled.

Today’s Times also reports on how consumers, who have contacted the paper, feel that tour operators have blocked refunds and told them to access refunds through insurance companies – and put a figure of £7billion on unpaid refunds. Today, travel trade media reported that VIVID Travel has resigned its ABTA membership over the refund issue.

 

SOCIAL DISTANCING

As the Chief Medical Officer told Britain that it needed to prepare for another year of “disruptive” social distancing measures, UKHospitality reiterated its call to the Government for further intervention for pubs, restaurants and hotels, which CEO Kate Nicholls said was disastrous for the sector and, as reported by the BBC, told the treasury select committee that a third of the sector was under threat. A look at consumer confidence in The Times also finds the hospitality industry most exposed to a difficult recovery.

Earth Day  

Marking Earth Day, The Times comments today that recovery from Covid-19 should build in consideration for environmental health along with a reduction of fuel consumption, with which we have already managed to live.

Shannon Guihan, chief TreadRight Officer, The TreadRight Foundation also provides a comment in Travel Weekly. “While we prepare for the world to re-open, we can use this collective time of pause to consider how best our industry can and should manage the return of travel, and what we can do better once the world starts to turn again. Earth Day feels like an appropriate moment to reflect on the kind of meaningful travel experiences that we should offer to our clients and the type of travellers that we ourselves, as impassioned explorers of this amazing planet, wish to be. More importantly, in my opinion, will be the way that the industry behaves through its operations and while in destination.”

 

RAIL

The Times reports that the rail union TSSA last night claimed that Network Rail was planning to increase rail services between 11 and 18 May. In response to the claims, Mr Raab said: “This is not a government timetable.”

 

HOTELS

Hotels up cleaning standards

Business Traveller has reported that Marriott International and Accor have announced new cleanliness protocols. Marriott has launched a Global Cleanliness Council to promote higher standards of cleanliness in the age of Covid-19. Technology in the form of electrostatic sprayers with hospital-grade disinfectant will be used to sanitise surfaces in rooms and public areas. Accor has partnered with testing, inspection and certification bureau Bureau Veritas to develop certifications for cleaning protocols.

 

TOUR OPERATORS

Travel Weekly reported that new enquiries for worldwide holidays in 2021 have picked up in the past week, according to Kuoni.

The operator has started receiving interest and bookings for next year as people in coronavirus lockdown use the time to plan holidays.

 

AVIATION

Recovery may be three years away, says Delta

Skift reports that Delta Air Lines CEO Ed Bastian has warned analysts that air travel will not rebound to pre-pandemic levels for another three years. During the company’s first quarter earnings call on Wednesday he said: “Demand for near-term air travel dropped to almost zero in a matter of weeks.”

But when travel starts to return, Bastian predicts Delta will be a different airline. “Safety will not be limited to flight safety, but [will expand] to personal safety,” Bastian said. “People will pay a premium on service excellence like never before.”

Flights, which before the pandemic were operating 80-90 percent full, may only be 65-70 percent full. Although Bastian did not speculate on whether airfares will rise, he stressed that the airline will be “different” than it was even 60 days ago and will focus on a premium experience, inflight and in airports. “I firmly believe people will pay for premium service.”

Air Mauritius

The travel trade media have reported today that the airline Air Mauritius has gone into voluntary administration as a result of the impact on demand caused by the coronavirus pandemic.

 

CRUISE

Repatriations

Travel Weekly reports that the UK Foreign Office has completed the repatriation of 19,180 UK cruise passengers who were overseas as coronavirus was declared a pandemic. More than 20 international governments as well as cruise operators and the military were involved in the operation.

CLIA: 139 jobs lost a day

In interviews with TTG and Travel Weekly Andy Harmer, UK and Ireland director for CLIA, said that for every additional day cruising is suspended owing to the ongoing impact of the coronavirus pandemic is likely to cost the UK economy 139 jobs.

Travel Weekly has reported that more than 5,500 UK jobs could be at risk as the result of an extended shutdown of the cruise industry.

The warning from trade body CLIA came as all lines continued suspensions and less than 24 hours after Fred Olsen Cruise Lines announced an indefinite cancellation of sailings by its four ships beyond 23 May.

CLIA’s Andy Harmer said: “The cruise industry generates £10 billion for the UK economy each year.”

He added: “Choosing to suspend operations was the right thing to do, and we know the cruise industry is resilient.

“We have put public health at the heart of our response, and we will continue to respect the guidance from international and national health authorities.

“We are using this time to enhance further our protocols that we will all benefit from, and we look forward to playing our part in the recovery, when the time comes for society to travel once more.”

RCCL launches new Coronavirus hub for agents

TTG has reported that Royal Caribbean Cruises (RCCL) is set to launch a new online information hub for UK and Irish trade partners to support them through the coronavirus crisis.

RCCL Cares will offer information ranging from the latest advice from the Government and Abta to trade FAQs, and up-to-date contact details for its sales support teams.

It will also provide the latest corporate messaging from RCCL, parent to Royal Caribbean International, Azamara, Celebrity Cruises and Silversea Cruises, as well as details of the group’s Cruise with Confidence policy.

 

DESTINATIONS

Spain

The Sun and The Times report that the Government of the southern Andalusia region, which is home to many of Spain’s most popular beaches, is considering plans to guarantee social distancing by marking off areas around people, which would be monitored by police.

Research suggests that Spain is set to suffer from the crisis more than any other European economy. Tourism is its third biggest industry, contributing 12 per cent of GDP and providing 13 per cent of all employment.

Asking parliament to extend the country’s state of emergency until 9 May, Pedro Sánchez, Spain’s socialist prime minister, warned that the process of easing the country’s strict lockdown rules would be “slow and gradual”. The Government has already eased some restrictions, including allowing some people to return to work last week and giving permission for children to go outside from next weekend.

Reports state that the autonomous community of Andalusia has been one of the least affected by the Covid-19 pandemic as there have been 11,689 cases in the region, representing 5.6 percent of the total in the country.

Tenerife

The Sun reports that in Tenerife, tourists will not be allowed back until at least October according to island bosses.

Regional government chiefs say the plan is to open hotels in July or August for Spanish holidaymakers before receiving foreign tourists in autumn.

Canary Islands’ president Angel Victor Torres has told local press: “The Canary Islands were the first to have coronavirus in Spain and now we want to be the first out of confinement.”

Today he said the reactivation of international tourism was the third phase of a recovery plan based around Canary Islands’ residents first and mainland Spaniards second.

Balearics

Travelmole, The Sun and The Times have reported that The Balearic Islands could still open for holidaymakers this summer, but tourists from the UK won't be invited. Trips to Ibiza, Majorca, Menorca and Formentera are off the cards for Brits because the country waited too long to go into lockdown.

According to the Balearics Tourism minister Iago Negueruela, the local government is expecting the islands to remain closed in May, June and July due to the coronavirus pandemic. But they are cautiously optimistic about opening up in August, with 25 per cent of their usual visitor numbers.

Mr Negueruela said: "There are countries like the United Kingdom that have taken too long to adopt containment measures and that also puts us in a different situation with respect to them."

China

Hotel occupancy 70% in Hainan

Digital tourism marketing agency that specialises in Chinese outbound tourism, Dragon Trail, reports that it was expected that Labour Day - 1 May - would herald a period of outbound tourism rebound, but the recovery in tourism is domestic for now. Hotels in China’s Hainan Island province are reporting occupancy rates of 70%.

Chinese tourists stay engaged with tourism

Dragon Trail also reports that most tourism verticals and leading accounts saw an increased readership on WeChat during Q1 2020, showing that Chinese tourists stayed engaged and turned to WeChat for travel information and inspiration even during the peak of the crisis. The details of this report can be found here: WeChat Rankings Report.

Switzerland: Dream Now, Travel Later

Dragon Trail interviewed Simon Bosshart, Director China and Director Asia Pacific for Switzerland Tourism about digital marketing and its successful ‘Dream Now, Travel Later’ campaign, which gained great engagement. Switzerland has been a market leader in attracting Chinese tourism and was equally early to market Coronavirus messages as China was the first country to impose lockdown. Switzerland started its campaign in late January, early February with a China-friendly position with regards to cancellations.

Chinese sentiment post-virus

Dragon Trail has translated the China Tourism Academy report on tourism sentiment post-virus which found:

1) Travel was one of the leading topics that people cared about during the virus, and demand is still high

2) Travel should rebound again starting from the 1 May Labour Day holiday. 43% of survey respondents said they would travel between March and June, if the virus crisis is resolved.

3) When asked about their goals for post-virus travel, 30% chose relaxing holiday, 24% chose sightseeing and tours, and 9% chose culture and education.

4) Most respondents said that their first form of travel after the virus would be domestic, with most sticking close to home.

5) Nature travel has major appeal for Chinese travellers now (21%), but city sightseeing is still popular (20%).

6) What will motivate Chinese to travel in 2020? Safety is key (20%), though discounts and promotions are important, too (travel agency promotions 18%; discounts on attraction tickets15%; discounts on airfares and hotels 10%).

Trending Topics on WeChat and Weibo – April

April's social media content from international tourism brands looks like a return to "normal" in many ways.

  • Hotels are pushing promotions like cheap upgrades, discounts, and coupons.
  • Cruises are offering deals, and the MSC Bellissima still plans to make its maiden call in China this June.
  • Tourism boards of Thailand, Japan, Macau, and Germany are all publishing food-related content.
  • After being nearly silent for all of February and March, Tourism New Zealand's popular WeChat account is back to a regular posting schedule.
  • Airlines' content, however, tells a different story – almost all of the top posts in that category are still about extensions of route suspensions, and cancellation and ticket change policies.

The Times reports that Beijing will open sports facilities for public use within weeks. Residents will be able to take part in athletics, table tennis, badminton and tennis as long as the outbreak remains under control. Football fields, basketball and volleyball courts, as well as judo, taekwondo, wrestling and Chinese boxing venues would remain closed. All users must have their temperatures taken, provide personal information and wear masks before they enter the sports facilities.

It also appears increasingly likely that China’s national congress will meet for the first time via video link at the end of this week. Two Chinese provinces, Zhejiang and Shanxi, have announced plans to hold their annual congresses in a video format. The national congress is expected to convene from Sunday onwards.

Austria

Strict quarantine measures in Austria have been relaxed. The lockdown is slowly being lifted, with shopping centres and hairdressers being allowed to open from 1 May, but tourists won't be allowed back to the country until the summer. British tourists may find themselves unable to visit the country until after the summer, depending on the way the virus is handled.

Vietnam

One of the first countries to report Covid-19 cases in January, is now easing restrictions, many of the national papers report today. The Telegraph say that the country is an under-reported success story. The country took swift action which was based on a robust pandemic response plan that was forged after recent brushes with other high-risk infectious diseases, including SARS and H151.

Vietnam started to lift the strict movement and social distancing restrictions still in place in many of the neighbouring nations. The Vietnamese strategy focused on a combination of targeted, rigorous contact-tracing and testing to swiftly contain small clusters of Covid-19 before they spread further.

Brazil

The Times has provided an update of Covid-19 developments around the world and reports that Manaus is handling about three times the average number of burials a day. As a result, mass graves are being dug and local health systems are being overwhelmed and the toll is reportedly taking a higher toll on indigenous tribes.

Australia

Australia’s Prime Minister has suggested the WHO should have powers to enable it to enter countries without invitation to investigate sources of pandemics.

South Africa

More than 73,000 additional soldiers will be deployed to the streets in South Africa to help enforce the lockdown, one of the world’s strictest.

Japan

At least 48 crew members on board an Italian cruise ship docked in the Japanese city of Nagasaki have tested positive for the virus, the authorities announced today amid reports from the BBC that cases of Covid-19 have increased in Tokyo due to mixed social distancing messages.

Belgium

The country has published an exit strategy and lockdown measures will ease from 4 May – aviation will not be allowed.

Turkey

A four-day full lockdown in 31 cities will start from midnight tonight to prevent people gathering to celebrate the start of Ramadan.

Turkey has one of the fastest-growing number of Covid-19 cases, with 95,951 confirmed. The death rate appears to be lower than in other countries, at 2,259 deaths, although comparisons of this year’s death data with previous years suggests that there has been a more significant increase than the official data shows.

France

Half of private sector workers in France have been laid off during the coronavirus lockdown and are now benefiting from an extended indemnity programme, the Government said today.

Wanderlust

Wanderlust has created an article which they will update daily to share which borders are closed, and where in the world is still open to travellers...

Yesterday, they report that the Azerbaijani authorities have extended the suspension of all commercial passenger flights in and out of Azerbaijan until at least 4 May; Croatian authorities announce they are extending the closure of their land borders until 18 May and Montenegro has slowly started to ease its lockdown.

 

DESTINATIONS AND MARKETING WEBINAR

As part of its Travel Path Forward series, Skift ran a Destinations and Marketing panel on 22 April that gathered opinion from Skift editors, research analysts and leaders in tourism. Findings included:

Puerto Rico

Brad Dean, CEO of Discover Puerto Rico, said that it was encountering both health and economic crises, but GDS bookings are picking up with group bookings beginning to trickle in this week for 2021.

There is a concern that despite consumers wanting to travel, they fear that they might not be able to afford it.

Dean outlined the importance of DMOs to support the trade. Puerto Rico has enrolled more agents for training in the last month than last six months of the year and they have sent Puerto Rico coffee to meeting planners. Google search for Puerto Rico has increased year-on-year in one in three destinations globally.

Funding is facing massive disruption and the tax-only model doesn’t work and bold changes are needed. DMOs need to demonstrate the value that they provide for the whole community not just hoteliers. Diversified funding is the answer. Salt Lake City has evolved to a community model and they are looking at destination sales taxes for residents.

Florida

Staci Mellman, CMO of Visit Florida, said that the biggest concern for them is quantifying the economic destruction of the pandemic. The pandemic has exposed the fragility of the industry. Tourism is the most consequential types of business.

Tourism is the top economic driver in the region and so far they have seen $1.6bn in lost hotel income since March.

The unknowns are the biggest challenge and they are working hard to model recovery/scenario plans but with so many unknowns, it is hard to provide accurate outcomes.

Desirability is still there, but they need to ensure visitors and the community feel comfortable travelling

To move forward and stay relevant when looking at recovery, there is a need to work on how tourism can evolve.

There is an expectation that tourism should add value to communities and there is a need for stakeholders inside and outside the industry to be unified in this goal. Mellman outlined the need to be flexible, react effectively and engage digital platforms more.

The funding models for 95% of US DMOs is from accommodation tax which right now is non-existent and devastating. DMOs are examining other models.

Traditionally, accommodation taxes have been appropriate but yearly budget battles are not setting them up for success. They believe they need models that achieve collective goals on a more long-term basis. Optimistic solution would be to set funding based on goals. Diversified funding models is the answer but what that looks like is unclear. No funding means no promotion.

Greg Klassen, Twenty 31

The principal of this consulting company said:

  • DMO funding means many staff have been furloughed and so there is no back up for recovery.
  • Scenario planning is based on when this will be over and he predicts change will be slow and recovery gradual.
  • Intrepid travellers, community travel (group golf/girls trip) and VFRs will be first to return if they have the money.
  • DMOs need to nurture their good relationships with partners such as tour operators so that they choose them automatically when restrictions ease
  • DMOs need to work with SMEs to help them to provide the best experiences
  • China offers clues to recovery, which is domestic only at the moment. We need to keep watching them as they will help us navigate what the future will look like (see above)!
  • Research and marketing should be clearly linked for DMOs
  • Many tourism boards have data-heavy reports from large management consultants and the key is to contextualise findings.
  • Turn key learnings into something actionable, engaging and storytelling.
  • Realign the story to inspire and create action

BrandUSA

Tom Garzilli, CMO from BrandUSA said they have funding to the end of this year and want to maximise budgets to stimulate bookings for 2021. Their focus is to keep the lights on for destinations.

Good messaging needs to be useful, relevant or entertaining. If it isn’t any of these things there is no point.

They need destinations to share great stories and they don’t believe woeful downbeat ‘we miss you’ campaigns work.

Skift also announced that they will launch a new business to help DMOs with stewardship to reinvent and recover their destinations.

Calls for co-ordinated approach for exit strategy

Emerging Europe reports on how The European Commission wants to see co-ordination between member states, to avoid negative effects. At a minimum, the Commission calls on member states to notify each other and the Commission in due time before they lift measures and take into account their views. The European Union has published suggestions for exiting lockdown.

 

CONSUMER SENTIMENT

Eurozone consumer confidence crisis

The Times says that consumer confidence in the eurozone has dropped to its lowest level since the financial crisis. In France, Italy and Spain, the European Commission’s gauge of household morale plunged to -22.7 for April, from -11.6 in March. The reading was below forecasts for -19.6.

Saga survey

Almost two-thirds of over-50s have voiced reluctance to take a cruise due to the coronavirus pandemic.

The figure emerged as part of a consumer poll for Saga which attracted more than 7,700 responses.

Metro Mail Media – Survey of Travellers

  • A travel survey of readers of the Metro and Mail found:
  • Three in 10 of MMM readers have already taken a holiday or short break in 2020
  • Two in five readers had already had to cancel travel plans due to Covid-19.
  • Four in 10 could miss out on a holiday this year as 7/10 took holidays in 2019.
  • 89% of those with holidays booked in 2020 are worried about cancellations

Mixed emotions about the travel industry

Experiences with travel companies are mixed, as is the reaction towards the industry. Readers sympathise with the unforeseen impact of the pandemic but are frustrated by their reactions. Whilst 3 in 4 say that consumers should try to be understanding and help companies during this time, an equal number feel not enough was done to contain Covid-19.

Travel Insurance

  • 1 in 5 didn’t have insurance on their cancelled trip abroad. 1 in 2 say that being covered by insurance is now more important than pre-Covid-19.
  • Half now believe that insurance is now more important to them

Plans for 2020 and beyond

  • 1 in 3 readers still hope to plan trips later in 2020 – rising to 41% between 16-34 year olds
  • 34% would consider booking for later in 2020
  • September is the most popular month for newly booked plans now.
  • 54% think UK restrictions will lift by September and 63% by year end. In general, the further away the destination, the less sure their readers are.
  • Brand health and reputation will become more important with 40% saying that they want to book with a reputable company claim that travel insurance, reputation and guarantees will be more important than they were in the past. This is driven by 55+ audience who want more reassurance. Interesting only 1 in 3 said the cost of a holiday will be more important than it was in the past

Holiday types and destinations

  • UK holidays are more immune to the impact of Covid-19 than holidays further afield.
  • Beach and city breaks are the most considered and have the highest 2020 conversion. Spa breaks and scenic holidays are the next highest for consideration in 2020.
  • Unsurprisingly, the holidays associated with Covid-19 are suffering the most negative perceptions. 67% of cruise considerers say that Covid-19 is having an impact on their current view on taking this trip. This figure is 62% for winter sports holiday considerers.

What content do they want to see from travel brands

Only 1 in 3 say they are not interested in reading about travel at this time, although the type of messaging they are open to depends on age and stage of refund process.

  • 37% are interested in domestic holidays and breaks
  • 35% are interested in discounts and offers
  • 33% are interested in refund policies
  • 16-34 year olds are 50% more interested in travel content at this time; are 45% more likely to want to read about long haul breaks, and 33% more interested in how brands are helping consumers at this time
  • 35-45 year olds are 20% more likely to want to hear about special offers and 19% more likely to want Covid-19 booking offers and guarantees
  • 55+ year olds are 20% more likely to want to read about UK holidays and 17% more likely to read travel insurance reviews

The survey concludes that readers’ travel plans are up in the air, but there is a strong undercurrent of wanderlust still flowing within audiences. In the short-term brands clearly need to be transparent, clear and helpful to help their customers navigate the crisis. Those that achieve this will then be better placed to be the conduits to get people back up in the air.

Evidence suggests that future travel for the UK is most likely to start in the UK, with a ripple effect over time as people feel more comfortable travelling longer distances. Guarantees, clarity and insurance will play a key role in reassuring consumers.

Five principles guiding Google’s media teams

Joshua Spanier is Google’s global marketing VP for media. He has shared five principles on how his teams are navigating Google’s campaigns through the Covid-19 outbreak.

  1. Context. Though this is a global pandemic, its impact is local. Guiding question: Is this campaign right, given the current context in a local market?

  2. Constantly reassess. As market dynamics change rapidly, we’re constantly reassessing campaigns, creative, and even our guidelines. Guiding question: Though we greenlit this campaign last month/last week/yesterday, is it still right for the context and moment?

  3. Creative considerations. In the spirit of reassessing campaigns, we’re finding that all kinds of creative elements need scrutiny right now. From tone and visual imagery to copy and keywords, the context of our media buys needs to be carefully considered. For instance, we don’t think slapstick humour is appropriate for our brands right now so we’re holding off on some campaigns that were funnier in nature. We’re asking ourselves these questions with every campaign, no matter the channel or size of spend behind it. Guiding question: Are all of the creative elements — tone, copy, visuals, keywords, placements — appropriate and relevant to this new reality?

…And Finally

Museum turns social media over to security chief during shutdown

This story actually hit in March but highlights how authenticity and individuality epitomizes what travelling is about.

As The National Cowboy & Heritage Museum in Oklahama closed its doors to the public to help prevent the spread of the Coronavirus, Tim, the head of security was given the extra duty of posting content on the museum’s social media accounts and quickly grew followers from 10k to 300k.