Over the past few years, a trend toward investing in genuine, local experiences rather than purchasing goods has gained momentum, and this has significant ramifications for the travel sector.
“That momentum will continue to accelerate, in turn making the impact of travel and tourism on global economies that much more significant,” says At the Global Summit 2022 of the World Travel and Tourism Council in Riyadh, Saudi Arabia, Anthony Capuano, CEO of Marriott International, participated in a panel discussion.
Greg O’Hara, founder, and senior managing director at private equity firm Certares said that consumers are now spending a larger percentage of their discretionary income on experiences and activities than ever. O’Hara responds that he would spend $1 billion on adventure and wellness.
In the past, people would choose to travel to places like Greece, Italy, or Saudi Arabia before deciding what to do. Nowadays, “people are making decisions about travel based on what they want to do, not where they want to go,” According to O’Hara, someone who wants to go kiteboarding, for instance, will select from the best kiteboarding locations.
Sandiaga Uno, Indonesia’s minister of tourism and creative economy, claims that the new trend in travel is more individualized, regionalized, customized, and compact in scale.
“We need to change the mindset to quality and sustainability,” Uno says.
If travelers previously wanted sun, sea, and sand, now they’re looking for “serenity, spirituality, and sustainability. To lessen their carbon footprint, they plan to try planting mangroves. They want to go to villages.”
According to Sébastien Bazin, chairman, and CEO of Accor, the market needs to recognize that every customer is unique and that every offer should reflect that.
“You just have to revisit the way we’ve been conducting business the last 50 years to a new world, which I think is a better world,” he says.
Hotels should provide entertainment, music, and workspaces for locals rather than tourists.
“That’s a major shift,” Bazin says. “Make sure there is an activity in your hotel from 7 in the morning to 11 at night.”
While 25% of international business travelers are “gone forever,” domestic business travel has recovered, according to Bazin.
“If you go for business [on a] less than four-hour flight or four-hour train ride, it is as strong today as it was in 2019,” he says.
Business and vacation trips are frequently combined. Due to people combining business and pleasure travel, Bazin observes, hotels are no longer deserted on Sunday nights.
The industry needs a strong infrastructure, including charging networks, and Stephen Scherr, CEO of the Hertz Corporation, says that public-private cooperation is necessary to build that infrastructure.
The looming recession can’t possibly hit the travel industry as hard as the pandemic, Scherr says, and the industry is better prepared for crises now “because you understand how to marshal the resources and what your moves will be.”
According to Gloria Guevara, chief special advisor for the Saudi Arabian ministry of tourism, nations need the vision, the leadership, and the resources to maximize their recovery.
“I was very fortunate to have that in Mexico,” Guevara says. “To recover from the crisis and set new records, we had a national agreement, and everyone was working toward the same objectives under the same plan.”
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