Wednesday, 25 May 2011

Is the travel industry in rude health? Or just doing a Nero and watching their industry burn?

By - Tim Gunstone

If the last 2 years have been hard for you as a travel professional, it’s been really hard for me as a publisher of travel conferences, news and research articles. In the hands of cost focussed (and I would say) short sighted CFOs, the industry limited their purchases of research, conferences and pretty much anything that helped you plan for a successful future ….this made life in EyeforTravel harder for a while.

But the first half of 2011 has seen a 100% turn around, dynamism and optimism is back and as a result all of our shows have grown. This belies my grim weekly reading of the Economist. So who is right, the seemingly dynamic travel industry? or the doom and gloom of the Economists?

Online travel: There’s no doubt about it, the online travel world is growing.  At our recent summit in London, Google’s Daniel Robb predicted that online travel market will grow by a massive 20% from 2010 to 2012 and be worth US$313 Billion. Mobile is another key area for change, 15% of searches now come via a mobile and travel searches on a mobile device are seeing between 130% to 180% YOY growth rates. The search landscape is in the process of being revolutionised and Social Media is proving a worthwhile place for the travel industry to sell its products. No wonder my customers, web savvy travel executives, seem to be enjoying life - they are stealing market share.

But what of the industry as a whole?  During the dramatic global recession of 2009, the European travel industry experienced a steep 10% decline in gross revenues, shaving some €26 billion off 2008 sales and ending the year at €232 billion. There has been some growth since but as flight prices go ever up and immigration officials get ever worse it’s very easy to become gloomy….but it is also incredibly exciting as new markets evolve and new customers emerge. Our show in Mumbai in October is hard to top if you want to meet upbeat travel executives and our Miami show in June has attracted far greater numbers from the Caribbean and Mexico than before, mostly from independent hotels. This is also true for the Eastern Europe market.

A shift towards new travel products in developed markets - it’s here we are seeing some great innovations. New methods of communication; innovative and effective ways to market to niche groups combined with the ever greater price transparency online has fuelled the growth of new travel products. Be it stay-a-home Glamping, house swaps or longer volunteer tourism holidays as well as lengthier bouts of independent travel. The products in travel are changing but the old ones are not going away.

So for now I am going to go with what my customers are saying and will expand the number of conferences and products we produce.  I am looking to run a conference on travel product development in November. 

Here is our latest free in depth report looking at what marketing and distribution channels are growing and which ones are shrinking. It covers all the global markets and splits into all the travel verticals. It can be downloaded at no charge here: