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Travel in 2010 and beyond (White Paper)

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17 Apr

Travel in 2010 and beyond (White Paper)

The ‘noughties’ was a landmark decade for the travel industry. New, far flung destinations such as Thailand, Vietnam and Mexico exploded onto the mainstream and previously exclusive destinations such as the Maldives and Caribbean became more accessible to the masses. Budget airlines changed the way that people think about their weekends, opened up a whole host of destinations in the former Eastern Bloc, and made second home ownership possible for millions. Right at the start of the decade, the events of 9/11 changed flights forever and ultimately made many middle-eastern destinations no-go zones in the eyes of many.

This decade doesn’t look like being any less significant. The global recession has already changed how people travel, with cost, value and practicality all high on the agenda of holiday makers. What the recession has proved though is that people see travel as an essential part of their lives that they are not prepared to do without. People’s habits have undoubtedly changed but holidaymaking is still alive and well.

What does the outlook for travel in 2010 look like and what are the changes that we’ll be looking back on in ten years time?

 

Staycation here to stay

 

The term ‘staycation’ was coined in the summer of 2009, as budget conscious families, buoyed by promises of a ‘BBQ summer’ decided to holiday in the UK rather than venture abroad – avoiding high travel costs and unfavourable exchange rates into the bargain.

 

Although family budgets may look healthier in 2010, the concept of domestic travel looks here to stay, whatever the weather. Indeed, even before the recession the UK domestic tourism market had been making a strong fight-back with ever-improving leisure offerings popping up all over the country – from the Eden Project in Cornwall to top end golf resorts in Scotland.

 

As well as this, new, high-end and contemporary accommodation has popped up all over the country, from city hotels and apartments in places like Manchester, Liverpool, Leeds and Bristol to high-quality self catering options – including timeshare and fractional ownership– giving consumers more options than ever.

 

Previously infamous British cuisine has enjoyed something of an image enhancement over the past decade. Celebrity chef backed restaurants have branched out of their South East heartlands with openings in rural and urban locations across the country – from Rick Stein in Padstow to Michael Caines in Exeter. Meanwhile, the concept of the farmers market has brought domestically produced organic food to tourist communities across the country making self-catering a great option for wannabe gastronomes.

 

With exchange rates unlikely to improve in the short term and with events like April’s aviation shut down fresh in the mind, it is likely that holiday makers will increasingly be looking for domestic bliss when it comes to holidays over the coming decade.

 

Aviation on the wane? Will more people take the train?

 

Not with standing the eruption of Icelandic volcanoes, travellers have been questioning whether they want to fly away on holiday – with rising air fares, increased security and environmental concerns all playing a part. This move has created the concept of domestic European travel; or in other words, travel to continental destinations reachable by car or train.

With direct rail connections via the Eurotunnel likely to increase dramatically in response to the route being opened up to competition, more and more people are going to look at France, Germany, Spain and Portugal as ‘domestic’ locations. The ability to take more luggage and travel more frequently will make second home ownership of some sort increasingly popular.

 

Euro area pain

 

While exchange rate fluctuations will only ever have a temporary effect on travel plans and often just lead to belt-tightening whilst on holiday, it’s undeniable that the relative strength of the Euro over the Pound has made people look at short-haul alternatives to the Euro area. In the short term this looks set to continue with destinations such as Turkey and Egypt benefitting.

 

Consumers are still travelling to Euro destinations in great number. Indeed a recent study by Skyscanner.net showed that five of the top ten most searched-for destinations for flights in 2009 were in Spain.

 

What is the difference now is that value for money the primary concern, with consumers keen to avoid the risk of currency fluctuations. Package holidays have had a resurgence and people are looking at smarter ways of owning or securing time at properties. In the holiday ownership industry the principle of fractional ownership – of anything from homes and castles, to yachts and planes – has taken off. Timeshare has evolved too to meet consumers’ changing demands, particularly the desire for value for money and flexibility. Points systems have emerged as a way of allowing timeshare owners to holiday in a range of timeshare destinations around the world. Timeshare owners are, perhaps partly as a result of this, increasingly happy customers with 87% of owners are satisfied or very satisfied with their timeshare and 73% said that it was better than other self catering holidays[1]. Over the next decade, vacation ownership looks set to increase in popularity further with different options available to consumers searching for flexibility and choice.

 

New destinations take centre stage

 

As Thailand and Mexico have become well trodden tourist paths over the past ten years, there are likely to be many newcomers over the next, as our thirst for new experiences and good value destinations remains. This year’s World Cup in South Africa is likely to open many holiday makers‘ eyes to the options that this stunning and fascinating country has to offer – provided security concerns are soothed rather than exacerbated by the media glare of the tournament. As well as being a unique and culturally rich country, South Africa is also a winter sun destination on a similar time zone to Europe, which gives it a unique appeal that is likely to propel it into the mainstream.

 

Green is not dead

 

Although consumer and media attention has focussed on the recession over the past few years, sometimes to the detriment of environmental concerns, the green agenda will increasingly shape the future of the travel industry – affecting where we travel, how we get there, where we stay and what we do when we’re there. It is hard to predict what will happen but no scenario is likely to be painless for the consumer or the travel industry which is why travel businesses are increasingly acting proactively to reduce carbon emissions by improving energy efficiency and developing sustainable processes and procedures.

 

Conclusion

 

Travel plays an important part in the lives of more people than ever, with the family holiday (and often two or more holidays) a firm fixture in the calendar in a way that it wasn’t in the past. Travel is also an increasingly important industry for the UK providing employment as well as trade for countless businesses. The future of travel is bright but what people do with their holidays and where they do it is likely to change markedly over the next decade due to consumer demand, increasing travel costs, global security issues and environmental and ethical concerns. It’s going to be an interesting and exciting decade.

 

[1] According to a major European study carried out by The Cristel de Haan Tourism and Travel Research Institute at Nottingham University into the timeshare industry.

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