New Breed of Travellers

The travel market is growing fast and changing dramatically. With the Internet, emails, mobile phones and other communications technology so much a part of our daily lives, a whole world of information and choices are available to today’s travellers. Therefore, it is not difficult or uncommon for consumers to now do their own pre-trip research and plan their own vacation - welcome to the world where the traveller is in charge.

Abacus President and CEO, Don Birch observed, “In the last 10 years, new inventions and major technological advancements, have greatly altered the way people live, move and play. Consumers today are more sophisticated and want to take charge of everything - including their travel trips. That’s why it is critical for travel agents to innovate in order to understand and serve the customers of the future.”

A new breed of travellers

Rising incomes have created a breed of sophisticated and affluent consumers who are better educated, have more disposable income and appreciate the value of travel.

In his whitepaper “Asia Pacific Tourism Industry: Current Trends and Future Outlook” 1997, Amrik Singh, instructor of Department of Parks, Recreation and Tourism, University of Utah, Salt Lake City, noted that disposable incomes in Asian countries have soared as a result of strong economic growth. An inclination to travel follows as travel is no longer seen as a luxury but as an affordable commodity, a status symbol and a form of relief from work.

Changes in demographics are also leading to varying travel patterns.

For example, as more women enter the workforce, they enjoy greater spending power and thus travel more often. According to recent research conducted by MasterCard International, the ratio of male to female travellers has changed from 90:10 in 1980 to 60:40 in 2004. MasterCard noticed three distinctive groups among the female travellers – young single women travelling in self-organised groups; mother-daughter travellers; and older singles travelling in groups. Whether it’s shopping in cities or relaxing at beach resorts and spas, they all spend good money. In fact, MasterCard predicts that retail spending in Hong Kong, Seoul, Bangkok and Singapore will hit US$13.4 billion in 2011.

Similarly, a greying population and longer life spans have resulted in an increase in retiree travellers.

Customised travel plans to meet individual needs are also set for strong growth. The number of Free and Independent Travellers (FITs) is growing fast as customers are willing to spend more on customised vacations. Atrium Eco Travel, which specialises in customised tours, said that tailored tours make up 80% of its business and this has been growing by 20 to 25% annually since 2002.

Online travel has also experienced phenomenal growth in recent years. In online travel company, ZUJI’s annual Travel Survey 2003, 48% of Singaporeans had made travel bookings online, with 36% indicating that they will do so in the future. Furthermore, ZUJI’s current booking patterns showed that almost 30% of all online bookings and purchases on ZUJI are made by repeat customers.

Growth in Asia Pacific travel

Robust economic advancement, lifting of political restrictions and liberalisation of air travel, are just some of the factors that are propelling the tourism growth in Asia Pacific.

The arrival of low cost carriers has now also made travel affordable for the previously untapped (low-income) market segment. In Singapore, for example, four times as many low cost carrier passengers landed in Singapore in the first five months of this year over the same period last year (source: New Big Spenders, The Sunday Times, 10 July 2005).

Adding to that, growth in tourism around Asia will be spurred on by new regional attractions and events such as the Hong Kong Disneyland and the Beijing Olympics. 

This will, in turn, create new marketing opportunities in the travel industry, such as timesharing, meetings and incentives, ecotourism, cruise, sports-related travel and spiritual tourism.

In the short and long term, China will continue to be the main engine driving Asia Pacific travel growth. In June this year, The World Tourism Organisation noted that the number of Chinese able and eager to travel internationally has been growing tremendously. New air routes have opened up and frequencies have increased to further stimulate both outbound and inbound travel in China. By 2020, China is expected to be the world’s number one destination with an estimated 100 million tourists visiting each year, according to China Travel Service.

Interestingly, experts predict that an influx of tourists from Arab states will contribute significantly to the region’s growth. Middle-Eastern tourists generally spend about US$1,000 on their holidays – almost double that of any other visitors. These huge-spending tourists are now choosing South-east Asia as “they feel unwelcome in Europe and the US as the world turns jittery after the London bombings,” (source: Arab tourists flock to South-east Asia, The Business Times, 12 September 2005). Malaysia is expected to attract more than 200,000 Arab tourists this year, a 40% increase over 2004.

Travel industry must adapt - So what does all this mean for the travel industry?

At various stages of life, each person has different needs and demands for travel. For instance, young singles are likely to browse and book online, so travel agents may need to establish websites to enable them to capture the online traveller. Family travel is more complex as tour packages need to incorporate activities designed to cater to the entire family’s needs, therefore using a travel agent to plan their trip is a preferred choice. So how can travel agents advise families? And what special requirements do aged or business travellers have?

“Looking at the diverse needs of different travellers, travel agents must use different communication channels to engage travellers and address their needs appropriately,” said Mr Birch.

And despite the strong growth of online bookings in Asia, still only 4% of total bookings (worth US$1.5 billion) are made online. People throughout Asia Pacific use the Internet to search for information, but prefer face-to-face or telephone to make their bookings, resulting in the new browse online book offline, or BOBO, phenomenon. This means customers still depend on travel agents to pull together information, recommend the best options and then help customise their travel plans. Travel agents therefore need to develop strategies and adopt technologies that allow them to take full advantage of the traveller’s needs.

That’s why the role of the travel agent is now more important than ever. Travel agents rely on Global Distribution Services (GDS), like Abacus, to connect them to thousands of travel service providers. Through access to such information, travel agents can better add value to their travellers, providing them with more information and choice so that they can make the right travel decisions and build stronger customer loyalty.

But in order to customise the right product for the right traveller, travel agents need to stay close to the trends in how the customer shops for leisure and business. That way, travel agents will be able to then match their customer’s expectations.

According to Mr Birch, the traveller of the future will:

Be more socially responsible – today’s traveller supports global issues and wants to communicate with like-minded people and communities across regions, learning about other cultures and making a difference in other people’s lives.

Be mobile – the advancement of technology has made the traveller of the future more mobile, allowing them to do the things they want to, anytime, anywhere at their convenience

Want personalised treatment – customers like to feel special. Regardless of how much they may be paying for service, customers like to believe that the whole world revolves around them.

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