After nearly two years of facing the pandemic, tourism has recently shown some signs of return as vaccination rates in many countries are increasing. To prepare for the return of tourists, what new demands in tourist behavior need to be understood by service providers in the tourism industry?
Launched at the end of July, Expedia’s Traveler Value Index covers seven values that shape global travelers’ preferences and decisions for Hotels, Vacation Rentals, Aviation, Car Rental, Cruises. This report is analyzed based on a survey with travelers from 8 major markets: Australia, Canada, France, Germany, Japan, Mexico, UK, and the USA. The seven value factors include:
- Ability to get a full refund
- Atypical, low pricing
- Contactless experience
- Environmentally-friendly policies
- Enhanced cleaning and disinfection
- Flexible policies to change bookings
- First-class benefits and upgrades
In all 5 tourism service segments surveyed, the Ability to get a full refund in the event of cancellation bookings is the top concern for travelers, along with Enhanced cleaning and disinfection. According to Expedia, this is a significant shift in the context of the pandemic compared to the conventional wisdom that price drives purchasing behavior. In particular, the top values by each service segment:
When travelers choose a hotel, the 3 most appreciated values are the Ability to get a full refund, Enhanced cleaning and disinfection, and Atypical low pricing. Approximately 24% of travelers surveyed rated the value Ability to get a full refund as most important. In which, Germany is the market with the highest rate (33%) and Mexico has the lowest (13%). The next two factors are Enhanced cleaning and disinfection which accounted for 22% and Atypical low pricing with 17%.
However, given the value of the Ability to get a full refund, Expedia’s survey found a difference between two groups of travelers: under 40 and above 40. Travelers under 40 give less interest to price and refunds. For example, travelers in the US and Japan tend to rate Enhanced cleaning and disinfection as most important, along with Contactless experience and Premium benefits. Particularly, the group of travelers who are over 40 years old focuses more on Refund policy and Price.
Similar to Hotels, about 26% of travelers surveyed rated the Ability to get a full refund as the most important value for Vacation Rentals. The two following values are Enhanced cleaning (19%) and Low price (17%).
Particularly for the Japanese market, the Environmentally-friendly policies is rated higher than many other values, ranked 3rd with a rate of 14%. This value in other countries only ranks around 6th place.
In addition, Flexible policies to change bookings ranked 4th (13%) in terms of overall markets. However, the survey highlights the increase of this value for family trips in the North American market.
The Ability to get a full refund remains the most important ranked value for Aviation, with 26% in the total of the eight markets surveyed. Germany (34%), UK (31%) and Australia (31%) are the three countries with the highest rates. Enhanced cleaning and disinfection, and Atypical low price are the following values with the same rate of 18%.
However, travelers under 40 years old are more concerned about Contactless experience. Especially, Millennials and Gen Z travelers appreciate the Low price factor more than Enhanced cleaning.
Across the eight countries surveyed, the Ability to get a full refund is the most important factor for travelers (23%) when renting a car, followed by Enhanced cleaning (20%). However, there are some major variations in each country for this type of service. Japan rated the Enhanced cleaning factor as the most important with 25%. Meanwhile, Mexico ranked Low price as the top factor (31%) and Enhanced cleaning as 2nd (21%).
Also, there are some age differences. Millennials in the US and Canada tend to be more interested in the Flexible policies to change bookings, and the older group (over 40 years old) is more interested in the Enhanced cleaning value.
Particularly for the Cruises, Low price is an important factor for many travelers, especially France (27%) and Mexico (28%). Even so, the Ability to get a full refund is still the most important value across 8 markets, with 24%. The second is the value of Enhanced cleaning with 20%. Particularly, Gen Z in the US ranks Environmentally- friendly policies as the second most important factor for Cruises.
Although there are some slight differences by country and age, it can be seen that the factors related to refund, price, and enhanced cleaning are top concerns to the majority of travelers, after being affected by the pandemic over the past two years. Especially, Millennials and Gen Z travelers are more concerned with environmental factors than the older generations, who are concerned about price. The findings from Expedia’s report once again confirm the important factors affecting travelers’ behavior and choices after the pandemic, which is the basis for tourism providers to better prepare to attract travelers as tourism is gradually resumed.