COVID-19 has brought the world economy to a standstill. Almost every industry, with a few exceptions, has been hit hard. Certainly, the momentum of the travel industry was brought to a halt. While recent headlines such as travel bans and major event cancellations make that progress seem like a thing of the distant past, it’s important to remember the industry was healthy and shattering records before the pandemic hit. In fact, the world economy in general was doing fantastic.
Despite these challenges, history has shown that industry is resilient. While we don’t know exactly when things will get back to some semblance of normality, we do know that it will come back. Though industries have weathered many catastrophic events, such as 9/11 and the Great Recession, and others going back further, they have always climbed back and flourished. COVID-19 is unique in that there’s no clear end in sight or economic model to predict how long the virus will pose a risk, but it will come to an end and, when it does, will you be ready.
What we can Learn From Past Crises
Past events have hit us hard. But, business always moves on and often comes up with new ideas that can last and even change an industry. For example, following the The Gulf War, the Marriott Corporation that withstood the financially challenging event split into two companies: Marriott International and Host Hotels. This pioneered the asset-light franchise model that became widely adopted by the hotel industry around the world.
Before the September 11th terrorist attacks, airport security was largely handled by private companies. Following 9/11, management of security shifted to the Transportation Security Administration (TSA) and became a part of everyday customer expectations throughout the airport journey. This evolved public-private partnerships, and these partnerships have seen the development of programs such as TSA PreCheck today.
After the 2008 financial crisis, many consumers had to seek out new ways to find employment. This contributed to the rise and rapid growth of the gig and sharing economies and companies such as Uber and Airbnb, which were both founded during that specific time of economic uncertainty.
How will the travel and hospitality industry as well as many others evolve post-COVID-19? Here are four actions that businesses and travel brands can take to prepare for the future.
1. Engage customers to stay “Top of Mind”
While many companies are cutting budgets to preserve cash, they might forget that marketing is more important than ever. Businesses of all kinds are integral parts of their local communities and should continue to find ways to actively participate in the COVID-19 response.
Looking again at the travel industry, there are several examples of this. Delta, for example, is flying medical volunteers for free, Four Seasons in New York City is offering free rooms for healthcare workers, and Carnival has offered their ships to be used as offshore medical facilities.
Industry brands can also learn from companies that invested in and prioritized marketing during past recessions. Researchers have found that brands can speed up their recovery post-recession or post-COVID by building brand value and awareness during this time period. One example of a destination currently putting this into practice is Visit Last Vegas, with its #OnlyYou campaign. The video showcases an empty Las Vegas strip and works to remind people that the city will be there when they begin to travel again.
2. Digitize and streamline contact centers
As customers shift and cancel work related business, contact centers are getting inundated. The research team from digital business transformation company Publicis Sapient found that in the third week of March 2020, average wait times for customers were over two hours. For one particular company, as many as 50 percent of its customer calls went unanswered.
Companies can reduce call center volumes by streamlining “digital touchpoints” to make it easier for customers to interact via digital channels. Leading companies have blended their digital and call center teams, automating the use of natural language processing tools to analyze calls and optimize customer demands fluidly across channels.
Companies should use this slowdown to streamline operations and diversify their business by reevaluating customer service, demonstrating empathy, earning consumer trust, and improving inventory and products for when demand does come back. Be ready for the return to business as usual even though we don’t know when that is going to come.
3. Reevaluate the competitive landscape
The economic impact of COVID-19 is inevitable. Many companies of all types and sizes will face financial difficulty and bankruptcy. Recovery will not be homogeneous as different parts of the world fight to control the spread of the virus on different timelines. Small local businesses are likely to recover faster as they are more malleable and dexterous than larger companies. But, where smaller companies may go out of business the larger companies are more likely to take the blows this economy is giving them and bounce back.
This means that brands have to reevaluate what the competitive landscape might look like post-recovery. While the timeline is hard to predict, companies in the position to do so need to take steps now to be ready to gain market share, enter new markets, and offer new products.
While entering new markets requires understanding and attracting new customers, there is a wealth of data that allows companies to analyze customer behavior, identify the right prospects, and look for signals to identify when travel is picking back up.
Once these markets are identified, companies can streamline their marketing technology and processes to be able to get the right messages to the right customers at the right time. Setting up dynamic segmentation and then lining up the right offers and promotions will help brands bounce back more quickly.
It’s likely that the changing competitive landscape will make it more necessary for brands to invest in direct-to-customer digital channels. Cruise lines, for example, will have the opportunity to sell directly to consumers, as many of the small cruise-focused travel agents may not recover. Direct hospitality bookings are also likely to strengthen, as some travelers will hesitate to book through online travel agencies or stay at Airbnb properties as they seek out increased quality assurances and flexibility in their rebooking and cancellation options.
4. Bring health and wellness to the forefront through contactless technologies
Health and wellness practices will no longer be a nice-to-have in a post-COVID-19 world. Every customer will expect better attention to safety. All travelers will expect higher standards to ensure their wellbeing, and digital tools will enable and expand existing “no touch” options.
For example, mobile-first technologies such as contactless payments have been in the market for a few years, with limited adoption. However, recent behaviors signal a spike in adoption as customers become more comfortable with the behavior and reconsider who and what they come into physical contact with. For travelers and guests, mobile usage will increase throughout the travel journey, from passports and boarding passes, to keyless hotel entry and digital checkout at hotels.
Hotels will also need to accelerate their investments in “no touch” technologies, such as biometrics, gesture controls, and automation, to personalize digital interactions while enabling social distancing. A leading example of this can be found at the Chengdu Shuangliu airport in China, which has kiosks that already use facial recognition to help travelers check their flight status and find their gate.
All industries are at a point of disruption, and the future will be brighter but different from what we’ve seen in the past. That’s just going to happen, so accept it and prepare for it NOW.
As we consider the economic consequences combined with the explosion of new technologies from 5G to artificial intelligence, I’m excited to see how companies respond and evolve and how the startup community emerges from this event.
The team at Parker Associates and PTC Computer Solutions follows the latest news and information in the industry so that we can stay on top of the changes that will affect your industry. There are many factors that are reliant on the economy and what is happening in the market both locally and globally. This affects the consumer market and the positioning. We have a time tested method of success in helping businesses with marketing and product positioning.
Parker Associates bases product positioning on specific consumer preferences from current surveys and focus groups published by industry periodicals and reports, or direct consumer interaction designed and carried out by Parker Associates experts and contractors. Along with the tremendous support of PTC Computer Solutions and their team of experts in handling research and data, we are sure about our results. It is too important for guesswork or client opinions. Give us a call at 904-992-9888 or email us at firstname.lastname@example.org if your prefer. We are always at the ready.
David WB Parker is a principal of Parker Associates of Jacksonville, Florida, marketing consultants to the real estate industry; President of PTC Computer Solutions, IT Specialist, and an active real estate sales professional with Barclay’s Real Estate Group based in Jacksonville, FL. He is also a principal partner of the REMA Team of professionals. He can be reached at 904-607-8763 or via email email@example.com.