Hello Stuart, lovely having you on Marketing In Asia. Before we go further, let’s get to know you first.
I’m a result-driven individual and I specialise in helping brands interpret data for commercial application and opportunity. I’ve been in the travel, data and media industries for over 20 years and have worked across Europe, India and APAC.
I joined ADARA in May 2015 as a Commercial Director for the Pacific region and went on to lead Strategic Accounts & Data Solutions in Asia Pacific as Managing Director, before arriving at my current role. Prior to ADARA, I was with HotelClub and Orbitz.
We know that ADARA is the world’s travel data co-op and leading provider of traveller intelligence. Tell us all we need to know about the company.
ADARA provides consumer brands critical intelligence that drives personalisation throughout the customer’s journey, which results in greater marketing efficiency and more meaningful and profitable relationships. Our clients are from sectors including travel, financial services and retail.
We apply our proprietary machine learning and AI capabilities to ethically-sourced and ethically-deployed data from our 270 data partners. The result is the richest and most comprehensive view of the world’s consumers and their behaviours across brands, channels, and devices. The insights we offer enable our B2C clients to identify, understand and engage with their consumers at every stage of the customer lifecycle, unleashing the revenue potential of each individual.
Let’s talk about travel and tourism in Asia, pre-Covid 19, Stuart.
The travel and tourism industry in Asia Pacific showed signs of growth all throughout 2019. Preliminary air traffic figures from the Association of Asia Pacific Airlines (AAPA) revealed a moderately healthy 4.2% increase in the number of international visitors for the full year – a total of 375.5 million. Before the global outbreak of COVID-19 at the end of 2019, the Asia Pacific region was slated to achieve almost one billion international visitor arrivals over the next five years, as predicted by the Pacific Asia Travel Association (PATA).
These promising forecasts can be attributed to a variety of reasons: Asia Pacific offers a high density of unique locations and experiences, easily accessible to travellers owing to the increasing range of routes and frequencies offered by airlines across the region. Additionally, the increasing popularity of low-cost carriers in Asia Pacific also present a cost-effective way to take frequent trips to and around the region.
Asian tourism has been hit hard with the emergence of Covid-19. Walk us through the state we are in right now.
The emergence of COVID-19 and its rapid escalation has put a significant damper on world travel and tourism. While the Asia Pacific region has borne the brunt of the impact, especially from December 2019 to February 2020, the outbreak is currently at its most severe in Europe, and is beginning to gain momentum in the United States.
In a bid to control the spread, numerous countries have announced travel restrictions. Many have closed their borders to short-term international visitors from the worst-hit countries, as well as imposed strict quarantine periods on all returning from virus-affected places. As a result, travel-dependent industries everywhere have suffered. The International Air Transport Association projected on 5 March a potential air travel revenue decline of $113bn this year – one-fifth of last year’s overall revenue, and four times the organisation’s initial estimate in February.
A similarly adverse impact has played out across the global hospitality industry – according to data from the ADARA COVID-19 Resource Center, hotel bookings in the US have witnessed significant decreases from the week of 6 February onwards, with a larger dip in leisure traveller bookings (compared to business traveller bookings). Data also revealed a steady and continuing decrease in business flight bookings over the same period.
Given the rapidly evolving nature of the outbreak, governments and industries have to continually assess the situation, and swiftly adjust short- and medium-term strategies to ensure business continuity and stability. For instance, hospitality brands have the opportunity to adapt to current developments with more efficient channels and tactics – such as increasing their online presence and leveraging staycation trends.
Amidst these challenging circumstances, what is equally critical is for companies to not lose sight of the long-term game and prepare for recovery and rebound. As some in the industry have noted, resilient markets with strong global destination reputation and appeal, such as Singapore, did not experience any long-term impact but instead saw rapid recovery in visitor arrivals after being declared SARS-free in 2003.
Tell us about data and advanced marketing capabilities, Stuart – is this something travel brands can invest in to ensure consumer reach?
Beyond offering travel and consumer brands a window of opportunity to raise competitive advantage and seize market share in times of growth, advanced data and AI-driven marketing can boost brands’ ability to weather times of uncertainty.
Brands that have consistently invested in building comprehensive customer profiles and advanced marketing capabilities – such as AI-driven prediction and dynamic use of data across channels – are better positioned to identify and capture opportunities in the midst of crises.
In fact, building data and advanced marketing capabilities have been key focus areas within the industry for some time. A 2019 ADARA study found that more than half (57%) of brands were prioritising a deeper understanding of purchase behaviour outside of core purchase details.
While businesses have to address near-term business concerns in today’s circumstances, those that continue to take steps in building an advanced marketing operation – be it during or after the outbreak passes – will gain incremental benefits as richer data and new analytic capabilities are tested and scaled.
What are the key trends we can look forward to in the tourism and related industries this year?
While the tourism industry has borne the brunt of the COVID-19 outbreak, we are starting to see silver linings in certain segments around the world. In the US, ADARA’s Traveler Trends Tracker observed an increase in domestic flights purchased 90 days or more in advance. While this does not signify an industry-wide rebound, it suggests that some leisure travellers are capitalising on the renewed booking flexibility that many airlines are offering to plan their summer travel in advance.
Here in Asia, industry players have also started to see “revenge spending” emerging, particularly in China. As the government gradually relaxes their COVID-19 measures, Chinese consumers are back to buying luxury goods in retail outlets and shopping malls after weeks of stringent quarantine protocols that were put in place to combat the rise of infected cases.
Due to a relatively high rate of digital adoption in the Asia Pacific region, there are vast opportunities to tap into and utilise relevant consumer data. To this end, brands that look to deliver higher levels of personalisation and use data in more effective ways will be well-positioned to gain competitive ground when recovery eventually sets in.
Nevertheless, the situation is constantly evolving and new trends are expected to emerge. It is important for brands to closely watch changing patterns as they determine their path forward during the progression of COVID-19 worldwide, and the ADARA travel trends tracker is a resource we have developed to help brands make the best decisions in an extremely uncertain environment.
The COVID-19 situation doesn’t seem to be slowing down in the next few months. With industry players buckling in for the long run, can we expect the travel industry to pick up where we left off, post-COVID-19?
In light of recent COVID-19 developments, international organisations have revised their 2020 industry forecast. As of 5 March 2020, the UN World Tourism Organisation (UNWTO) estimated a 1% to 3% decline in international tourist arrivals in 2020 globally, down from a 3% to 4% growth estimated in early January. More recently, financial insights firm S&P Global Ratings predicted a 20% to 30% decline in global air passenger traffic in 2020 and a protracted recovery that may run until 2022 or 2023.
While the global travel and tourism industry has shown its resilience and tenacity in overcoming disease outbreaks, geopolitical and social tensions, and global economic slowdowns over the years, industry players across the board are preparing for deeper and longer impacts to business with COVID-19.
In response to the decline in traveller confidence and demand, businesses have deployed a range of tactics to encourage consumer spending and stem business losses. In APAC, a recent study found that hotel players are strategically rolling out value-added packages and promotions instead of simply lowering rates. They are also diversifying by targeting new market segments beyond leisure travel that have shown to be more resilient.
It is important for businesses to remember that, while demand has declined, it has not completely ceased. By capturing what is left of the demand and strategically investing in both stemming losses and building long-term competitiveness, businesses can tide over this challenging period and recover well.
Where can Marketing In Asia readers go to know more about the travel and tourism setbacks and trends, Stuart?
In light of the rapidly changing COVID-19 situation, we have developed the ADARA Travel Trends Tracker to provide brands consumer-level intelligence in this extremely uncertain environment.
Marketers can sign up for the latest updates at our COVID-19 Coronavirus Resource Center online. ADARA also shares regular updates about trends in the travel and tourism industry on our LinkedIn page, so do follow us to stay up to date.