How global consumer trends are impacting travel

Consumer behavior trends have been hard to call over the past couple of years.

In an uncertain world, companies across all industries including travel have tried to ascertain what post-pandemic behavior might be short-lived and what might stick.

In its Top Global Consumer Trends 2024, Euromonitor identifies six areas that have already piqued consumer interest and are likely to continue to do so this year.

It’s no surprise that artificial intelligence makes the cut of the top global consumer trends. Even before the first quarter of 2023 was up, travel companies including Expedia and Kayak unveiled their first ChatGPT plugins. And the industry can expect further developments as the technology and the tools mature.

“New tools are evolving into co-creators for consumers, influencing their decisions and reshaping their expectations of brand engagement,” Euromonitor said. “These platforms will become increasingly integrated into consumers’ daily lives. Businesses should utilize generative AI to enhance personalization and improve the overall customer experience.”

In addition, research from the market intelligence company revealed 42% of consumers are comfortable with voice assistants providing personalized product information while only 17% are comfortable using a bot to solve complex customer service issues.

Travel companies have taken note of the developing AI trend with use cases emerging across all segments of the industry from business travel and hotels to tours and activities and vacation rental.

Consumers have also been familiarizing themselves with the technology. A report released by management consultancy Oliver Wyman late last year revealed a third of leisure travelers had used generative AI powered tools. The study concluded that uptake was high for a relatively new technology and added the satisfaction rate was also high.

As Euromonitor concludes, consumers will expect travel companies to keep up with the technology.

A number of less expected consequences of the generative AI trend that are worth watching include whether travel companies will develop in-house teams or buy up existing players. We can also expect travel companies to create new roles within their organizations for prompt engineers and AI leaders.

Cash considerations

Factors such as global conflicts, inflation and a cost of living crisis have all contributed to uncertainty in 2023 driving many consumers to consider their finances. While pent-up travel demand showed no signs of abating last year, Euromonitor highlighted “Value Hackers” as one of its global consumer trends for 2024.

It said 44% of consumers planned to save more money in 2023, adding that they’re “employing increasingly clever strategies to get the very best deals.”

It’s a trend that has already spilled over into travel with buy now, pay later (BNPL) and even save now, buy later initiatives added to the payment options of online travel companies.

Klarna is the latest to announce its plans to expand in the travel sector with partnerships formed with Cathay Pacific and CarTrawler for its BNPL services.

A further example, cited by Euromonitor, is Turkish Airlines, which offers free overnight stays for passengers connecting through Istanbul with layovers of more than 20 hours.

Meaningful impact

The insights company also flags “Greenwashed Out” as a trend to watch in 2024. This is a challenging one for the travel industry, which is often singled out for its carbon emissions and unsustainable practices.

“While consumers are attempting to live more sustainably, they question whether companies and governments are fully utilizing available resources to create a meaningful impact,” Euromonitor said in its report. “They want organizations to step up and show proof of their eco pledges.”

In December, the Advertising Standards Authority, the United Kingdom’s advertising watchdog, banned advertisements from Air France, Lufthansa and Etihad, saying they were misleading consumers on their environmental impact.

While consumers might be quick to point out greenwashing, recent research from Phocuswright revealed that despite good intentions, they are unclear on how to travel sustainably and sustainable considerations rarely come into the purchase decision.

Further regulation will continue to impact corporate initiatives and goals. On a European level, the requirement for public companies to report on their environmental impact has now been extended to companies of 500 employees. The European Union Corporate Sustainability Reporting Directive means companies will have to monitor and report on the impact of travel on the environment and people.

Moments of joy

A final trend worth flagging from the Euromonitor report is “Delightful Distractions.” The trend feeds into the desire from consumers to get away from daily stress and the wider doom of global uncertainty.

According to Euromonitor, 29% of consumers would be comfortable for their moods to be tracked, enabling brands to tailor experiences to how people are feeling.

The evocative nature of travel makes this easier for the industry than perhaps other verticals. Many travel companies launch marketing campaigns at the turn of the year, urging consumers to book a sunny break. However, the infrequency of travel remains a challenge driving travel companies to think about increased interactions with consumers or collaborations with like-minded brands.

“Delightful Distractions are moments that evoke positive feelings,” Euromonitor said. “Think: exciting, heartwarming or playful. These interactions help spark joy and release tension, allowing consumers to leave their worries behind — if only for a few minutes.”

The remaining trends flagged by the insights company — “Progressively Polarized” and “Wellness Pragmatists” — will also continue to seep into travel.

Progressively Polarized speaks to the values consumers align themselves with and that ultimately influence purchasing decisions. According to Euromonitor, “people are quicker to call out or avoid companies that push marketing campaigns around controversial topics,” so travel brands that manage to tap into their customers’ values will garner loyalty.

Finally, the wellness trend has been playing out in travel for some time with digital detox type breaks offered by many hotels and other travel suppliers for a number of years. In addition, a number of wellness focused startups, including CalmGetaways and Boddy, have sprung up recently while others such as, Vacayou, are expanding their services. Accommodation startups, including Raus, which encourage a break from the daily grind, are also gaining traction.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *