Holidays at Home: How Travel Companies Can Ride the Domestic Tourism Boom
The year may have changed, but COVID-19 is still with us – and spreading faster in some countries – and so it looks as if international travel restrictions will remain in place for some time to come. But one positive side effect has been the growth in many destinations of domestic travel, as people who would normally holiday abroad rediscover the delights of their own countries, unencumbered by foreign tour groups or huge visitor numbers.
So with domestic travel undergoing something of a boom in many regions, how can struggling travel companies more used to selling outbound trips or marketing to inbound travellers pivot and make some much-needed revenue from domestic tourism? Here are our tips. But first, some numbers…
Before we look at some ideas for selling more domestic trips, let’s take a look at some numbers. Travel industry consultancy Pear Anderson have done a great job of reporting on the COVID situation in Southeast Asia, and here’s how the virus has affected international travel into the region:
As we can see, there have been huge decreases in every country, and if those figures were for March onwards, when the virus really began to kick in, those numbers would likely be close to 100% across the board.
But with international travel non-existent, domestic tourism has boomed. Here’s a graph from McKinsey showing what happened in China in 2020:
By September, domestic tourism had not only recovered, but hotel bookings were actually exceeding 2019 levels, with domestic flights and rail travel recovering too. And McKinsey expects this to be a global pattern, with domestic travel recovering a couple of years before international:
How To Adapt
Not all travel companies are geared up to sell domestic trips. Travel agents may have big databases of local travellers, but, more used to selling overseas destinations, lack the knowledge, expertise and contacts to put together domestic itineraries. DMCs on the other hand have that local expertise after years of selling their own destination, but their customers are primarily overseas travel agents and their customers.
So there is definitely scope for partnerships here, with DMCs putting together domestic itineraries for travel agents to sell to local travellers – a much quicker solution than either party trying to do a big pivot, when immediate action is required for many businesses to survive.
One of the great things we’ve seen in the industry in the last year is an explosion of creativity, as travel companies in need of revenue start thinking very much outside the box (or throwing the box away altogether in some cases) in order to adapt to the new normal. The old ways of working may come back eventually, but right now they’re not going to cut it and if you want to exploit the domestic tourism boom, you’re going to need some fresh thinking!
Firstly, think about what domestic travellers want – it may be very different to what you’ve been selling to foreign tourists. Think about destinations that domestic travellers may be less familiar with. Think about activities that domestic travellers might struggle to arrange themselves – you may have unique insider access to attractions and locations that domestic travellers would love to experience, such as this fantastic weekend as an airport firefighter in Kuala Lumpur, or this Singapore heritage tour with unique inside access:
Singapore is actually a great case study for creativity at the moment, as it is something of a special case: not only has it been hit by a lack of inbound tourists, but also as a tiny country with limited attractions and a population of just under 6 million, its domestic travel market is very small indeed.
Another thing you can do is look at what services you’re used to providing to inbound tourists and think of how you can reposition them for the domestic market. One Laos DMC I spoke to over the weekend is using its expertise, its hotel/transportation contacts and its extensive guiding network to put together innovative teambuilding events and corporate retreats for local companies, and whilst budgets for such things may be shrinking, so is the cost!
Look for Trends
To find out what’s popular with domestic travellers, look at social media, particularly Instagram, to see what’s trending and which destinations are hot. For example, over the festive period, #fog was trending here in Thailand. Thais, especially Bangkokians, rarely get to see fog, and with the mountains of the north experiencing a lot of low cloud, they were flooding to foggy locations in their droves to take pictures.
Also look at who the top travel influencers are in your country and see where they’re travelling, as those destinations are sure to be hot hot hot. You could even try and partner with top influencers to get them to promote your brand. And don’t just sell hot destinations – think about alternatives for those who want to avoid the crowds. So if Destination A is full of Instagrammers, look for a less celebrated destination with the same qualities and attractions and promote that.
Stress That Now Is the Time
With popular tourist destinations now standing empty, the message to domestic travellers needs to be that there has never been a better time to explore your own city or country. Here in Bangkok, popular spots such as the Grand Palace or Wat Pho, usually crammed with Chinese tour groups, are deserted, and are therefore much more enjoyable to visit (especially for photographers). And by way of comparison, here is Cambodia’s Angkor Wat before and during the pandemic:
The collapse of international travel has meant huge reductions in hotel rates too, so there’s never been a better – or cheaper – time for a staycation. Just before Christmas I spent a night at the Conrad Bangkok, where a room that would normally set me back $300 came in at around $70, including breakfast for two and an upgrade. And during the week hotel rooms are even cheaper, so think about targeting those who are either not working or are flexible in their work arrangements, such as retirees or digital nomads.
Embrace New Technology
Setting yourself up for domestic travel can be a length process, so to speed it up, look at tech solutions that can help you. Digital marketing – particularly social media, Adwords and retargeting – are a quick and easy way to target domestic travellers. And when it comes to putting together itineraries, a solution like eRoam, which has thousands of hotels, activities, domestic flights, transfers etc in your destination, is an affordable and easy way to access the products you need to sell great domestic trips. Here’s a video that explains how eRoam makes selling road trips simple and affordable.
So whilst the travel industry may be in something of a slump, there is still revenue to be made and savvy, creative companies can both survive and thrive by embracing the domestic travel boom. To find out how eRoam can help, get in touch! And to see this article in webinar format, check the video below: