How travel brands are adapting post-pandemic
Cross-border travel reached pre-pandemic levels in March for the first time since the pandemic began.
As people go on vacation again, how are travel companies in the industry responding to changing consumer behavior? Here’s a look at how brands are addressing issues of sustainability, flexibility, and loyalty.
IHG and Expedia refresh loyalty programs to deliver more value to customers
McKinsey’s travel survey of 1,338 US consumers in June this year found that loyalty programs are less valuable to younger consumers. As the report states, “Some features of loyalty programs matter more than others: offering discounts, having the right footprint so customers can stay where they want, and making it easy to redeem points are favorites.”
This, added to the growing complexity of many loyalty programs, is leading some companies to shake up their offerings to make them more rewarding. Expedia Group is a recent example: the company revamped its loyalty program to create “One Key”, which now allows members to earn and use points on all Expedia Group brands including Vrbo, Hotels. com and Travelocity.
Jon Gieselman, president of Expedia Brands, explained in a press release that Expedia’s old loyalty programs – spread across its brands – ended up creating a system that was far too complicated. “If you add up all of our rewards members, we would be the ninth largest country in the world by population,” he said. “This is [currently] through four programs each with different currencies, different benefits, different rewards mechanisms. It’s confusing, limiting and not in the best interest of travelers.
By unifying the system, Expedia is able to create better connectivity across its portfolio of brands, giving customers more flexibility in how they earn and use points, and encouraging increased loyalty across the group. For example, points earned on an Expedia flight could be used when booking with Vrbo.
Elsewhere in the hospitality industry, IHG has made changes to its new “IHG One Rewards” program. Most of this comes in the form of personalization, allowing customers to choose the rewards that matter most to them (from a selection of rewards every ten nights). Speaking to Skift, Heather Balsley, Senior Vice President of Global Loyalty and Partnerships for IHG, explained how extensive user research informed the changes and said: “It was important that, although we had introduced new benefits for our members, we kept it relatively simple to redeem them.
IHG CEO Keith Barr said the new program has generated an increase in both usage and new members. “We’ve seen fantastic progress on our loyalty KPIs,” he said recently. “There were 14% more points redeemed and 18% more reward nights booked. And registrations increased by 30%, with 11 million more members added.
Marriott designs new rooms with bleisure in mind
Work habits have changed since the pandemic, with an increasing number of people working flexibly. Enter, ‘bleisure’ – the combination of business and leisure travel, where a personal vacation is added or mixed with a work trip.
Travel and hospitality brands can seize this opportunity by targeting business customers (who are likely to stay in the same hotel for work and leisure) with the promotion of “bleisure” activities, such as local attractions , events and nearby destinations. One company that has recognized the rise of bleisure is Marriott. During the company’s second-quarter earnings call, CEO Tony Capuano suggested travelers are focusing more and more on personal time for work. “Day-of-the-week trends in the United States and Canada suggest that travelers continue to combine leisure and business travel,” he said, noting that hotel occupancy, “generally called “shoulder nights”, was close to 2019 levels in Q2.
In response to this trend, Marriott would test new room designs for “bleisure” travelers at its new headquarters in Bethesda, Maryland. The idea is that the rooms can be transformed into an office or a bedroom, rather than both things at the same time, to give travelers the possibility of better separating work and leisure. Speaking to Hotel Management, Jeff Voris, senior vice president of global design strategies, said: “As a business traveler, historically the proposition is that you work in your room and sleep in your office. Maybe not as ideal as it could be.
With business travel lagging further behind in its recovery than tourism, businesses are likely hoping bleisure will encourage consumers to return to business travel, lured by the promise of a little extra downtime.
Airbnb expands rental categories as consumers search for alternative accommodation
Accommodation is expanding beyond hotels and apartment rentals, as consumer interest in alternative types of accommodation (such as glamping, hostels and rural retreats) increases.
Airbnb has, of course, helped popularize alternative lodging over the past decade, but the company continues to align itself with the desire for unique trips — and the ability to find them. As a result, Airbnb recently redesigned its search tools, introducing 56 categories to improve user experience and ultimately make it easier for consumers to find the right type of accommodation (rather than just the right location). Categories currently on Airbnb include barns, historic homes, farmhouses, off-the-grid, and even homes with “grand pianos” or “amazing pools.”
Along with the new categories, Airbnb has also introduced the “Split Stays” search option, allowing guests to find two different places to stay in an area, in case one isn’t available for the entire time.
???? Airbnb Categories: A new search method that makes it easy to discover places you didn’t know existed. pic.twitter.com/cqQ51gb64x
—Airbnb (@Airbnb) May 11, 2022
Skyscanner and CWT add ‘green travel’ options to align with demand for sustainability
Sustainability is a growing concern for consumers today, but research suggests many are confused about how they can travel in a greener way. Expedia’s Sustainability Study surveyed 11,000 people in 11 countries and found that 90% of respondents look for sustainable options when planning a trip, but seven in ten respondents said they were overwhelmed by the process of becoming a more sustainable traveler.
Understandably, it’s hard to describe what sustainability in travel actually entails, with cynicism often surrounding terms such as ‘carbon neutral’ or ‘carbon offset’.
Clear and concise action is essential. McKinsey’s aforementioned travel survey found that while 75% of respondents agreed sustainability is important, only half would pay extra for it. However, younger travelers are more likely to be willing to pay for achievable sustainable initiatives that are visible while on a trip, with McKinsey offering examples such as “use of environmentally friendly cleaning products; replacing plastic key cards with alternatives; reduced use of paper, e.g. ex. electronic receipts; and smart appliances and monitoring systems to optimize energy consumption.
Travel recognizes this demand by promoting sustainable options. Skyscanner introduced its Greener Choices flight filter in 2019 to help consumers find low-emission flights. Building on this, the travel booking site introduced an electric and hybrid car rental filter earlier this year, allowing consumers to easily search and rent electric vehicles. Skyscanner’s green leaf icon will appear in search results to highlight eco-friendly options.
Business travel provider CWT has also started promoting green travel options through its myCWT mobile app. Skift reports that the company has added car rental and train reservation capabilities, as well as indicators that highlight electric and hybrid car options. Estimates of carbon emissions are also reportedly in preparation and should be added at a later date.
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