Conducting the Business of Travel in a Tumultuous World
Photo courtesy of Key Tours
Nigel Osborne, a travel veteran who has held high-level executive positions at Trafalgar and Insight Vacations, currently serves as vice president of sales and business development for Key Tours, a tour operator that specializes in independent custom travel packages and some group tours in Europe and Latin America. TravelPulse asked Osborne how the violent events of the long hot summer of 2016 are affecting business.
TravelPulse: What is the effect of the violent incidents in Europe and America on Key Tours business?
Nigel Osborne: It’s bizarre, the whole thing. It’s hard to put a finger on why or what or where. We had a couple of flat or down months. In June future bookings were up 10 percent over last year, mostly bookings for September and October, a little shorter booking window than usual. Our retail travel business year to date is up 10 percent over last year, and that is most of our business.
Then came the incidents in Nice and Turkey and July is down. There is a late booking trend because companies are offering discounts.
TP: What are you hearing from the ground in Turkey?
NO: Turkey is not seen to be dangerous at the moment. I’m planning to go. I have to go on business the second week in August. Our CEO is in Istanbul now and he said everything is back to normal. All the tours operated as scheduled with no diversions or big cancellations. We did not have passengers there during the uprising that Friday and Saturday.
I read a business report that said that in Turkey the average daily revenue per available room dropped way down to $54 a night. The occupancy is so bad they can’t even get the Russians or Chinese or the hardened travelers to go there.
The FAA banned flights to Turkey on Monday morning, then rescinded it the same day. There’s quite a few Americans there because there is still a U.S. military base in Turkey. The U.S. government banned the flights and couldn’t even get their own people out. They told them not to go to the embassy because the embassy’s under threat. They shot themselves in the foot saying get out if you can and then canceling all the flights. How can you get out? They didn’t cancel flights to Brussels or Paris after those attacks, but they did in Turkey. I don’t understand the government sometimes.
Luckily we didn’t have anybody in Nice. We had another 10 to 12 bookings leaving for Nice, and out of those I think one couple decided to cancel. There was a party of eight now it’s a party of six. Quite honestly we were very much in respect for the clients. They said we’re not going to let these random acts ruin our vacation. We have the right to travel for vacation and we’re still going to go and that’s it.
TP: Refraining from visiting a place after an incident doesn’t seem to serve much purpose. It’s not as if the incident is going to be repeated. You don’t know where on earth the next one will be.
NO: It’s true. It’s not like a serial killer. These are desperate attacks from an organization that may be shrinking, but at the same time if there was a bad accident at the crossroads last week, do I not drive through that traffic light anymore? That’s why they call them accidents or incidents. They are very random.
Did everyone stop going to downtown San Bernadino? No they didn’t. Same with Orlando. What one could read into it is that these random attacks may increase, you never know, but the only thing to do is to get on with our lives and enjoy it while you can. Everybody has to follow their own gut, that’s my feeling.
It may be different for me because my father was a military officer in the Royal Air Force and we lived in Aden, Yemen, which was then a British protectorate. While we were there there was a coup and an uprising. We saw killings, two factions fighting. I had to go to school in an armored car and stuff like that. So I don’t think anything about it.
I was recently joking with people that in Portland, Maine, where I live now, the inmates haven’t taken over, everyone is happy. But there are some places in this country… At the time just outside of the Republican convention all these people were arming themselves, walking around trying to instigate. Ohio has those open carry laws, which is asking for trouble in my view. Chicago has more murders every weekend than anywhere else. Eighty-five percent of accidents happen in the home, so I suggest you travel. It’s safer to travel than to stay home.
It’s bizarre. The world is changing,
TP: What kind of effect, if any, are you seeing from Brexit?
NO: There are pricing advantages. One good thing that is happening is that air fares are currently going down. That will spur travel. VisitBritain has reported a strong second quarter versus the last couple years. I believe good deals for families will increase.
The travel seasons are changing. There’s a big swing. People are traveling less in July. U.S. travelers don’t travel internationally in August. That’s when the Europeans travel. We’re seeing a lot moving into October and November. We have five big groups in October all sold out, and they were still selling as all these incidents were happening over the last few weeks.
We have found that group business has held up very well. We haven’t had any big cancellations. The group business is resilient. It’s the individual traveler who tends to have the doubt. Parties and multi-generational groups tend to travel.
We do mostly high-end independent vacations and a few small group journeys. The high end tend to plan well in advance, usually six to 11 months. But when there are offers out there, they’re booking within two to three months.
We also have found group business has held up very well in spite of what’s gone on. We haven’t had any big time cancellations. Some of the groups are smaller than they would have been without the incidents, but for the most part, the group business has been resilient.
We’ve seen an increased interest in South America, especially Peru, Argentina and Chile. We’ve seen an increase in group bookings down there. It’s the individual traveler who tends to have the doubt or trepidation about finalizing their reservations. I find the bigger the party, like multi-generational, the more they tend to travel.
READ MORE: Tour Operators Take a Reckoning on Brexit
Italy, France and the UK are our biggest destinations. Then Croatia, Morocco, Spain and Portugal and Greece. Turkey was a relatively big destination, and it will come back. Packages are selling well for Amsterdam, Prague and Budapest, places like that. Central Europe is perceived as safe. Switzerland. Iceland has become big. Just try to get space in Iceland. They put their prices up.
We’re seeing more specialty trips, affinity groups and themed independent hosted vacations.
We were very much encouraged by June and then the Nice and Turkey things happened and bing. There are a few reservations, but there’s a late booking trend because everybody’s offering discounts. But we’re all still in business. Business will come back.
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