The Current State of Travel: Why Experience Matters Now More Than Ever

Article written by John S Kim, CEO of Sendbird

COVID-19 put the travel industry on a roller coaster, and now inflation threatens to keep the ride going. After two years of empty hotels and airports, travel surged again. Adventurers took advantage of amazing deals, and luxury experiences intended to woo consumers back to the roads, skies and waters in droves. Then suddenly after so much money got sucked out of the travel industry for months on end, the free fall was over, and brands harmed by the pandemic sought to make up for their losses with increased fares and room rates. Consumers have been more than willing to pay up.

Take airlines for example. In its April 2022 report, the Adobe Digital Economy Index found that domestic flight bookings were up 28 percent in March of 2022 over pre-pandemic levels (compared to March 2019). And in just the first three months of 2022, consumers spent nearly half of 2021’s total for the year – and this is before travel presumably heats up for the summer.

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According to the latest US Travel Association monthly travel report, six in 10 Americans are planning at least one trip this summer – and there are plenty of places for them to go. AirDNA, a short-term-rental data firm, noted that 58,000 new rentals were added to the market in January 2022, the single biggest addition to supply in a month since the start of the pandemic. There are now 1.5 million available listings nationwide, the highest ever.

Additionally, the World Travel & Tourism Council (WTTC) updated its economic modeling, forecasting that American travel and tourism would exceed pre-pandemic levels by 6.2 percent. This would account for almost $2 trillion in U.S. gross domestic product. Looking beyond U.S. borders, the council’s data shows that summer 2022 bookings in Europe have already surpassed 2021 levels by at least 80 percent.

Clearly, travel is on the minds of American consumers. But are we just getting to another peak on the roller coaster, a new high before taking another big plunge?

Will Inflation Dampen the Excitement?

Before travelers have been able to fully enjoy and explore their travel options, they’re having to face higher prices for airline tickets, gas, hotel rates and even food – not just because of brands seeking to make up for what was lost, but because of a steep rise in inflation. Over the past year (April 2021-April 2022), inflation has surged from 4.2 percent to 8.3 percent, provoking fears of a recession, which could have a significant impact on travel spending moving forward.

A recent survey from Bankrate.com indicates that almost seven in 10 people will change their plans in some way because of inflation. This does not mean that all bets are off, however. The survey still found that demand could trump price. So what can a brand do to prevent another freefall during what is expected to be its peak travel season? It can ensure that the experience is worth the investment.

Consideration Wins the Day

New levels of customer service – even before a trip begins – will be required to forge connections with travelers and to build loyalty for whatever may lie ahead.

Fouquet’s Paris has enjoyed a stellar reputation for service and providing the ultimate luxury stay – one that has won it legions of fans who will return again and again. It earned its reputation, in part, by its attention to the little things, the things that matter to guests and stand out in their minds as exceptional, even in their banality. The hotel is known for sending out a questionnaire to guests in order to learn their preferences prior to a hotel stay, asking about everything from bed preference to music to fruits to drinks they like. Anything a person could wish for at a hotel was taken into consideration to craft the perfect stay.

Today, people seek curated experiences, even if they aren’t seeking high-end French hotels. Travelers want to be more than a number; they want Fouquet’s attention to detail wherever they are. Fortunately, it’s easier than ever for travel brands to provide services that make them feel like part of an exclusive community.

When the right experience is created by a brand, it evokes feelings of joy and decadence within travelers. After feeling so neglected and unseen for so long during the pandemic, people continue to be willing to pay for personalized travel with attention to detail, even if it means cutting back on spending in other parts of their lives.

Forging Human Connections With an Assist From Technology

One key to success is keeping the lines of communication as open and fluid as possible. Technology – specifically mobile apps – make this remarkably simple. Whether online, through chat or with video calls, travelers can be instantly connected with someone who can cater to their whims or answer their questions in the moment. The right tools can allow travelers to feel like they have a concierge in their pocket.

Brands that extend heightened personal services without added costs via technology are in the best position to weather any kind of inflationary pressures. They even have the potential to upsell services.

Travel brands can use technology to engage with guests throughout the whole lifecycle of a trip – from planning stages through post-trip follow-up. For example, a brand might connect guests with other travelers who can share their experiences with different trip options in an online community or group chat, or perhaps new communication tools can be used to find upgrades.

Because discovery and bookings are more intertwined than ever, tech can empower brands to craft seamless experiences in conjunction with partners. For example, within a hotel’s app, a customer could book a room and add excursions, make dinner reservations nearby and much more. Enabling such integration not only saves travelers time, money and hassle – which makes them more apt to increase travel spending and/or to book future travel with the same brand – it also allows brands to forge alliances that can include referral kick-backs that further boost revenue at a time when every dollar counts.

Once a trip is in progress, guests can use one-click calling from the hotel’s app to book a massage from the golf course or ensure that champagne or fresh towels are waiting in the room. Similarly, brands can follow up with guests after their trips, via an online portal, video call or in-app survey to ensure that all was satisfactory and offer an assist with future travel planning. Technology provides a way to close (or even extend) the loop in a highly personal way that makes customers feel valued.

As the travel sector tries to find its footing again while facing the fear of another major economic slowdown, brands have to figure out innovative ways to make hitting the road a non-negotiable, something that consumers don’t want to go without. The best way to do that is by creating unforgettable experiences that engage people and make them feel special. Technology is the best enabler, facilitating quality interactions that make life easier and more enjoyable overall. It is the best way to alleviate the pain hitting consumers in the pocketbook.