Volume: 9 Issue No: 1
Dear Friends and Colleagues:
I have recently returned from two days at the U.S. Travel Association Marketing Outlook Forum in Fort Worth, Texas. The presenters were attempting to paint a picture of the future, and after two days it looked more like a surrealist Picasso than a classic Rembrandt. There is a lot going on from a global macro economic level, as well as on the domestic front, which is affecting people's confidence and ability to move forward.
The current frenzied economic environment is a bit like that of an amusement park. The stock market is on a continuous roller coaster ride, some days doing wide swings of 360 degrees. Consumers are strapped in to the tilt & whirl while the politicians are stuck in the fun house using the most amazing mirrors to justify a lack of activity. They are not paying any attention to anything going on outside. At this theme park consumers seem to be the ones that are not having any fun but paying the price.
After the macro economic presentation from Adam Sacks of Global Economics, there was a much-needed scheduled break. I thought that the refreshments were going to be tequila shots to drown out the economic news, his predictions, and the numb fiscal reality.
Truth be told, there is a lot going on, and macro forces are causing waves of uncertainty; however, there are some bright spots and companies are sitting on lots of cash. On the consumer side, they want to feel a measure of control in their everyday lives. The need to stop the ride and get off for a few days to regroup, reconnect, and relax has never been greater.
Consumers will continue to search out and create time for a break from 24/7 news and global/domestic uncertainty. Travel marketers need to tap in to this need and give consumers an opportunity to check out and check in with family and friends. People are looking for connection, family time, and memories.
To quote a popular TV show: "Making your way in the world today takes everything you've got. Taking a break from all your worries sure would help a lot. Wouldn't you like to get away?"
It is essential that travel marketers touch consumers at an emotional level to meet their needs. Vacations, packages, and experiences that connect will resonate and reward savvy travel marketers. There is opportunity in the market!
The Opportunity Guy
The Consumer Hourglass Theory Necessitates A Bifurcated Tourism Strategy
With economic uncertainty and consumer confidence at record lows, what's a travel marketer to do? Some of the answers, I believe, may be found in the strategies of consumer products companies.
A fall article in the Wall St. Journal noted "As the middle class shrinks, P&G aims high and low." The strategy, it seems, also has a name courtesy of Citi Group: The Consumer Hourglass Theory. It denotes that the current economic picture has bulges of consumers at both the top and bottom of the markets, but the middle has been squeezed.
The WSJ article mentioned that P&G executives noted that many middle market shoppers are trading down to lower-priced goods. According to Melanie Healey, Group President of P&G North America, "It's required us to think differently about our product portfolio and how to please the high-end and lower-end markets. That's frankly where a lot of the growth is happening."
In addition, the article noted that H.J. Heinz Co. is developing more products at lower price ranges while luxury retailer Saks Inc. is bolstering its high-end apparel and accessories because its wealthiest clients are driving the chain's growth.
I believe the tourism industry should adopt a similar attitude with regard to marketing products, services, and experiences to test this market theory.
According to recent survey data from American Express, which tracks 90 million consumers, 127 markets, and 5 billion transactions, luxury continues to grow. Clearly, those at the top can afford it and will continue to travel. In fact, according to the American Traveler Survey, the wealthiest households took an average of 4.4 trips annually while mid-market travelers only took an estimated 3.7 trips.
Read the entire article >
The Marketing Outlook Forum Ouija Board 2011
On October 26 & 27, tourism industry marketing executives gathered for the annual U.S. Travel Association's Marketing Outlook Forum in Fort Worth, Texas. The event included presentations from industry experts on the pulse, trends, and future of the Industry. Here are some of the highlights:
- Today's customer is a complex consumer with very low confidence; October 2011 percentages match those of October 2008.
- Travel spending will exceed $800 billion for the first time ever with domestic visitors hitting a slight record.
- Shrinking middle class - luxury is hot and growing.
- Consumers are cautious (take risk away). Curation is key; conversations, not consumer pitches. Contentment - give meaning and context to life - memorable moments.
- Today, there are 45 million not-sure travelers - huge opportunity.
- Business travel is down, but stabilizing.
- There will be moderate gains in domestic leisure 2011-13.
- Luxury is huge growth segment for travel addition of young gen X and Y consumers.
- Luxury is Experiential -- feel special/"lifestyle."
- To attract consumers, engage in dialogue ≠ just sell me, the social currency of brands
- Go digital with strategy; move to mobile platforms (consumer multi-screen syndrome).
- There is a tightening in the sphere of personal life; family is very important to consumers.
- Flash sales grow - 29% of consumers bought travel products during a flash sale (6-8 days before).
- 36% of US population minority is not white.
- Emotional connections with consumers, meaning matters, human value equation - create intrinsic anchors with customers.
- Macro global trends impact domestic economic activities on a daily basis.
- Complex consumer of the past five years is totally different from the thirty years previous. There is crisis fatigue, psychological anticipation, cautiousness - lower risk, uncertainty, volatility.
For additional information and to check The Opportunity Guy's availability for a program or project, call Joe Veneto at (617) 786-9096 or e-mail him at Joe@OpportunityGuy.com.
For a complete listing of presentations and seminars, go to www.opportunityguy.com/speaking.htm.
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