This may be especially important in a year with potentially unprecedented inflation levels pushing consumer prices higher, combined with the ongoing pain of the Great Resignation, which has left airlines and hotels woefully understaffed. To help you make sense of it all and what it means for your business, we have compiled a list of the biggest tourism trends expected in 2023 and how they may impact you as a tour operator.

Tourism Trends 2023:  The Impact of Price-Driven Travel

One of the biggest forces impacting the travel industry this year is the economy. Global inflation rates are expected to remain higher than usual, and fears of an impending recession and cost-of-living crisis are already affecting people in many countries in Europe and the Americas. This means that most customers are pulling back on the amount of money they would normally spend, and price-driven travel is likely to be the most significant trend in 2023.

Although the impact of inflation on tourism is obvious, the good news is that while people are looking for ways to reduce their travel spend, it doesn’t necessarily mean that people are planning on going on fewer holidays. According to Skyscanner’s 2023 Tourism Trends report, around 46% of tourists plan to take the same number of vacations in 2023 as they did in 2022, and around ⅓ of people desire to take even more trips next year. However, rising costs and inflation are impacting where and how they spend their money, and most respondents said they are looking to visit cheaper locations compared to the past.

This trend is in line with a recent survey we conducted among tour operators to understand their hopes and fears for 2023. We found that 66% of respondents believe inflation will have a noticeable but not disruptive impact on their business, while 19% think it will have a profound effect. Fortunately, we’ve compiled a long list of things professionals in the travel industry can do to sell more during a recession.With our suggestions, you will be able to keep profits up and costs down.

Tourism Trends 2023: Changes in Traveler Demographics

In 2022, we saw the rise of “revenge travel,” where people made up for not being able to go on a vacation for a few years, causing everything from airfares to hotel rates to skyrocket. Tourism trends in 2023 point more toward a shift to conscious travel, where tourists look at their trips in a more holistic way. This includes traveling during off-peak seasons or to emerging destinations, making informed decisions about the businesses they support while traveling, and finding sustainable transportation methods.

The digital nomads and remote workers who helped support struggling tourism industry in destinations around the world during the COVID pandemic will continue to demand longer-term accommodations. This trend is expected to continue in the coming years as people continue to enjoy the benefits of remote work and countries around the world begin to offer digital nomad visas.

Meanwhile, the number of young, affluent travelers seeking unique experiences and embracing luxury as a lifestyle is expected to increase, as is the number of “solo and self-focused” travelers seeking experiences centered on wellness and mental health. Many of these solo travelers are women over the age of 55, and a large percentage of them choose to join a tour when traveling to countries they don’t feel comfortable visiting on their own.

Most importantly, travel has continued to become more inclusive, with a growing number of LGBTQ and POC travelers. Unfortunately, the fear of discrimination still exists. Creating a marketing campaign that includes marginalized travelers as well as a welcoming environment for all is the best way to target these audiences.

Across all these demographics, many people no longer view travel as a discretionary expense, but rather as an essential part of their lives. These types of tourists represent a noticeable shift from traditional tourist segments in the way they use their money, the amount of time they spend in a destination, and the expectations they have for the overall experience.

If you want to tap into these markets, it is imperative that you take steps to welcome and accommodate their unique needs. One way to do this is by offering a buy now, pay later payment (BNPL) method that allows guests to make purchases in equal installments. There are currently 360 million BNPL users worldwide, which are expected to grow to 900 million by the end of 2027. This payment method is popular with younger tourists and can be highly beneficial to travel companies, making high-value products more accessible to a broader demographic and encouraging them to book vacations they might not otherwise be able to afford.

The Rise of Emerging Destinations and Changing Travel Styles

In 2023, people are looking for destinations where they can stay longer while spending less than in the past. As travel styles change and people seek authentic and sustainable experiences at a more competitive price, they are increasingly turning to emerging destinations.

Locations such as Georgia, Turkey, Colombia, Bulgaria, El Salvador and Guatemala have benefited from this increase in price-conscious tourists. Meanwhile, economically volatile countries like Argentina and Brazil have suddenly become much more affordable, making them attractive to remote workers and digital nomads. Demand for “traditional” Western European destinations remains strong, with countries such as Portugal, Hungary and Croatia gaining in popularity. As we all know, this shift coincides with increased awareness and demand for sustainable tourism and ecotourism products.

Tourism Trends 2023: The Importance of Sustainable Tourism

The tourism industry has undoubtedly had a negative impact on both the natural environment and local communities. However, people are becoming increasingly aware of the impact of their travel decisions. It is becoming more and more important for destinations and businesses to offer sustainable travel options to consumers or risk losing these potential visitors to their competitors.

According to the UNWTO, sustainable tourism is “tourism that takes full account of its current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment, and host communities”. Over the past decade, sustainability has gone from a buzzword that both consumers and providers pay lip service to, but few actually take steps to support, to something that people actively seek and businesses offer.

Sustainable tourism has become an essential part of our industry, and tour operators are at the forefront of this movement. Not only adopting sustainable business practices help protect the environment in which you work and potentially live, but it can also make sense from a business perspective, as being “green” can also attract new customers.

In a recent Expedia survey, 90% of consumers said they look for sustainable options when vacationing. This means there is significant demand for sustainable travel providers. Furthermore, Euromonitor International reports that “73.8% of travel executives see increased interest in sustainability from their customers in 2022.” Perhaps more interestingly for the tour operators themselves, 57.3% of these executives noted that people are often willing to pay more for a tour or activity that they believe follows sustainable practices.

As an added bonus, people who want to travel sustainably are also inclined to visit off-the-beaten-path destinations for a more authentic and sustainable experience, which can be an incredible opportunity for companies operating in emerging destinations.

The Link Between Climate Change and Tourism

All around the world, mass tourism has been linked to environmental degradation, the depletion of natural resources and an increase in pollution. As tourists become more concerned about the impact of travel on both the natural environment and the communities with which they interact, the need for destinations and travel companies to adopt “green” policies is becoming more apparent.

Many destinations have chosen to implement various kinds of taxes to help offset the negative impacts of overtourism, while travel companies and hotels have looked at ways to reduce emissions associated with overnight stays and food consumption. Tour operators can easily do their part by booking direct flights for travelers, incorporating overland options whenever possible, promoting slow travel, and adopting new technologies that help reduce waste.

Tourism Trends 2023:  Using Technology to Enhance the Travel Experiences

You’ve probably heard about the many ways technology is transforming the travel industry. Technology companies like Regiondo offer booking systems that make it much easier to market and manage your trips, while ChatGPT, an AI language model that can be used to generate human-like responses to prompts, makes it easier to create content for your website. In addition, the demand for short-term rentals among business travelers, digital nomads and vacationers continues to grow as new distribution platforms enter the market and hotels continue to adopt technologies to offer more contactless services.

All of these changes can open new doors for you to market and sell your tours and activities as travelers become more reliant on travel technology and travel apps at all stages of travel, including planning, booking, and taking their trips. As a result, you can more easily reach your target markets without having to invest heavily in traditional advertising by simply offering your products on a variety of platforms. Although updating multiple apps and websites can be time consuming, Regiondo offers software solutions that can help you connect with leading OTAs, helping you save time and money.

Conclusions

The latest shifts in tourist demographics and the rise of price-driven travel can feel like trying to hit a moving target. However, in many ways, these trends are all interconnected. For this reason, even small changes to your product offerings and price points can have a far-reaching impact on your overall business.

For example, offering a high-value tour focusing on sustainable travel in an emerging destination can help you reach solo adventurers who are looking for environmentally-conscious experiences. Not only competition in that market will be much lower than in other destinations, but your profit margins are likely to be higher. Looking for opportunities like this can help you stand out amongst your competitors and encourages repeat business from satisfied customers.

While these are considered the most recent travel trends, the emphasis on sustainable travel and emerging destinations is unlikely to change as we move into the future. Focusing on these aspects can not only help you gain more customers now but it can also help you build a strong business model moving forward. Similarly, investing in improving your digital infrastructure will help you get more bookings for years to come, not just in 2023. If you want to learn more about Regiondo, the leading booking system for tour operators and activity suppliers, feel free to book a demo with one of our consultants.

The post Tourism Trends 2023: What Tour & Activity Providers Should Expect appeared first on Regiondo.

As marketers well know, choosing the right title for your content is more important than the content itself. You could write an insightful article with impeccable style, but no one will read it if it doesn’t feature a catchy headline. Even if we like to pretend to be sophisticated and rational beings, we can’t help but judge books by their covers – literally. This is even more true in the digital age we are living in. We are constantly bombarded by a plethora of conflicting stimuli, to the point that we find it difficult to focus our attention on a particular piece of text for more than a few minutes. If you’re dedicating your time to this article instead of watching a reel on Instagram, it must mean I was able to come up with an amazing title, right? Unfortunately, I can’t pat myself on the back for this achievement because it was suggested to me by an AI, just like all the phrases enclosed in quotation marks that you will find in this post. At first glance, it seems that chatbots can be good copywriters, but what else can they do? In particular, can ChatGPT be useful for professionals in the travel industry?

If you’re looking for strategies and tools to streamline your business during the difficult economic conjuncture we’re living, check out our latest guide: How to sell more during a recession.

There’s a good chance you’re already familiar with ChatGPT, the state-of-the-art chatbot (or, to be more precise, language model) launched by OpenAI in November 2022. If you’ve already tinkered with it, you may still have some lingering questions. For example, what are the advantages of using ChatGPT? What are the main drawbacks? Are there other AI-powered tools that can automate menial tasks? With the help of my new AI friend, I will clarify all your doubts in the following paragraphs.

What’s ChatGPT?

Before discussing if ChatGPT is a viable solution for professionals in the travel industry, it’s essential to clarify what it really is. When I asked it to provide a comprehensive answer to the question, I received this answer:

“ChatGPT is a language model developed by OpenAI. It is based on the transformer architecture and has been trained on a massive amount of text data to generate human-like responses to a wide range of questions and prompts. It is designed to perform a variety of natural language processing tasks, including text generation, translation, question answering, and summarization, among others.

For example, you could ask ChatGPT about the weather in a specific city, and it would respond with the current temperature and conditions. Or, you could ask it a question about history, and it would provide a comprehensive answer. The goal of ChatGPT is to make it easier for people to find information and get answers to their questions without having to search through multiple websites or books. It can also be integrated into conversational interfaces such as chatbots, allowing organizations to provide a more personal and interactive experience for their customers. The technology behind ChatGPT continues to advance, and it is expected to have a significant impact on various industries, including customer service, e-commerce, and marketing, among others.”

What are the main drawbacks of ChatGPT?

It is no accident that I asked the popular chatbot for a detailed answer to my previous question, because its limitations become more apparent when it tries to provide an in-depth analysis of any given topic. Below, we’ll see why using ChatGPT may not be the best idea for professionals in the travel industry.

ChatGPT is not so intelligent after all

ChatGPT is an outstanding technical achievement and one of the most advanced AI tools out there, but it is still computer software at its core. This means that it is not able to “think” as a human being does, it can’t develop original thoughts or insights based on the information it knows, and it tends to be extremely formal.

As a language model, it has been trained on a humongous text dataset and uses statistical techniques to learn common patterns in a given language. What ChatGPT does is predict what words it should use given a specific input, meaning that it can’t really “speak” in the most traditional sense of the term, but it’s more than capable of imitating human language. To give you an example, a simple language model trained on a dataset of English sentences, when given the prompt “The cat is sitting on the,” would generate a word that comes after the aforementioned line of text in most sentences, like “floor” or “mat.” Such language models always generate words that appear frequently in most sentences after a given line of text. ChatGPT is more advanced than that and can elaborate full answers to questions, write longforms, and much more.

ChatGPT may lie to you

Technically, ChatGPT can’t lie, given that it lacks both a moral system and the ability to consciously deceive the people it’s talking with. As we have seen, it is also unable to think and discern what’s true from what is false. I’ll repeat it for emphasis: ChatGPT can only use statistical probability to pick – given a certain input – relevant data from its archive. What I’m trying to say is that our beloved AI-powered chatbot may not lie, but surely it can provide wrong pieces of information if they’re part of its knowledge repository.

Take another read at ChatGPT’s answer to the following instruction, “Please tell me in detail who you are and what you do.” Got the answer? Did you notice that it contains an inaccurate statement? In fact, it’s also not true that it can tell you the current weather conditions and temperature for a location! If you don’t believe me, give it a try straight ahead. We can only speculate about why it told me it would be able to perform such a task. In all likelihood, giving information about the weather is referred to as a typical example of what AI can do in multiple texts featured in its database. The bottom line is that you should double-check everything ChatGPT says, especially if you’re asking it to create content that your customers will be reading and sharing.

ChatGPT will give you outdated information

If you’ve talked with ChatGPT about recent events, you may have noticed that it can provide you with outdated information. This is because, as a language model, it can’t access the internet to look for the latest news. It can only make use of the data that is already present in its database, which was last updated at the end of 2021. As you can imagine, updating this gigantic dataset in real time wouldn’t be feasible, given that the AI needs plenty of training time to elaborate it correctly. For this reason, using ChatGPT to create marketing content for your tour & activity business can be a little bit tricky. It can help you craft a fantastic headline for your latest blog post, but – for example – it can’t compose a whole article dedicated to the latest tourism trends with correct and updated info.

What are the advantages of using ChatGPT in the travel industry?

According to ChatGPT itself:

“ChatGPT can offer several advantages for tour and activity providers:

1. Data analysis: ChatGPT can process large amounts of data, such as customer interactions and booking history, and use that information to generate insights and make predictions. This can help tour and activity providers make data-driven decisions about pricing, promotions, and product development.
2. Automated marketing: ChatGPT can be used to create and distribute targeted marketing campaigns to customers. This can help tour and activity providers reach new audiences and drive more bookings.
3. Product development: ChatGPT can be used to analyze customer feedback and preferences, helping tour and activity providers understand what types of tours and activities are most in demand. This information can then be used to develop new products and improve existing offerings.
4. Increased scalability: By automating many routine tasks, ChatGPT can help tour and activity providers scale their operations and handle a growing customer base without adding additional staff.
5. Improved customer experience: By providing personalized and proactive customer interactions, ChatGPT can help tour and activity providers create a better customer experience, which can lead to increased loyalty and repeat business.
6. Customer service: ChatGPT can be used to provide quick and efficient customer service by answering frequently asked questions and helping customers make bookings. This can help reduce the workload of customer service representatives and improve customer satisfaction.”

Other than ChatGPT, what are some useful tools for professionals in the travel industry?

Is ChatGPT really useful for businesses in the travel industry? In my humble opinion, AI-powered tools aren’t yet polished enough to be used in a professional setting. At the moment, their limitations far outweigh the perks, given that you can’t trust the accuracy of the information they provide. On the other hand, compared to AI bots, automation software is a more reliable solution for those who want to streamline their workflow and processes. For instance, booking systems are programs that allow digital reservation management, online ticket sales, and connection to online travel agencies (OTAs). Regiondo, the leading player in this field, is an effective tool that can streamline your business operations and eliminate the need for paper. Furthermore, it can save you money by automating repetitive tasks, which is particularly useful if you have limited staff and difficulty hiring new employees. Here are some sleek processes you can implement with a modern booking system:

• Synchronize your offers and availability across multiple OTAs and resellers through the channel manager.
• Send automatic customer notifications for bookings, cancellations, and other transactions.
• Utilize automated feedback requests after each booking to increase customer reviews.
• Enable 24/7 online bookings without any manual intervention.

It’s worth noting that an all-in-one booking system already includes all the necessary tools for running a tour and activity business, from the channel manager to the POS, thus saving you the cost of purchasing separate tools from different providers.

Conclusion

As we can see, ChatGPT is a technical marvel, but it’s not reliable enough to be used by professionals in the travel industry. Luckily, there are other solutions to help you in your daily work. A booking system can effectively reduce expenses by simplifying repetitive tasks, automating the reservation process, and easily managing multiple distribution channels. To gain a deeper understanding of the benefits of using Regiondo, the premier booking software for tour operators and activity providers, you can schedule a free demonstration with one of our specialists.

The post ChatGPT for the travel industry: pros and cons of using AI tools appeared first on Regiondo.

Although the Covid pandemic is behind us, tourism is still struggling to reach 2019 levels. As reported by Statista, the war in Ukraine, the subsequent disruption to the supply chain, and the increasing feedstock prices (crude oil, corn, etc.) have cast a shadow on recovery. To make sense of this scenario, the Regiondo team has interviewed over 140 tour operators, activity providers, and other professionals in the travel sector. We asked them about their hopes and fears for 2023, so we could better understand what to expect over the upcoming months. The whole survey revolved around the question, “What’s the main challenge you will face in 2023?” As expected, almost half of the respondents answered with “inflation.” The impact of inflation on tourism can be disruptive, and that’s probably an understatement.

Do you want to know more about the challenges tour operators and activity providers will face in 2023? Download our infographic to get the latest insights – Click here.

For tour operators and activity providers, being aware of the current market dynamics is the best way to maintain profitability in the face of declining consumer confidence and spending. Understanding the economic implications of inflation and its effect on our industry will help businesses make informed decisions to stay afloat during these challenging times. In the following paragraphs, we’ll tell you everything you need to know about the topic and suggest a few proven strategies to increase your bookings despite the gloomy economic situation. With our help, you’ll be able to face any upcoming challenge and emerge even stronger on the other side.

Understanding the impact of inflation on tourism

Before we analyze in depth the impact of inflation on tourism, it’s crucial to clarify the very definition of this term. The Cambridge Dictionary describes inflation as “the rate at which prices increase, or an increase in prices.” More precisely, we speak about inflation when there’s an overall increase in the prices of goods and services, which translates into the decline of customers’ purchasing power over time. When inflation rises, the currency loses value, meaning you can buy less with €50 today than you could yesterday. It’s important to note that inflation and recession – even though they often go hand in hand – are not synonyms.

For the Cambridge Dictionary, a recession is “a period, usually at least six months, of low economic activity, when investments lose value, businesses fail, and unemployment rises.” Also, it is usually characterized by a decrease in the gross domestic product (GDP) – a monetary indicator that measures the size of the total economic activity of a country during a specific timeframe. Keep in mind that we can speak about recession only if the economic decline is at the same time widespread among multiple industries, protracted and substantial.

It’s clear that inflation and recession are different concepts, but what’s the relationship between them? Well, as you can easily imagine, they’re strictly interlinked and can co-exist simultaneously. More often than not, one is the cause of the other. For example, inflation can lead to a slowdown in the economy (recession) as the costs of raw materials and labor increase. It can also happen that governments take measures to slow down the economy in an effort to contrast inflation, which can result in a recession or, in severe cases, deflation.

With rising inflation, travel is arguably one of the hardest-hit segments since customers tend to cut discretionary spending when their purchasing power decreases. 99% of the over 140 industry professionals that responded to our survey believe that inflation will drive tourists to alter their holiday plans, causing a notable rise in short-term bookings. 85% of them also fear that the economic conjuncture will have a significant negative effect on their business.

Statista, one of the leading online platforms dedicated to market data, has confirmed our findings in a recent series of surveys. According to their data, one out of three American travelers has decided to pick a cheaper destination in 2023 compared to the previous years. Similarly, 86% of Brits between 25 and 34 think inflation will impact their holiday decisions.

Ways to cope with the impact of inflation on tourism

Tour operators and activity providers have faced numerous challenges over the years, and the recent rise in inflation has only compounded those difficulties. To curb the impact of inflation on tourism, professionals in our industry can rely on some proven approaches. These include adopting cost-saving strategies, investing in marketing and promotional campaigns, exploring alternative revenue streams, constantly adapting to changes in consumer behavior, and enhancing innovation activities and investments.

Cost-saving strategies

Adopt green policies

Reducing unnecessary expenditures is paramount to preserving your profit margins during periods of economic uncertainty. Identifying areas of your business where you can effectively cut costs will require plenty of time and hard work, but there are some simple steps you can start taking now to find the right balance. We suggest killing two birds with one stone by adopting a few environmentally friendly policies that can also help save some money. For starters:

• Replace your lightbulbs with energy-efficient (LED) ones.
• Make better use of natural light to reduce energy consumption.
• Switch off electronics and unplug chargers when not in use to save standby power.
• Avoid disposable supplies of any kind.
• When possible and if applicable, allow employees to work from home.
• Invest in energy-efficient appliances and equipment made from recycled materials.
• Go paperless with the help of a booking system.

Automate tasks with a booking system

To elaborate on the last point, booking systems are applications that allow you to digitally manage reservations, sell tickets online, and connect with the major OTAs. Regiondo – the leading software in this category – is an effective tool to digitalize your business and say goodbye to paper. Not only that, it can also help you further reduce your expenses by automating menial tasks and administrative work. Automation can be a real lifesaver if you’re short on staff and have trouble hiring new employees. Here are a few examples of some neat processes you can set up with a state-of-the-art booking system:

• Automatically sync your offers and update availability across multiple OTAs and resellers from the channel manager.
• Enable automatic customer notifications, including booking confirmations, cancellations, and other transactions.
• Make use of automated feedback requests after each booking to collect more customer reviews.
• Accept online bookings 24/7 with no human intervention required.

Keep also in mind that an all-in-one booking system already includes all the tools needed to run a tour and activity business efficiently – from the channel manager to the POS – so you can save money on third-party tools.

Zero-based budgeting

A more advanced strategy to save money is to adopt zero-based budgeting. The idea behind this methodology is to start from scratch and allocate each expense based on current needs and priorities rather than using last year’s spending as a baseline. As a result, your income minus your expenditures should equal zero by the end of a specific financial period. Furthermore, every single expense must be justified with consideration of its impact on the company’s bottom line; this significantly helps organizations in determining which costs are essential and which can be reduced or eliminated. In other words, zero-based budgeting aims to ensure every investment is aligned with the organization’s goals and that resources are allocated efficiently.

Marketing and promotional campaigns to curb the impact of inflation on tourism

Tour operators and activity providers know well that leveraging digital marketing is key for any successful business. What they’re probably wondering – considering the devastating impact of inflation on tourism – is what strategies they must adopt to reach a new audience during a period of crisis. Below you can find our recommendations.

Stay true to your brand

Branding is all about differentiation and staying true to your company’s unique characteristics. Remember that those elements that make your value proposition stand out do not magically become unappealing just because we might be in a recession. For these reasons, sticking to your message during an economic downturn while others retreat is a huge opportunity to reinforce your brand’s unique qualities and prevent it from becoming a commodity. By adhering to your authentic identity, you can stand out from the competition and provide clear reasons for customers to remain loyal. The bottom line is that falling into the trap of embracing the lowest common denominator won’t help you reach a new audience, quite the opposite!

Focus on the hidden perks of traveling

Over the years, numerous studies have shown that going on vacation can reduce stress levels, improve psychophysical well-being, and enhance the overall quality of life. Furthermore, travel provides the opportunity to connect with family, which has become increasingly important in recent years. With the potential for an economic downturn in 2023, it’s crucial for tour operators and activity providers to highlight these benefits in their marketing and advertising campaigns.

Highlight the added value of your offers

During the Covid pandemic, tour operators and activity providers have learned that flexibility is the name of the game. This remains true during a recession, when customers may experience feelings of anxiety and uncertainty. To preemptively address any doubts they may have during the reservation process, it would be mutually beneficial if you could offer them easy cancellations, hassle-free refunds, and extended customer support. We suggest prominently highlighting these perks both in the description of your offers and in the copy of your ads because they can decide whether a traveler books your experiences or not.

Finding new revenue streams

One way to mitigate the impact of inflation on tourism is to diversify income by exploring alternative revenue streams. This can include offering new products or services, expanding into new markets, or forming partnerships with other companies in the industry.

To give you some food for thought, did you know that – according to travel industry news site Skift – the wealth of high-end consumers is increasing faster than inflation? Therefore, tour operators and activity providers should not shy away from putting a premium on the prices of services and packages that cater to this demographic, like offering the possibility to book a transfer from your customers’ hotel to the site where your experience takes place and charging more for such services. On the other end of the spectrum, you may choose to attract a higher number of “budget-conscious” tourists by offering more bare-bones versions of your tours or giving them a chance to book using a Buy Now, Pay Later service.

Adapting to changes

As you can imagine, staying attuned to your target market’s changing behavior, desires, and travel patterns is crucial. This means being open to new ideas, experimenting with different approaches, and staying ahead of industry trends. As suggested above, companies can offer more flexible booking and cancellation policies, embrace sustainable tourism, and offer virtual or hybrid travel experiences to appeal to a changing customer base. Keep also in mind that the impact of the recession on customers’ choices can be so massive that it might change the demographic interested in your value proposition entirely. According to a Semcasting report that analyzes the influx of tourists in Cape Cod, the destination has registered a 60% increase in baby boomers visitors in 2022 compared to the previous year. At the same time, the number of millennials visiting has decreased by 40%, because they were hit the hardest by inflation.

By being proactive and adaptable, tour operators and activity providers can weather the economic turbulence and emerge from the recession even stronger.

Don’t be afraid to innovate

As extensively explained in this post, finding ways to save money is an absolute priority during a recession. That being said, you need to strike the right balance between cutting costs and pursuing innovations that can help you generate more revenue. In our survey on trends in 2023, we asked our interviewees about their plans for keeping up with the competition. 67% answered that, despite the economic situation, they plan to invest in improving their online presence.

Luckily, you don’t need a huge budget to reach this goal. For instance, did you know you can create and update your company’s official website all by yourself instead of contracting an expensive communications agency?

Website builders are applications that allow you to create a web page by simply adding your content to a pre-made template that can be personalized in every single detail. It’s cheap, takes only a few minutes of your time, and you don’t need to learn how to code to get amazing results. If you want to learn how to create a booking website for tour operators and activity providers with Regiondo’s website builder, check out this guide.

Conclusion

As we have seen, the impact of inflation can be disruptive, but applying the right strategies and adopting some smart tools can help you navigate the tides of economic turbulence with ease. In particular, using a booking system can help save costs by streamlining menial tasks, automating the reservation process, and managing multiple distribution channels with a few clicks. To learn more about Regiondo, the leading booking software for tour operators and activity providers, you can book a free demo with one of our consultants.

The post The impact of inflation on tourism: navigating the economic storm appeared first on Regiondo.

Learn more about how Regiondo can help you go paperless, get more reservations, and connect with the major OTAs – Click here

We like traveling so much that we tend to underestimate the toll it takes on the lands we visit and the communities they host. It would take a dedicated article (and probably it wouldn’t be enough) to describe all the negative environmental impacts of traveling. Here is a brief list of the most common problems linked to intensive tourism:

• Depletion of local natural resources (especially in places where they’re already scarce). The situation is incredibly concerning regarding the overuse of water, given that tourism accounts for 1% of global water consumption.
• Increase in pollution, including noise and light pollution. According to the latest studies, tourism is responsible for approximately 8% of the world’s carbon emissions.
• Increase in the generation of waste.
• The stress put on the use of local land leads to soil erosion and disruption of the natural habitat, which harms even more already endangered species.

Tourism can also have detrimental economic and sociocultural repercussions. For example, in the most popular tourist locations, the cost of living can increase dramatically, particularly when it comes to rental rates and real estate prices. This can make it difficult for locals, and even more so for workers in the leisure industry, to buy or rent properties.

Thankfully during the last few years, an increasing number of people have become aware of the necessity to adopt a more responsible approach to traveling. Sustainable tourism is one of the trends that will shape the future of our industry in 2023, and there’s no going back. But what do we mean precisely by “sustainable tourism”? Why should tour and activity providers care about sustainability? And more importantly, what are the most effective strategies to make your business green-friendly? In this article, I’ll give a detailed answer to all the questions you might have on this topic.

What is sustainable tourism?

Sustainable tourism is a broad concept that covers the travel experience in its entirety; so, it can be tricky to provide a comprehensive yet clear definition. The World Tourism Organization describes it as “Tourism that takes full account of its current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment, and host communities.” For UNESCO — the United Nations agency dedicated to promoting education, sciences, and culture — sustainable tourism can be seen as “tourism that respects both local people and the traveler, cultural heritage and the environment.”

Expedia — the famous online travel agency — in the 2022 edition of its sustainable travel study, asked 11,000 consumers from all over the world to list what they believe are the most significant aspects of sustainable tourism. The four top answers were:

1. Lessening environmental impacts
2. Supporting local economies
3. Supporting local cultures and communities
4. Visiting lesser-known destinations

In general, sustainable tourism is about being mindful of the destructive impact tourism can have, minimizing it as much as possible, and repairing the harm caused in the past.

Why should tour and activity providers care about sustainability?

As the climate crisis unfolds, it goes without saying that working to implement more sustainable practices in the tourism industry is important from a moral standpoint. What most tour and activity providers ignore is that a green-friendly approach can also be beneficial from a business perspective. Below, you can find a series of statistics from the Expedia study mentioned above and the Sustainable Travel Report 2022 by Booking.com, clearly showing that there’s a huge market for companies catering to eco-travelers:

• 90% of consumers already look for sustainable options when traveling, with four out of five customers confirming that sustainable tourism is a topic they care about.
• Travelers’ preferences have already shifted toward favoring more sustainable options. Three in five respondents to the Expedia survey claim they have effectively opted for more environmentally friendly means of transportation or lodging while traveling during the last couple of years (2021-2022).
• Refusing to embrace the green revolution will not only make it challenging to acquire new customers but could also antagonize your existing ones, and faking your commitment is not an option. In fact, over the last two years, 70% of consumers have avoided a travel destination or a transportation option because they were skeptical about the effectiveness of their sustainability practices.
• Ecologically conscious travelers are usually high spenders. On average, these consumers are willing to pay up to 38% more to curb the environmental impact of their travels. What’s even more interesting is that 53% of the users interviewed by Expedia affirmed they are willing to pay a premium to participate in sustainable tours and activities. 70% of them would also be keen to sacrifice some comfort and amenities to become more sustainable tourists.
• Paying attention to sustainability can also put your business on the map, especially if your business is not located in a popular destination. Over the last twelve months, 27% of consumers have decided to visit some less-known tourist attractions to avoid overcrowding.

What are the main challenges related to sustainable tourism?

Shifting to a more sustainable business model is quite challenging: you can’t just flip a switch and magically become a green-friendly tour and activity provider overnight. It will require plenty of work on your side, and even if you succeed, it can be tricky to communicate your efforts to the public in a clear way.

Today, most consumers feel overwhelmed when starting the process of becoming more conscious travelers. First, travelers have a hard time finding information about actual green practices adopted by tour and activity providers. The lack of a widely accepted green-friendly certification makes the research even harder for those travelers that only have a limited amount of time to conduct their research. Furthermore, even when this information is available, users are not always able to understand at a glance the real-life benefits these measures can have. Last but not least, you need to consider that for every tourist willing to pay more to support green tourism, there’s one that thinks it costs too much to travel in a sustainable way.

To attract eco-minded consumers and efficiently communicate your value proposition, you should craft a marketing strategy inspired by the following principles:

Transparency

Make things easier for your customers, and give them updated and truthful information on all the relevant green policies applied by your company. You can add this information to the descriptions of your experiences or on a dedicated page of your official website.

Clarity

Describe your sustainable initiatives with clear and concise language, avoiding any industry-specific jargon. If you have a green certification, proudly show it on your website, especially on your product pages.

Rewarding the end-user

Educate your clients about the positive impact of choosing an eco-friendly tour or activity. Another strategy is to give them tools, preferably in the form of dedicated content, to share their sustainability efforts with their peers on social networks. If you want to go the extra mile, you could also gift them a gadget or a small trinket to reward their positive choice.

How to make your tour & activity business more sustainable

As mentioned above, shifting your tour and activity business toward a more sustainable approach will take time and hard work. Right now, you may feel confused and unsure about your next steps. Luckily, we’ve got you covered.

Start from your office

Starting with baby steps is the best way to launch a project that is successful and sustainable in the long run. Take a deep look at your business practices and identify areas where you can reduce your environmental impact. This might include:

• Switch to energy-efficient (led) light bulbs.
  • Make a conscious effort to take more advantage of natural light.
• Turn off electronics and unplug chargers when they are not in use to reduce standby power consumption.
• Choose environmentally friendly and non-toxic cleaning products while avoiding disposable ones like paper towels.
• Encourage coworkers to carpool or use public transportation to reduce the environmental impact of commuting.
• When possible, offer the option for employees to work from home, which can reduce both the environmental impact of commuting and energy use in the office.
• Set up recycling bins and ensure employees know how to use them properly. Remember to properly dispose of electronic waste, such as old computers and printers.
• Use energy-efficient appliances and equipment, even better if made from recycled materials.
• Consider offsetting your carbon emissions through carbon credits or other programs.
• Go paperless with an online booking system that allows you to manage reservations and all your administrative tasks.

Support the local community and economy

• Work with local suppliers and vendors to source your materials and services; you could also establish partnerships to offer joint tours or packages. Furthermore, try to highlight local products or crafts during your tour and activity experiences.
• Offer eco-tours or activities that showcase local flora and fauna or that support conservation efforts in the area.
• Partner with local conservation organizations to sustain their efforts, and incorporate their missions into your tours or activities.
• Hire local staff to work on your tours or activities.
• Help your customers be more eco-friendly by providing them with recycling bags. Also, avoid single-use plastics and offer reusable water bottles for sale or rent.

Promote local culture

• Make sure that your tours and activities are culturally sensitive and respect the traditions and customs of the local community. Avoid activities that exploit or disrespect local cultures.
• Encourage your clients to respect local cultures and traditions and inspire them to learn more about local customs.

Conclusions

As we have seen, going green can benefit both the environment and your bottom line. It can seem daunting initially, but if you start from the basics, everything else will come along. Even switching to led light bulbs can make a huge difference: every gesture counts if it helps improve our world. Another good practice is to digitalize your company with a booking system, so you can stop wasting tons of paper.

Regiondo, the all-in-one booking system for tour and activity providers, allows you to easily automate and manage administrative tasks online so you can focus on more business-critical tasks. Schedule a demo today to learn more about how we can help you streamline your operations, connect with the leading OTAs, and sell more online.

The post Why sustainable tourism matters for tour and activity providers appeared first on Regiondo.

Buy Now, Pay Later services have profoundly changed our spending habits, and there’s no going back. According to Juniper Research, as of 2022, there are over 360 million BNPL users across the globe, and the number is poised to grow exponentially over the next few years.

From a business perspective, I’m sure you have plenty of questions about this emerging trend. For example, how does Buy Now, Pay Later work? What are the main benefits of this type of financing for tour and activity providers? More importantly, what do you need to do to be able to accept BNPL payments? In this article, I will clarify all your doubts regarding the topic.

What is Buy Now, Pay Later?

Buy Now, Pay Later empowers customers to divide a purchase into multiple installments, with the first installment usually due at checkout. BNPL services are a ubiquitous presence on the web, especially after the surge of online shopping driven by the Covid-19 pandemic, and most people associate these services with shopping online, but in fact, you can also use many of them in physical stores.

How does Buy Now, Pay Later work?

Each Buy Now, Pay Later service offers unique perks, but essentially — at least from the perspective of the end user — they all work in the same way:

1. When shopping at a participating retailer (both online and in-store), customers can opt for BNPL at checkout.
2. They will need to fill out a form by providing their personal information and a valid payment method (usually a debit or a credit card).
3. The BNPL provider quickly evaluates the request; users will receive confirmation in a few seconds.
4. The purchase will be split into a series of equal installments, the first of which is due at checkout. Usually, small purchases can be divided into interest-free payments.

What are the leading Buy Now, Pay Later services?

In Europe, the most influential players in this industry are Klarna and PayPal.

Klarna is a Swedish fintech company founded in 2005 by Sebastian Siemiatkowski, Niklas Adalberth, and Victor Jacobsson. Today, it’s a multination conglomerate with more than 4,000 employees located all over the world, from Australia to the United States.

PayPal is one of the first and most renowned payment processors for online transactions. The company currently ranks 143rd in the 2022 Fortune 500, an annual list of the largest United States corporations by revenue.

Klarna and PayPal allow customers to split a purchase into three interest-free installments with no set-up fees or additional charges. The first payment is made at checkout, while the remaining ones occur on the same date during the next two months. For instance, if you buy a 90€ item on October 15 using a BNPL service, you’ll have to pay 30€ at the point of purchase, while the same amount will be automatically charged to your payment method on November 15 and December 15.

PayPal “Pay in 3” can be used on purchases ranging from 30€ to 2,000€. On the other hand, there’s no predefined spending limit when using Klarna. That being said, every payment is subject to approval based on factors such as the customer’s payment history and outstanding balance.

Please note that Klarna and PayPal offer different conditions to their users in the United States. Both allow clients to divide purchases into four interest-free, bi-weekly payments. People can also opt for six-, twelve-, or twenty-four-month payment plans, which usually come with interest and fees.

Buy Now, Pay Later trends & statistics

Buy Now, Pay Later has become one of the most noteworthy trends in the retail space over the last couple of years. Below you can find a selection of statistics that can help you better understand the extent of this phenomenon and how you can take advantage of its popularity.

• I’ve already mentioned that 360 million customers worldwide use Buy Now, Pay Later services. According to the latest statistics, the number of BNPL users will reach 900 million by the end of 2027.
• A survey by The Ascent shows that 50% of Americans have used a BNPL service at least once in 2022.
• According to the same study, 62% of BNPL users are confident that these services can replace credit cards in the near future.
• Buy Now, Pay Later is wildly popular among the younger generations. A research by Insider Intelligence tells us that in 2022, 73,2% of the BNPL users were either Millennials (people born from 1981 to 1996) or Gen Zers (the demographic cohort spanning from 1997 to 2012).
• Similarweb – the popular web analytics company – has found out that e-commerce companies offering BNPL services average a 2.1% higher conversion rate compared to those that don’t provide this kind of option.
• 59% of the respondents to a “C + R Research” survey answered that they had used at least once BNPL to purchase “an unnecessary item that they otherwise couldn’t afford.”

Buy Now, Pay Later for the travel industry: What you should know

The statistics above show how important BNPL is in retail and how this trend will likely grow even more during the next few years. From the customers’ standpoint, it is easy to understand why these services are booming. They give much more flexibility than credit cards while, at the same time, having a much easier approval process and lower (if not nonexistent) interest rates. It’s no secret that customers are more than happy to take advantage of Buy Now, Pay Later when it comes to discretionary spending. To quote the podcaster and consumer expert Clark Howard: “The reason it [BNPL] does so well, the reason more than half of Americans have used it, is that it gives you the perception that you can afford it. It’s the perfect example of consumer psychology. People want the green light to spend money, when they know they shouldn’t.”

BNPL is already having a profound impact on the travel industry. In an Atmosphere Research survey, 40% of those polled declared that using Buy Now, Pay Later made it possible for them to take their latest vacation. Here are some of the most noteworthy news related to the adoption of BNPL in the travel & leisure segment:

• In November 2022, Trip.com – one of the largest online travel agencies out there – established a series of strategic partnerships to offer its customers in the UK and Pacific Asia the chance to spread out their purchases. With Klarna, Trip.com users in the United Kingdom can split their payments into three installments over 60 days. Atome provides similar options to the users in Singapore, while people living in other Asia Pacific regions will have to wait until 2023.
• Amadeus – the well-known IT provider for travel and leisure – is collaborating with Uplift and Fly Now Pay Later to integrate a BNPL solution into its Xchange Payment Platform. Thanks to these partnerships, travel agencies, hotels, and airlines can easily offer Buy Now, Pay Later to their customers.
• Speaking of Amadeus, the tech company has surveyed 4,500 travelers from Germany, France, the UK, the USA, and Singapore regarding their travel plans for 2023. For 42% of them, traveling abroad is the top priority in the “discretionary spending area.” Furthermore, 75% of the respondents claimed they would likely use BNPL to fund said vacations.
• Delta Air Lines, a leading airline in the United States, is giving owners of an Amex card the option to buy tickets via Plan It, a BNPL service developed by American Express itself.
• Carla, a car rental app growing progressively popular both in the USA and Europe, has brought BNPL to its clients through a partnership with Affirm.

Benefits of Buy Now, Pay Later for tour and activity providers

Buy Now, Pay Later is already changing the spending habits of most travelers, and it’s easy to understand why customers love this new payment method so much. But what are the benefits for you as a provider of tours and activities? We’ve already spoken about higher conversion rates, but there are plenty of enticing perks in adopting BNPL.

Expanded customer base

Allowing people to divide payments into interest-free installments will help attract people usually priced out by your offers. In particular, you will be able to entice younger customers, given how widespread BNPL is among Zoomers and Millennials.

Improved customer experience

In general, customer satisfaction skyrockets when users are given their preferred options, and that’s particularly true when it comes to payment methods. As you already know, satisfied customers are easier to retain and have a higher lifetime value.

Increased average customer spend

Afterpay, a US fintech company, claims that adopting BNPL empowers merchants to increase the average order value by 18%. Affirm, a competing provider, has declared that the average order value of purchases made via BNPL is 85% higher than the ones paid using other methods.

Reduced cart abandonment rate

According to the latest statistics, the average cart abandonment rate for e-commerce (e.g., the number of initiated transactions that don’t lead to purchase) is around 70%. There are multiple reasons for this phenomenon: some users simply like to do some “window shopping,” while others could have second thoughts regarding the amount they’re spending or can’t find their preferred payment method. According to a Mastercard survey, offering BNPL at checkout can reduce the abandonment rate by up to 35%.

Lower cancellation rates

Users can second-guess their purchase even after completing the payment at checkout, especially when they book a tour or an activity well in advance. In similar cases, they will likely cancel their reservation and ask for a refund. Installment payments make purchases easier on the wallet, reducing the chances of cancellations.

How to accept Buy Now, Pay Later payments

At this point, you’re probably wondering what you need to do to start accepting Buy Now, Pay Later payments. Luckily, the answer is pretty straightforward.

First, you need to integrate a booking system into your website. Booking systems are web applications that let you sell tickets online and manage bookings. The best software in this category is Regiondo, an all-in-one solution for tour and activity providers designed to increase revenue, save time, and reduce operational costs. Regiondo supports multiple payment methods, including Klarna and PayPal, the two leading BNPL services in Europe. With our booking system, you can also offer your customers a more “traditional” form of deferred payment by asking for a deposit at checkout and collecting the remaining amount when the customer arrives on-site. For further information, don’t hesitate to book a free demo with one of our consultants.

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