Predictions for the travel and tourism industry in 2020

16 December 2019

After an unprecedented year in the Travel and Tourism Sector, in which we saw the largest failure in UK travel industry history, we look ahead to the big issues that businesses will face in 2020.

Clicks vs. Mortar

It would be remiss to look to 2020 without considering the impact on the industry from the demise of Thomas Cook; the biggest UK tour operator failure in history. The ripple effects throughout the industry after the immediate aftermath are still crystallising. Much comment has been made that a business as leveraged as Thomas Cook ‘needed to fail’ and its collapse was a ‘market correction’ with too much capacity in the market driving down prices for consumers to unsustainable levels.  The evidence to date indicates that excess capacity will remain an issue in summer 2020.  TUI have announced significant extra seats from regional airports, Jet2holidays is set to expand its ATOL licence by more than half a million passengers and we have seen the much-anticipated relaunch of EasyJet Holidays. The news that Hayes Travel bought the leases and staff of Thomas Cook’s shop network was welcome news to all in the industry, but who will win the clicks vs. mortar battle and what will all this mean for business’ margins in 2020?

A brave new world

Nothing changed following the calls for a reform of regulation within the travel industry after the collapse of Monarch in 2017. That was the biggest airline collapse in UK history at the time and the collapse of Thomas Cook in 2019 broke that record with 150,000 people left stranded and the Air Travel Trust Fund all but emptied. Is travel regulation still fit for purpose given the way the industry continues to develop with tailor made offerings and customers booking directly with airlines? 2020 must be the time to review how the travel industry is regulated in the brave new world.

The rise of Flygskam and social media shaming

As social media becomes a bigger part of everyday life the impact of public shaming is starting to be felt by tour operators and agents alike. Flygskam, the environmental movement of flight shaming, may be a relatively new phenomenon, but 2020 will see it gaining traction and coverage of this can only be expected to grow, alongside calls for more responsible travel.  Customers are also increasingly airing their complaints in public forums in order to use the bad PR as leverage for improved compensation. Travel businesses need to manage this carefully in order to appropriately compensate and address real issues and simultaneously identifying exaggerated or fraudulent claims.

Open to all

Traditionally framed as a niche within the travel sector, accessible travel has been underestimated by traditional tour operators for many years. Two fifths of adults live in a household where someone has a long-term impairment which limits their day to day activities. There are currently significant barriers in place to discourage these families and individuals from enjoying the current tourism boom.

Limitless Travel estimates the accessible travel sector is worth £12b to UK tourism alone.  We therefore question the risks to tour operators who are not doing enough to provide adequate information to customers and making reasonable and appropriate adjustments to arrangements being offered.
The new Package Travel regulations released in July 2018 required provision of information on suitability for persons booking with reduced mobility, this should continue to be an area of focus for businesses going into 2020.

The ‘gig economy’

Following the loss of Uber’s London license in 2017 and recent further revelations that 14,000 journeys were undertaken by unregistered drivers, London has once more suspended Uber’s license.  The appeals process virtually guarantees Uber will continue operating for at least a year more, but does this call into focus the travel industry’s use of the ’gig economy’ as a whole?

Whether it is the driver for an airport transfer, a tour guide or even the programmer who wrote the booking platform this will inevitably impact any holiday. Questions must be asked by both travel companies and travellers themselves as to whether any of these industries are using these workers in an exploitative way. Around 5 million people in the UK are employed within the ’gig economy’ which means they have no protection against unfair dismissal, no right to redundancy payments, and no right to receive the national minimum wage, paid holiday or sickness pay. In addition, with IR35 legislation coming into effect in early 2020, this will undoubtably be an area under the spotlight next year.

The rise of the podcast and audio

Whether it’s that catchy tune associated with TV adverts or the jingle that plays at the end, music plays a key part in product recognition. How many brands could you name just by hearing their jingle? To process music, studies show that we use the same parts of the brain that are responsible for emotion and memory, with both of these senses being associated with holiday experiences. The right choice of music can set the tone for a brand’s personality as well as targeting a specific type of customer. 2020 will see an increase in the use of podcasts and audio as an advertisement for holidays as well as maximising enjoyment whilst in resort. 

Find out more about how your business may be affected by future changes in the travel and tourism sector by contacting Ian Bell or Tim Robinson.