In an industry replete with savvy entrepreneurs, creative operators and skilled marketers, there are a few who not only keep their finger on the pulse of the travel business but also are a driving force behind the heartbeat of their niche. These Titans of Tourism help to guide and shape our industry in numerous ways, from supervising associations and building communities, to developing innovative tools and creative applications for existing practices. Leisure Group Travel has sought out five such Titans and asked them to share with us insight on the changes and trends within their organizations and how it affects our industry at large.
This year’s titans:
Senior Director, Strategy & Impact Adventure Travel Trade Association (ATTA) The Adventure Travel Trade Association (ATTA) is widely recognized as a vital leadership voice and partner for the adventure travel industry around the world. ATTA is designed to be a force for the industry and exists to drive thought leadership, industry promotion, and opportunities to network and convene globally to create trade and business health. It currently serves more than 1,000 members in 100 countries worldwide. The constituency is made up of tour operators, tourism boards, specialty agents and accommodations all sharing a vested interest in the sustainable development of adventure tourism.
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Senior Director, Strategy & Impact Adventure Travel Trade Association (ATTA)
Adventure Travel Leading in Grappling with Climate Concerns
We want to go much further than neutral, we want to be carbon positive,” Alex Narracott, the CEO and Founder of Much Better Adventures, said recently. Much Better Adventures has served over 28,000 travellers since it launched in 2012 and is growing more than 100 percent year on year. Similarly, Intrepid Travel, one of the largest adventure travel operators with 350,000 travelers per year, says it aims to be climate positive in 2020. As CEO James Thornton wrote in a company blog in June 2019, “Going climate positive means not just offsetting our carbon emissions but actually improving the environment by removing additional carbon dioxide from the atmosphere.” While in many places of the world it has been shown conservation comes as a consequence of travel and provides a much needed business argument for preserving our Earth’s wild spaces and valuable ecosystems, it’s also true the carbon dioxide emissions associated with travel are significant.
Adventure travelers contribute to the global carbon emissions of tourism, which have been shown to account for approximately 8 percent of global greenhouse gas emissions. Paradoxically, the corner of the travel industry that prides itself on its connection to the conservation of nature and culture now finds itself in the position of contributing to the global warming that is putting many natural and cultural treasures at extreme risk. As awareness for the environmental impacts of travel deepens, from the impact of flying to the impact on local infrastructure from high volumes of visitors (“overtourism”), the adventure travel sector has found a renewed passion for its core tenet of sustainability. A 2019 market study conducted by the Adventure Travel Trade Association (ATTA) in partnership with the International Finance Corporation (IFC)/ World Bank Group estimated the value of outbound adventure and cultural travelers from the U.S. at approximately $96 billion and the outbound value of Australian adventure and cultural travelers at $12 billion.
Adventure Travel Consumer Trends
According to the most recent research, adventure and cultural travelers can be grouped into three primary segments – Cultural Explorers, Experience Samplers, and Adventure Intensives. Examining USA and Australia only, these segments represent a market worth $108 billion. Favored activities include kayaking, backpacking, camping, mountain biking, snorkeling, and motorized sports. Tour operators report that adventure travelers continue to prioritize custom itineraries, remote destinations and trails, and green/sustainable itineraries – “trips intentionally and carefully designed to be environmentally sustainable, for example zero waste, carbon negative or carbon neutral.” Adventure businesses, responsive to trends in consumer preferences and who have set themselves conservation goals from the start, are now making their good deeds more transparent to travelers, and seeing their sustainability stance resonating more powerfully with customers than in the past.
Supporting the expansion of sustainability best practices throughout the industry, the ATTA has found that businesses attending its events care most about educational content focused on sustainability. At the 2019 Adventure Travel World Summit in Gothenburg, Sweden, a session titled Behavior-Smart Thinking led by Dr. Milena Nikolova explored how research from the fields of behavioral science and neuroscience can be applied in the adventure travel realm, supporting destination and traveler decisionmaking in areas that affect sustainability. The session explored the “endless opportunities” for adjusting the design of products, services and policies based on realistic assumptions about human behavior.
Companies Activating Travelers
The emotional benefits of adventure travel have been well documented, and most adventure travel tour operators and agents understand that the idea of taking a trip that might bring a person back home with the benefit of a new outlook on life is a key motivator for customers. For a few vanguard companies, however, the recognition of this desire for learning and transformation has sparked a new kind of trip — the social impact adventure. At The Explorer’s Passage, founder and CEO Jeff Bonaldi has found that his climate and sustainability oriented trips sell faster than his other trips despite the higher price tag and longer duration. For example, his trips delivered in partnership with the 2041 Foundation, a climate action organization, to the Arctic and Antarctica cost just under $18,000 and draw youth as well as business leaders from around the world, some of whom conduct fundraising campaigns to make the trip. Once there, they learn from leaders in climate and environmental science, network, and meet inspiring conservationists such as Jane Goodall and the polar explorer Robert Swan.
Pathway to Action
In an effort to mobilize the enthusiasm and passion of the adventure travel trade community, already leaders in pioneering sustainability practices in their trips, the ATTA is launching two new programs for 2020 aimed at actively reducing the carbon associated with travel. One is Neutral Together, aimed at supporting small businesses in particular. Participants in the program will be able to easily calculate their carbon emissions and offset them at a reduced price through a bulk purchase negotiated with partner South Pole. “We hope to get at least 80 companies participating in the first year,” said Russell Walters, who spearheaded the development of the project at the ATTA. The second program is called Tomorrow’s Air, a collective of travel industry partners and travelers to clean up 8 percent of carbon dioxide in the atmosphere. Participants in the collective will support direct air capture carbon removal with partner Climeworks in addition to global creative communications and educational efforts.
Since the Second International Conference on Climate Change and Tourism in 2007, there has been little coordinated action from the tourism industry to address the role it has played in the problem of climate change. Leading companies are commanding attention and setting an example with progressive policies and proactive work, and travelers are rewarding companies who take their sustainability and climate values to heart and “walk the talk.” For more information, visit adventuretravel.biz.
President and CEO, United States Tour Operators Association (USTOA) The tour operator member companies of the United States Tour Operators Association provide tours, packages and custom arrangements that allow travelers unparalleled access, insider knowledge, peace-of-mind, value and freedom to enjoy destinations and experiences across the entire globe. Each member company has met the travel industry’s highest standards, including participation in the USTOA’s Travelers Assistance Program, which protects consumer payments up to $1 million if the company goes out of business. As a voice for the tour operator industry for more than 40 years, USTOA also provides education and assistance for consumers and travel agents.
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President and CEO United States Tour Operators Association (USTOA)
Sustainability Is Responsibility
With more than one billion people traveling internationally each year, the topic of sustainability has grown beyond a catchphrase to an overwhelming call-to-action across the entire travel industry. There is no denying that travel makes the world a better place. It drives economic progress within local communities and unstable destinations, provides positive cultural exchange and understanding, fosters learning and understanding … the list goes on. This positive impact, however, needs to be nurtured, especially with the number of international travelers rapidly growing each year.
In the USTOA economic impact study by PriceWaterhouseCoopers LLP (PwC) conducted in 2018, tour operator members named “overcrowding” as one of the top three risks that could impact travel over the next three years. We believe the issue is better defined as sustainable tourism, in that tourism has been and will continue to be a positive influence on a destination’s people, culture and environment. Achieving sustainable tourism – addressing the influx of visitors in peak season, promoting undiscovered destinations, encouraging off-season travel, and awareness of issues related to use of plastics, renewables, and energy usage, among other issues – all are part of this complex initiative. Our tour operator members are committed to learning more, doing more, and employing actions that will result in real impact.
That’s why, as an association, we’ve made sustainability the primary focus of USTOA’s strategic five-year plan. On behalf of our tour operator members, USTOA will further define our role and position, while supporting our membership in education and action as it relates to a sustainable future. Earlier this year, sustainable tourism was the subject of USTOA’s 2019 Innovation Lab, a program that engages MBA candidates from Cornell University’s SC Johnson Graduate School of Management in identifying insights most critical for our members’ businesses. The MBA candidates were charged with unmasking the challenges and opportunities specifically related to tourism overcrowding.
The Cornell study revealed the complex effects of unstainable travel while providing insights into how USTOA and the tour operator members can begin to address the issue in order to develop solutions towards a more sustainable future in travel. This critical knowledge will be used as a springboard to implement our plans. As a group of leaders working to create stronger communities and cultural exchange, we invite our valued travel advisor partners to join us in building and fostering a more sustainable future. It truly takes a village. For more information about tours and packaged vacations, visit www.ustoa.com.
Head of Corporate Communications International Air Transport Association (IATA) The International Air Transport Association (IATA) is the trade association of the global airline industry, representing some 290 airlines comprising 82 percent of global air traffic. For over 70 years, IATA has developed global commercial standards upon which the air transport industry is built. Its aim is to assist airlines by simplifying processes and increasing passenger convenience while reducing costs and improving efficiency.
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Head of Corporate Communications International Air Transport Association (IATA)
Airlines Aim to Overcome Challenges
The global airline industry is on track to deliver a record 10th consecutive year of annual profits in 2019, but a combination of factors means the outlook is not quite as bright as it was a year ago. The International Air Transport Association (IATA) forecasts the industry will report an aggregate net profit of $28 billion this year, which is a decline compared to earnings of $30 million in 2018. This translates into a net profit margin of around 3.2% and a profit per departing passenger of just a bit over $6.00. The main culprits behind the lower projections are slowing demand and increasing cost pressures.
For example, global passenger traffic rose 3.8% in August compared to the year-ago period, well down on the roughly 8.5% year-over-year growth seen from 2016 to the first quarter of 2018. The bigger story, however, is on the cargo side of the business, where traffic is actually declining in tandem with negative global trade growth, amid well-known trade tensions and punitive tariffs. Adding to the challenges are rising costs, including for fuel, labor and infrastructure (airports and air traffic management services). Thus, while industry revenues are currently forecast to climb 6.5% this year, operating expenses are expected to rise by 7.4%.
The recent attack on Saudi oil infrastructure, meanwhile, has served as a reminder that the industry is vulnerable to rapid swings in the price of oil. The industry also remains brutally competitive, as illustrated by the demise of four airlines in the month of September. But for air travelers, that also means flying continues to be a tremendous bargain. IATA forecasts that the average return fare (before surcharges and tax) in 2019 will be $317, which is down from $327 in 2018 and 62% lower than in 1998, after adjusting for inflation. Consumers also have more travel choices: the number of unique city pairs served by air in 2019 is forecast to be 22,375, up 118% compared to 1998.
The connectivity provided by aviation is a major contributor to wealth creation. Aviation supports $2.7 trillion (3.6%) of global GDP and 65.5 million jobs when its contribution to global tourism in included. And the importance of aviation to developing countries is reflected in aviation’s direct links to 15 of the UN’s 17 Sustainable Development Goals. As the world becomes wealthier, more people want to take advantage of the opportunities that flying provides. Flying is freedom. It liberates us from the constraints of geography and distance and expands our horizons. In doing so, it empowers us to lead better lives and makes the world a better place. But, as with any human activity, there is an environmental cost. Aviation contributes 2% of global carbon emissions.
This contribution has been well in the public spotlight this year, with the emergence of the flight shaming movement in Europe and the “Green New Deal” in the United States. In addition to flying, tourism has itself come under sustained criticism over its environmental impacts. The message is that people should fly less. But flying is not the enemy. Carbon is. Aviation is serious about environmental sustainability. Emissions from the average journey are half what they were in 1990 and flying today is 17.3% more fuel efficient than a decade ago. Long before this year’s climate protests, the industry was working to mitigate its impact on climate change.
For more than a decade, the industry has had a goal to cap net emissions from 2020. The longer-term target is to cut net carbon emissions 50% by 2050, compared to 2005 levels. Three years ago, member nations of the International Civil Aviation Organization (CAO) — the special UN body devoted to civil air transport — achieved a historic agreement to implement a Carbon Offset and Reduction Scheme for International Aviation (CORSIA). At the 40th ICAO Assembly in September, the commitment was reaffirmed, which will help airlines to achieve carbon-neutral growth from 2020. In addition, ICAO will now start looking at a long-term aspirational goal to cut emissions—so governments and industry will be aligned. A second issue that came to the forefront in 2019 is achieving gender balance.
In September, IATA launched the 25by2025 Campaign to address the industry’s gender imbalance. It is a voluntary program for airlines to commit to increasing female participation at senior levels to at least 25% by 2025. The choice of target helps airlines at any point on the diversity journey participate meaningfully. And the ultimate goal is to bring the industry to a 50-50 representation. The airline industry has a long history of overcoming challenges. That successful track record will stand it in good stead as it addresses its environmental and social responsibilities, while continuing to spread the benefits of the Business of Freedom around the globe. For more information, visit iata.org.
CTIS, President & CEO American Bus Association (ABA) The American Bus Association (ABA) is the trade organization of the intercity bus, tour and travel industry with more than 1,000 motorcoach and tour company members in the United States and Canada. Its members operate charter, tour, regular route, airport express, special operations and contract services. Another 2,800 members are travel and tourism organizations and suppliers of bus products and services who work in partnership with the North American motorcoach industry.
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Peter Pantuso, CTIS
President & CEO American Bus Association
Motorcoach Travel Appeals to Many
The motorcoach group tour industry is alive and vibrant! In 2018, there were more than 236 million group tour visitors touring the country. That equates to nearly 7 million motorcoach trips and 71 million room nights booked. The reason for this healthy industry is traveling by motorcoach is appealing to multiple generations. Baby Boomers. Generation X. Millennials. Motorcoach travel ticks off many boxes for their travel needs whether it is affordable travel, ease of travel or knowing you are traveling on the greenest form of transportation. There is something appealing about motorcoaches for everyone.
The most significant trend right now is travelers are all about the experience. You may say “of course,” but people want a very personal experience. Whether traveling solo or in a group, they want to feel like this tour was created for them. It is all about personalization. Other considerations, especially with Millennial travelers, is about the environment. Eco travel/green travel is a big hit with them right now. They want to go somewhere natural and where they don’t leave a footprint or some want to go somewhere and volunteer. They also want their companies to be green. So, ditch the plastic one-use water bottles and offer refilling stations enabling customers to feel they are helping the environment. Another millennial tour trend is bleisure travel. They want to combine work trips and mini-vacations. Generation X, who are now traveling with their families of either small children or teenagers, want attractions and to get from point A to point B in the least amount of time.
Children have limited focus and want to get to the “fun” part of their trip. Good news is that most motorcoaches today are equipped with wi-fi and plug-ins so kids of all ages can be entertained with their gadgets to stream videos or play games. And of utmost importance is convenience. Traveling with the family is stressful enough, they want someone to take the reins and make sure they just need to show up and enjoy. Baby Boomers want to relax and enjoy during the travel. They like the social aspect of traveling and discovering new places. According to AARP, Baby Boomers plan to take an average of four to five leisure trips a year. They are also spending the most money on travel and they actually like to travel with their families – adult children and grandchildren.
They want to create memorable experiences for everyone. And don’t be afraid to offer adventure to boomers. As more people are living healthier lifestyles and are in better shape, these people want to go hiking, kayaking, white-water rafting. Don’t save all the fun stuff for kids! For all travel groups, local experiences are an expectation these days. People want to do what the locals do – when it comes to eating, drinking, off-the-beaten path entertainment and attractions. Many want to avoid the “tourist trap” areas in cities and live like a local. Whether you are vegan, gluten-free, low carb, keto, etc., healthy and organic food options are a must. Gone are the days of pigging out while on vacation. People don’t want to gain 20 pounds in a week anymore on vacation. Today’s travelers know that delicious and nutritious are not exclusive concepts.
Demand for excellent cuisine with a view to better nutrition is driving new tourism trends. The modern tourist wants to know that the food they’re eating is as healthy as it is delicious. The organic food movement is also affecting tourism trends, with more eateries and hotels offering organic options. They also want to know that the food they are eating is locally sourced and fresh. Destinations are changing. While the big cities like New York and Chicago will always be popular spots, more and more people want to experience new places, small towns. They also want to experience places they see on TV. Finally, you need to be plugged in.
Travelers are doing more and more bookings and researching potential vacations online. They want info immediately when requesting costs. This is also leading to last-minute planning. So, they want flexibility and to be able to book trips at the spur of the moment. Google Data shows that travel-related searches for “tonight” or “today” have grown by 150% on mobile devices over the past two years. Generation Z and Millennials want visual search options. Most of their bookings and trip desires are coming from what they see on Instagram. Everything needs to be “Instagram-worthy.” The American Bus Association (ABA) is the trade organization of the intercity bus, tour and travel industry with more than 1,000 motorcoach and tour company members in the United States and Canada. Its members operate charter, tour, regular route, airport express, special operations and contract services. Another 2,800 members are travel and tourism organizations and suppliers of bus products and services who work in partnership with the North American motorcoach industry. For more information, visit www.buses.org.
Executive Director, International Inbound Travel Association (IITA) The International Inbound Travel Association is the trade association of the United States’ inbound travel industry. Its members are the leading U.S.-based inbound operators, which are companies providing B2B travel services to international tour operators and travel buyers around the world. IITA delivers education and training designed to help the industry grow inbound travel, and advocates for its members’ interests with policymakers, government and industry organizations
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Executive Director International Inbound Travel Association (IITA)
Inbound Travel Industry Changing
For the past few years, we’ve been talking about a decline in international inbound travel to the United States, trying to put our finger on just what’s causing it – is it the strong dollar? A coming recession? Month to month, we watch for signs that inbound travel is rebounding. And each month it’s sort of a mixed bag; some markets up, others down. Overall, it’s clear that inbound travel to the United States has been steadily declining. According to the U.S. Travel Association’s latest Travel Trends Index, international travel to the United States declined for the fifth consecutive month in September, and it’s expected to decrease by another 0.6 percent over the next six months compared to the same period last year. Perhaps more important, we’re losing market share in the global travel industry.
A recent study from Oxford Economics reported that the U.S. portion of total global travel fell to 12% in 2018 from 14% in 2015, resulting in a loss to the nation’s economy of $59 billion in traveler spending from 14 million international visitors. U.S. market share is expected to further drop to 11% by 2022. But we can’t point to just one cause for this decline. There are a number of contributing factors, from Brexit causing economic uncertainty in the UK, the U.S.’s largest inbound source market, to the strong U.S. dollar which makes America a costly destination for international travelers. And travel from China, our leading emerging market, has been falling in recent years primarily due to its economic slowdown.
That decline is expected to continue with the back and forth trade war between the U.S. and China coupled with China’s government issuing a travel advisory earlier this year warning Chinese travelers about gun violence and other crime in the U.S. While inbound operators and others in the industry brace against these external volatilities, they know the travel industry is resilient. They understand there are risks when dealing with an industry impacted daily by shifts in the global economy, geopolitical concerns, civil unrest and natural disasters. And while it may be a constant challenge to keep up with the ups and downs of the global travel market, inbound operators remain optimistic about their role in the industry.
The vast majority of overseas travelers continue to book their travel to foreign destinations through travel agents, tour operators and DMCs (destination management companies), and those companies need U.S. based partners to fulfill their customer demands. U.S. suppliers and destinations interested in increasing their share of international visitation should work with inbound operators, particularly when entering new markets, because inbound operators already have established relationships in the markets they serve. Plus, working with inbound operators allows U.S. suppliers to reach multiple markets more efficiently with greater ROI on their marketing investments.
Inbound operators have the expertise and infrastructure to work with international buyers in their languages and customs, handling contracts, currency exchange and other business activities that can be risky for novices dealing with international business. Most leisure visitors to the United States are traveling as FITs (foreign independent travelers), however, a significant number also come in groups. Although international groups are trending toward smaller groups; they generally book inclusive packages as opposed to FITs that might only book a hotel or hotel and attraction. While most groups may be visiting for leisure purposes, groups also come for meetings and conferences. IITA inbound tour companies offer a breadth of experience and expertise in both leisure services and MICE products.
The World Travel and Tourism Council’s latest economic impact research shows travel and tourism’s contribution to world GDP outpaced the global economy for the eighth consecutive year in 2018. So, while there is cause for concern with the U.S. losing market share of the booming global travel business, it’s fair to say that international inbound travel will continue to be a strong driver of economic growth and job creation. The inbound travel industry will continue to change and evolve as economies ebb and flow and new technologies and connectivity demands continue to disrupt distribution, selling, and traditional marketing techniques.
However, relationships and personalized service will continue to be key factors in growing inbound travel, particularly group travel, and DMOs and suppliers can start building those strong and productive one-on-one relationships with international inbound operators. The International Inbound Travel Association (IITA) is focused exclusively on inbound international travel to the U.S. and more specifically inbound/receptive tour operators. Our mission is to grow inbound travel to the USA by providing the best and widest range of product, services and information to the international travel trade. For more information, visit internationalinboundtravelassociation.org.