Summary Report BVI Tourist Board
dda 2008 Market Insight Overview
Overview of the Travel Market in the UK during 2008 Page
Summary Report BVI Tourist Board
What a difference a year makes. At the beginning of 2008, the forecast for the travel market was very positive with an increase in passengers booking long-haul travel and spending more money to get to that sought after destination. In May, tour operators were arguing that their industry was “recession proof”, with consumers unwilling to cut back on their weeks in the sun, even if it made for belt-tightening elsewhere. By mid-summer we had three major tour operators in administration with several airlines, including Zoom, Futura and business carrier SilverJet, all going out of business. More grim news followed when budget carrier Ryanair reported an 85% fall in first-quarter profit, and British Airways and easyjet both announced management cuts. August saw the demise of the XL Group, the UK’s thirdbiggest travelcompany with up to 85,000 customers stranded in destinations across the globe - things were no longer looking quite so sunny. On a more positive note, by mid December and just in time for the busy Christmas season, Monarch Airlines stepped in to help fill the void in Caribbean flights left by XL Airways’ demise with a new year-round service to Grenada and Tobago. We ended 2008 with major economic downturn, however the long term forecast for UK holidaymakers in the UK & Eire was more encouraging for the long haul luxury travel market and, most importantly, the BVI. Research showed that consumers were opting for a single long-haul break rather than the numerous short-haul breaks of previous years. British Airways also confirmed this with reports of its shorthaul numbers decreasing while witnessing growth in the premium holiday industry. Statistics at the end of 2008 showed that long-haul travel had actually increased by 4% Page
Summary Report BVI Tourist Board
and that there had been an Increase in spend on high-end accommodation and localised activities with an average stay increasing to 11 nights. Headlines in the main UK Broadsheets ran the following headline: ‘The prospect recession grips everyone with a feeling of doom and gloom but Brits have a tendency to embrace holidays as a cure to darker moods.’ •The TimesOctober 08
Opportunities for 2009 – Areas For Consideration “ We may be panicking about our mortgage, trading down at restaurants and fighting over our Page
Summary Report BVI Tourist Board
fuel bills but, however tough things get, we still wont give up our annual holiday.’ •Mail on Sunday, January 2009 With Europe still in economic downturn, it is now a buyers’ market when it comes to travel with clients trying to squeeze every ounce of value out of each travel experience.The trade are reporting a better than expected start to 2009 with long-haul travel selling extremely well. It’s likely that consumers are taking the strength of the euro as an opportunity to visit places in non-euro zones destinations they might not have considered or have only dreamed of experiencing before. Plus the competitive air prices that many of the big air carriers are offering such as Virgin Atlantic who has slashed the coast of its business class fares and so started a price war to boost load factors. Upmarket operator Abercrombie & Kent is opening premises within the Harrods department store in London next February. Known as ‘Abercrombie & Kent Private Travel at Harrods’, the team will offer an ‘exclusive and ultra-bespoke’ service for luxury travellers which will include the booking of private villas, resorts and access to private jets and yachts. In addition the new target audience is the over-65s who are the most determined to prioritise holidays in 2009, with 27% of this age group putting holiday spend first and only 15% focused on unsecured debt repayment. Yet again the wedding market is key for us to target in 2009 – with the number travelling abroad to get married is continuing to increase due to cheaper costs of holding a wedding abroad. One in six British weddings are now taking place overseas with research showing the market valued at £333m this year and forecast to reach £427m by 2013.
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