Top Challenges Facing Travel Industry in 2022

What Are The Top Challenges Facing The Travel Industry in 2022 & Beyond?

In The Digital Marketing Blog by SeanLeave a Comment

The travel industry has been one of the most volatile over the last year and a half, hit hard by the restrictions brought on by the pandemic.  

But with the vaccination programme having made good progress in the UK, travel restrictions being lifted, and more and more countries making it onto the Government’s green list, what does the future of travel look like?

Will we see a return to pre-pandemic levels of travel? Will the recent reports on climate change impact the way people travel in future? Will travelling habits picked up during the pandemic continue into the future? 

In this post, we’ll be exploring what we think are the top challenges facing the travel industry in 2022 and beyond, and looking at some of the ways that those within the travel industry can overcome them. 

We’ll also be looking at some of the companies that are already making changes. 

So here we go, read on! 

Reducing the Impact of the Travel Industry on Climate Change

The pandemic has undoubtedly affected the travel industry (and we’ll come on to that later) but perhaps one of the biggest challenges that it faces comes from climate change.

We spoke to Brandon Myers, Executive Director at DefensiveDriving.org, who told told us:

“Oil consumption and a push towards green business and green energy seem to be the biggest challenge to the travel industry. 

If anything has taken steam away from the pandemic, it’s been global warming, the awareness of it, and its impact on the environment. Both travel companies and individuals travelling on their own accord, will have to compensate for petroleum and oil use in 2022 and beyond as the world becomes more conscious of the repercussions seen from widespread petrol use. 

We can only assume that governments will be taking a more aggressive approach to policy on fuel consumption as the public’s push to go green intensifies. Brands will face a loss of customers and increased ticket prices if they are not able to find alternative and green means for mass scale transportation that appeals to the public. At the same time, our personal trips will lessen if driving becomes less affordable.

It is for these reasons that we view global warming and petrol consumption as the biggest threats facing the travel and transportation industry today”.

Looking at the stats, it’s hard to disagree with Brandon.

According to Sustainable Travel International, “tourism alone is responsible for 8% of the world’s carbon emissions” and with cheap flights readily available, and more and more people travelling around the world, this is only likely to increase.  

They also report that:

  • Air travel emissions increased by 32% in recent years
  • If emissions continue to grow, sea levels could rise by up to 3.6 feet by 2100
  • Severe coral bleaching is happening 5x more frequently than in past decades 
  • Alpine resorts could lose 70% of their snow by the end of the century 

Pretty heavy stuff. 

On top of that, in August, The IPCC released their report on climate change, which also struck some harsh warnings, with the BBC reporting that it meant “A code red for humanity” and The Guardian reporting that “Major climate changes were inevitable and irreversible”. 

BBC IPCC Report on Climate Change

With such strong messaging coming from the IPCC and shocking headlines across the media, is now finally the time that more people think about their carbon footprint? 

We certainly think so. 

Not only do we believe that more and more individuals will become more conscious of how their actions affect the world, but businesses will be forced to as well. 

We spoke to Mark Fenelon, CEO of Clink Hostels who also believes that travel companies will have to be wary of more conscious consumers. He said:  

“I believe that one of the massive changes coming very quickly and especially from our target guests, 18-30’s, is that people want companies that are actually responsible; that actually stand for something; that actually become part of the change to improve the communities that we live in; to give back more. 

In an extensive survey that we conducted in September last year, over 70% of respondents stated that they would not support companies who did not align with their political-social-environmental needs. 

Companies need to be part of ensuring meaningful change, they need to link together. We are now well beyond the era where 18-30 year old guests would be satisfied with corporate green washing – they now want real action from companies!”

It’s hard not to agree with him. 

In today’s society, we’re dealing with a much more conscious consumer and more and more, people want to make sure that the companies they buy from are the right ones; those that are making a positive social, environmental or economic impact on the world. 

You only have to look at sites like Ethical Consumer and their boycott list! (note that Air France feature on their list)

With the impact travel has on the world, we believe that for travel companies this is going to be even more important. So, what does that mean for them and their customers? 

Well, here are just some of the ways that we predict consumer behaviour might change over the next few years when it comes to travel and climate change: 

  • Customers will want to choose individual airlines carefully and will be looking toward those that make a positive impact on the world
  • People will try to book more direct flights to avoid unnecessary extra travel 
  • Businesses may try and cut down on their staff member’s travel for business meetings and try to use video conferencing instead of face-to-face meetings
  • Customers might want to look at ways in which they can offset their carbon footprint when it comes to travel, and may want to choose companies that help them to do this

With this in mind, what can those working in the travel industry do to help reduce their impact on climate change? 

Let’s take a look. 

Lowering Carbon Emissions

One of the key things that those working in the travel industry can do, is to try and reduce their own carbon emissions. 

Many well-known brands are already doing this and for those that want to compete in the future, they’ll need to do the same. For example:

  • Hilton Hotels have installed energy efficient lighting in all their buildings and will also be sourcing from local suppliers 
  • Royal Carribean’s ships have purification systems to remove 98% of sulfur dioxide emissions from their exhausts 
  • British Airways are committed to cutting CO2 emissions in half by 2050 and are building a plant that produces fuel from household waste
  • Virgin Atlantic are partnering with manufacturers to create a jet fuel that will create 50% less carbon than fossil fuels 

Ryanair have also introduced their carbon calculator to their website which allows customers to understand the carbon emissions of each flight, and allow them to offset their emissions as they make a booking. 

RyanAir Carbon Offset Calculator

It’s clear that as a travel brand, if you want to succeed in 2022 and beyond, you’ll need to show that you’re doing something to help. 

Which brings us nicely onto our next point….

Educating & Creating Awareness for Travellers 

As well as working on reducing their carbon emissions and becoming more sustainable themselves, travel operators will also need to educate their customers on what they can do to help when travelling.  

There are many ways in which travel brands could do this.

It could be through additional copy on their website or pages dedicated to travelling sustainably, by creating images or posts on their social media channels, or even creating pop-up notifications or messaging when taking customers through the booking process. 

By educating their audience and customers on how their activities contribute toward climate change, and what they themselves can do to help, travel businesses can ensure that they are both doing their bit, and helping their customers to do better at the same time. 

If consumers are actively going to be looking for businesses that show they are doing their part, education and talking about the impact of travel on global warming is only going to help them going forward. 

A great example of this, comes from sustainabletravel.org below:

Sustainable Travel - Responsible Travel Info

Here you have tips on the small things that you can do whilst travelling to create positive change. 

Although not a tour operator or travel agent, this is exactly the type of information that those types of businesses could use across their websites or social media platforms to educate their customers.

Zero Emission Flights & Electric Aviation 

One of the biggest issues that airlines face, is the amount of Carbon Dioxide that planes pump into the atmosphere. 

In 2019, the UK Government signed a commitment to make the UK a “net zero” greenhouse gas emitter by 2050 and for this to happen, there are going to have to be some changes. With air travel only likely to increase, businesses will need to find ways of offsetting the greenhouse gases that are produced, or find alternative ways of flying. 

Luckily, there are some businesses that have already made a start to the latter. 

Take Airbus for example, who are on a mission to get to zero-emission flights by 2035. 

In September 2020, they announced their three concepts for the world’s first zero-emission commercial aircraft, with their CEO, Guillaume Faury stating: 

“This is a historic moment for the commercial aviation sector as a whole and we intend to play a leading role in the most important transition this industry has ever seen. The concepts we unveil today offer the world a glimpse of our ambition to drive a bold vision for the future of zero-emission flight. I strongly believe that the use of hydrogen – both in synthetic fuels and as a primary power source for commercial aircraft – has the potential to significantly reduce aviation’s climate impact.”  

On a smaller scale, Energy Monitor reports that Canadian seaplane airline Harbour Air have also been conducting test flights of zero-emission, all-electric commercial airplanes since 2019 and hopes to be able to offer it’s first electrical commercial flights to customers in 2022. 

We spoke to Debbie Iannaci, Senior Director at Global Business Travel Association who agreed and told us: 

“For years, sustainability has been on the travel industry’s radar. Progress has been made but now, and with a lot to do with the pandemic, we are seeing it take on more importance and urgency than ever. 

There are pressures on airlines to solve the zero net commission challenge.Travel will need to look at the end-to-end travel journey – all touch points not just air travel. And ideally, sustainable travel is achieved while also retaining or improving the business traveller experience, not creating more pain points”. 

For airlines to try and implement electrical commercial and zero-emmision flights is obviously a huge task and not something that will happen overnight, but with many like Airbus already on the journey, we believe that others in the aviation industry will have to to follow suit or face the consequences of being left behind. 

So, we’ve talked about climate change and some of the ways in which the travel industry can solve the problems it presents, but what is the other major challenge that faces the travel industry in 2022 and beyond? 

The Pandemic: Flexible Travel & Consumer Confidence 

Ahh, the P word. We just couldn’t avoid it could we…

Undoubtedly one of the most obvious challenges facing the travel industry in 2022 is the pandemic, and the uncertainty that it brings to travel. 

With red, green and amber lists used up until recently and the new red and green lists being used by the UK Government, there is always a risk when it comes to booking a holiday. 

For example, say you booked well in advance of travelling to a country on the green list, but then by the time it comes to travelling, it’s put on the red list. What happens then? Will you get your money back? Will you be able to swap your flights for an alternative destination?

That’s the risk that people take if they book a holiday in advance, and the biggest impact that this has had on the travel industry is that customers are more likely to make last-minute bookings, with less of a risk of things changing. 

Last Minute Bookings 

We spoke to Michael Rozenblit, Founder of The World Was Here First who said: 

“One of the biggest challenges facing the travel industry in the next year or two is going to be the change in consumers’ travel booking windows. 

While previously, many travel businesses might have worked on the basis that people book on average 6 or 12 months out, the risk of border closures and restrictions will mean that operators will need to shift marketing spend and budget to capture people booking within a much smaller timeframe. 

We have seen this with our affiliate business where a significant amount of hotel and tour bookings are coming in within a month of travel rather than 3 or 6 months out as was occurring prior to Covid”.

Onur Kiyak, CEO at gourmetmktg.com echoed this, saying 

“For Hotels, it has been a rollercoaster, with future (3-5 months ahead) bookings almost vanishing”. 

In our opinion, more and more people will continue to book their holidays last minute and there are issues that come with this including: 

  • Airbnb owners having little time to prepare properties
  • Less time to rectify admin or booking errors

As well as those working in the travel industry preparing for last-minute bookings, we’re also likely to see a continuation of last-minute cancellations too.

Last-Minute Cancellations

In the Guardian back in May 2021, it was claimed that many holidaymakers were booking stays at two or more hotels at a time, with a view to cancelling all of them, bar one at the last-minute. 

It’s not exactly an ideal scenario for hoteliers, with rooms being booked that people never had any intention of staying in, and customers taking advantage of their cancellation policies. 

But unfortunately, whilst we’re still dealing with the pandemic, there are always going to be cancellations. 

Again, when we spoke to Onur Kiyak, CEO at gourmetmktg.com, he said that quite simply, 

“Guests prefer to book last minute, and the cancellation rate is very high”

Last minute cancellations are a nightmare for those working in the travel industry, especially smaller and independent businesses, and this is one of the biggest challenges that they’ll face over the next few years. 

In most cases, they won’t be able to fill the spaces left in Airbnb’s, rooms in their hotels or empty seats on flights, as they simply don’t have the time to replace lost bookings. On top of that, they’ll also likely have to provide some sort of refund to those that cancelled. 

Financially, it can be crippling, but there is some hope. 

Travel agents and holiday operators might want to consider offering last-minute discounted flights or rooms/apartments when a customer must cancel, helping them to minimise their losses. 

This could be in the form of: 

  • Emails to those who subscribe to get last-minute, cheap offers
  • Desktop notifications letting customers know about any last-minute cancellations 
  • Social media posts to your followers, letting them know of the last-minute deals that you have 

Imagine this scenario: You choose somewhere to go to on holiday and find your dream apartment, only to find out that it’s booked up for the dates that you want. Now, what if you could get a notification or email letting you know if the person who’d booked it at that time had to cancel and that you could still get it at a discounted, last-minute rate? 

We certainly believe it’s something to think about as we know that with more people will be taking last minute holidays, and it might help to fill the gap left by cancellations. 

Win win. 

We also spoke to Marcelo Novais, General Manager, North America at Ker & Downey® Africa who said: 

“For travel specialists and operators, the main challenge will be finding partners that offer clients flexible booking terms and conditions, including penalty-free postponements and cancellations. 

Many travellers were heavily hit by pandemic cancelation fees, so providing flexibility for guests will be crucial for rebuilding trust”. 

Flexible Bookings  

In short, moving forward, many in the travel industry are going to need to show more flexibility when it comes to managing their customers bookings.

But how? Here are some of our thoughts: 

  • Make sure that they’re able to offer their customers last-minute deals 
  • Update cancellation policies to allow customers to receive refunds or vouchers in the event of trips being cancelled due to restrictions changing 
  • Reassure their customers that they’’ll be able to change their booking if they test positive for Covid before they travel 
  • Consider wavering any customer fees for changing dates and/or destinations 

British Airways are great example of a company that is doing this well and they even have a page dedicated to Flexible Booking on their website:

British Airways Flexible Booking

Here, they provide multiple different options for what to do if you need to amend or cancel your booking. They allow their customers to change the dates and destinations of their flights with no additional charges, as well as offering vouchers if their customers need to cancel flights completely. 

If flights are cancelled, they also offer a refund. 

It’s this type of customer service that will help them to stand out from the crowd during the pandemic and we believe that those working within the travel industry will need to follow suit if they want to compete into 2022 and beyond.

After all, in the future, consumers are likely to remember the companies that treated them well during the pandemic. 

Most travel and holiday companies will offer some sort of flexibility but many aren’t as good as BA and some still don’t offer full refunds even if your destination is moved to the red list. 

As such, if you’re planning a holiday, you can find a list of the top holiday companies with the best flexible covid policies from Which here

Conclusion

So, there you have it, climate change and the pandemic are two of the main challenges that we believe the travel industry will be facing into 2022 and beyond. 

Although things are currently looking optimistic in terms of the pandemic, just like in Game of Thrones, winter is coming, and with that there is more uncertainty. 

Will we see a rise in infections and hospitalisations with Covid and the Flu circulating at the same time? Will we have another lockdown? If so, how will this affect travel again?

It remains to be seen. 

Although we believe that these are the most important challenges that the travel industry faces in 2022 and beyond, there are more. 

We can’t go into them all, but an increase in staycations and inflated prices, a lack of information on what’s required to travel to each destination and the issues surrounding vaccine passports have and will continue to impact the travel industry. 

We’d love to hear your thoughts on these and any others that you think they might face. If you have any thoughts, please do leave them in the comments below. 

If you’re a business working in the travel industry and you’d like to talk to us about your digital marketing strategy, please don’t hesitate to get in touch.

You can give us a call on 01273 733433 or leave us a message via the form below. We’re passionate about travel and would love to help!

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