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The Changing Face of Distribution Channels
KTB UK
Where we are…
Market Background UK
ECONOMIC UPDATE
• GDP grew by 2.7% in 2014 and has continued
to grow at 2.6% in 2015 (exceeding earlier
forecasts)
• Growth for 2016 also recently upgraded to
2.8% (versus 2.5% initially estimated)
• Total consumer spending is expected to
continue growing by around 2% per annum
until 2030 (PWC)
TRAVEL INDUSTRY OUTLOOK
• In terms of spend the United Kingdom is the fifth largest
outbound market (UNWTO Tourism Highlights 2014 Edition)
• Holiday bookings have risen by 10.3% in 2015
• Over half (53%) the UK population took at least one holiday
abroad in 2014
• Growth in the number of holidays driven by more affluent
consumers (ABTA)
Market Background UK
Who Do The British People Holiday With ?
ADULT ONLY GROUP OF FRIENDS
PARTNER ONLY
ALONE
IMMEDIATE FAMILY
EXTENDED FAMILY
GROUP OF FRIENDS INCLUDING KIDS
52%
20%
5%
38%
24%
15%
Top 10 Holiday Types
Package holidays remain important
The Changing Face of Distribution Channels
How are people booking their holidays?
Online Consumer Trends
• 86% of overseas travel transactions in the UK are now ‘digitally influenced’ (Deloitte)
• 80% of travel products in the UK are researched or purchased online, the highest figures for any country in the world (Google)
• 96% of UK consumers book their air travel online (Kantar Media Compete)
• 30% of UK travellers booked their most recent hotel stay directly from a hotel brand website, 32% booked from an online travel agency (ABTA)
What does online mean?
Kenya bucks the trend!
Consumer Trends – Online vs High Street
• Kenya bookings buck the online trend
Multi centre safari and beach itineraries are complex
Consumers need to speak to a specialist
The trade are well aware of this – this is why they love selling Kenya!
Target your consumers online… then take people to the booking source
All Main
77%
49%
48%
43%
32%
45%
15%
13%
9%
6%
The internet
Personal experience
Recommendations
Brochures
Travel agencies
28%
24%
24%
19%
19%
3%
3%
1%
Guidebooks
Tour operator
TV Travel programmes
Newspaper/magazines
Travel magazines
Radio
Main influencers for Kenya
Main channels of research for Kenya
Which channels did you use to research your holiday to Kenya?
• When booking a Kenya holiday respondents were significantly more likely to book direct with a tour operator or a travel agent than online
• When booking their Kenya holiday 82% booked through a tour operator or travel agent vs 30% when booking another long haul destination
(Burns & Co KTB Research)
Booking Kenya
• 192 tour operators sell Kenya
• Volume operators – sell 3 / 4 * hotels
• Luxury operators – 5* holidays
• Specialist tour operators who focus on specific niches
Which tour operators?
In general growth in number of holidays driven by affluent consumers
Which tour operators?
• Previously charters and large tour operators committing seats on charters
• To survive tour operators have focussed their efforts more on tailor-made travel
How can we all use online?
Discovery
Purchase
Experience
Advocacy
The buying process
What should we all be doing?
When are UK consumers online?
Post times of a leading travel supplier in 2015
No one likes cold calls or spam
So avoid promotional posts!
Think Mobile!
UK Outlook
Future
CURRENT TRAVEL TRENDS IN THE UK
© Hills Balfour
THE AGE OF PERSONALISATION
INSTAGRAM: THE INFLUENCER BUMP
THE RISE OF UBIQUITOUS BOOKING
EMERGENCE OF BLEISURE
Current & evolving consumer travel marketing trends will help partners to determine the right marketing channels and messaging
Customisation is key, from cycling, culinary or photography tours. Customers, especially millennials, are seeking deeper connections & personal experiences
The new breed of travel sharer is more viral than bloggers & the twitterati: travel & beyond, to family, food, sports, fashion & design
The ability to book is becoming even more ubiquitous, central, flexible & mobile. Long- haul destinations need to identify with this booking trend which demands more captivating content to help convert last minute bookings
The merging of business & leisure has created a new breed of sky warriors whose expectations & behaviours have shifted towards a culture that combines productivity, opportunity & new experiences.
FUTURE TRAVEL TRENDS IN THE UK
© Hills Balfour
“Across the board, people want to take more international trips and Australia, Italy and the US continue to be the destinations topping travellers’ wish lists.” TripAdvisor chief marketing officer
Barbara Messing
AGEING DEMOGRAPHIC
GROWTH IN TECHNOLOGY
SOCIAL MEDIA REWARDS
LAST-MINUTE LIVING
Increase in 60+ retired travellers with disposable incomes (GENERATION S)
Research by World Travel Market & Euromonitor International identifies more than a third of all travel bookings made online will be done via a mobile device by 2018, revolutionising the travel industry from destination education through to booking
Continuation of last-minute living. AOT partners & industry need to be aware of the late-booking trend & to price fluidly to take advantage of peaks & troughs in occupancy
Companies (such as hotel chains) will start to offer reward schemes for people who share images and reviews of their hotels rooms on social media
Asante sana We are here to help you
Where we were…
Where we were
• In 1990 91% of all holidays booked through a travel agent or tour operator
• In 2004 50% of all holidays booked through a travel agent or tour operator
• Consumers needed human contact
• 1999 Expedia was launched