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pandemic-strategies-to-overcome-the-crisis

Tourism and hospitality during COVID-19 pandemic – strategies to

overcome the crisis
It is a very turbulent time, especially for travel- and tourism-based businesses. We have tried to
help you to navigate through the current crisis by collecting information about the economic
environment overview in this industry and best practices, based on tips and tricks other
companies used to get out of the previous crises (9/11 and SARS). We hope that this article will
spark some ideas for your strategy in these difficult times.

The economic environment for tourism-based businesses during COVID-19

economic crisis – April 2020 overview:

The COVID-19 pandemic has a tremendous effect on the global economy. Bloomberg predicts
that Coronavirus could cost the global economy $2.7 trillion. As per their predictions, in the
worst-case scenario, the GDP globally would drop by 3% this year. The most affected industry is
tourism and hospitality. Tourism represents 10 percent of the global GDP, therefore it will have
a huge impact on the global economy. According to the World Travel and Tourism Council, this
pandemic could cut 50 million jobs globally in the travel and tourism industry. According to the
Mobility Market Outlook on COVID-19, the global revenue for the travel and tourism industry
will be lower by 17% from the previous year, an estimated 568.6 billion U.S. dollars for the full
2020 operations.

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2020 forecast – international tourist arrivals, world (%change):

Source: UNWTO
Forecasted change in revenue from the travel and tourism industry due to the coronavirus

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(COVID-19) pandemic worldwide from 2019 to 2020 (in million U.S. dollars):

Source: Statista

Travel restrictions are growing:

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Source: IATA

COVID-19 outbreak impact on the airlines:

UNWTO estimates international tourist arrivals could decline by 20% to 30% in 2020. Airlines
are operating on very few routes, mostly performing repatriation flights on requests of the
governments or cargo flights with medical supplies.

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Source: IATA

Estimated impact of COVID-19 on air transport in 2020 – RPKs and air passenger revenue loss:

Source: IATA

2020 forecast - international tourist arrivals, world (millions):

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Source: UNWTO

Source: Reuters Graphics

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As of March 22, the number of passengers traveling into and out of European airports had
declined by 88%, compared to a year earlier. Ryanair and easyJet grounded most of their fleets
in late March.

COVID-19 outbreak impact on the restaurant industry:

Year-over-year daily change in seated restaurant diners due to the coronavirus pandemic
worldwide from February 24 to April 7, 2020:

Source: Statista

COVID-19 outbreak impact on hotels:

Trip.com Group expects lodging businesses to decline 60-65% for Q1 2020 (January-March
2020) YoY (year-on-year comparison).

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How to survive the crisis – strategies that can help tourism-

and travel- based businesses during COVID-19 economic crisis:

Source: Unsplash

1. Be transparent and keep your customers informed

Make sure the information on your website is easy to find. Prepare FAQ regarding cancellations
and refunds. Make sure you inform your customers about the actions your business takes to
reduce the virus from spreading (health and safety regulations).

2. Be empathetic

Make sure you do not commit a faux-pas by promoting trips and travels in the time of a
pandemic and travel restrictions. Here is a couple of do’s and don’ts from PR and
communication point of view:

Do:

 Communicate changes in your policies and any help you give to the travellers (reduced
fees, reduced itinerary change fees).
 Give messages of hope.
 Support your followers in surviving the lockdown (you can issue tips and tricks on what
to do while at home, you can mention that you feel for them and you are in the same
situation, connect with them!)
 Promote your charity actions, if you undertook any (helping the medical staff, helping
with bringing necessary products to the country, with repatriation, donating money to
other organizations, supporting your employees).
 Undertake the charity activities, if you have not yet, it will help you to create a positive
brand image and positive PR coverage thanks to which you will stay on customer’s
minds post-crisis.
 Promote your destinations in a subtle way, mentioning that it is waiting for the
customers’ post-crisis for example.

Don’t:

 Take part in political conversations in the media.

 Encourage customers to travel, in the time when it is either forbidden or seen as
unsafe.
 Comment on the fears of the customers (even if they seem to be exaggerated).

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  Express your opinion on the safety measures people should adapt (either skip the topic
or link to governmental regulations or official bodies’ recommendations).

3. Promote your gift cards

To keep revenue flowing and stay liquid, gift cards might be a good solution. If you cannot sell
your services due to the restrictions, you could sell your gift cards on a lower than nominal
value (example: selling a gift card for 40 EUR with a nominal value of 50 EUR). It gives the
customers an incentive to purchase your services upfront and can bring you extra cash. Besides,
even in lockdown, people will still be celebrating birthdays and anniversaries. What better time
for a business to offer gift cards?

Incentivizing customers to accept refunds to gift cards in case of cancellation is also a good
idea.

4. Incentivize your customers to follow the governments’ regulations (and gamify their
experience)

Positive communication, full of empathy, is key from the PR perspective in times of crisis. If you
support people in following the regulations, you can get good media coverage. You can also get
quite a lot of potential customers for the future. Gamification with #stayathome approach can
be a good strategy.

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