TAILOR MADE REPRESENTATION

I have been out in Europe on the Australia on Tour roadshow and the general consensus is very positive.  Flight prices remain high, but staff and customers are just beginning to accept this as the new normal (because it is!).

I spent a lot of time with Tourism Australia and Tourism New Zealand this month at Unite Pacific trade show and at ITB in Berlin. Both reported strong demand but still reduced numbers compared to pre-Covid figures. Seat capacity and high-priced airfares is still the issue and while this will drop a bit in 2025, I can’t see us getting back to 2018/19 rates. The same can be said for land products, rates will drop a bit in 2025 but not by much. Consequently, the agents are reporting far higher revenue per customer, which is nice in the short term, but we want more people going to NZ/Australia to increase returns and word of mouth.

This month has been all about travel shows and brochure launches. Both have been very popular which is a great indicator of demand. Good news all around.

Most agents report higher sales in Jan/Feb 2024 than the same time in 2023 which was already a very big year. A key difference is that in many cases the staff at agents in 2023 were new with one agent reporting 40% of staff being there under a year at that time. We are now a year on, so these staff are now more experienced and making better sales with less mistakes. There is also a very noticeable drop in age for the present new recruits, this shows that young people are travelling again, then they are returning and looking for work in travel.

All signs are good for a big 2024 for travel as staff numbers continue to increase at travel agencies. Enquiries and bookings are so strong that many agents are not doing any marketing as they are already working at a maximum capacity.

A recent report by TTG (Travel Trade Gazette) and PWC surveyed 2,000 people showed a continued strong demand for holidays with some people cutting back in other areas to ‘protect’ their holiday plans.  Only 3% were planning on travelling to Australia/NZ but 70% planned to spend the same or more than they did in 2023 with only 15% planning on cutting their holiday budget.  This extra spend was particularly in the higher income and older groups with customers aiming for ‘longer more premium’ locations which has to be good for Australia/NZ.

All the printed and virtual brochures are coming out now and agents are busy with enquiries and bookings.  The lack of flight capacity remains an issue and is keeping the flight prices high.  We are waiting for the China carriers to re-enter the market as they will come back with low airfares and help bring down the rates being charged by the premium carriers.

We are now coming into the peak booking season so there will be much more enquiries.  Lots of staff training which will be followed by staff incentives to kick off a fantastic 2024.

I have seen various agents and tourism bodies this month and they are very much in agreement about the present market situation.  There was a rush of demand post-Covid with customers not caring much about cost.  Many people did well out of Covid, earning full pay or close to it and not being able to spend anything so demand was high to travel, and budgets were good.  This was especially the case in Scandinavia where government social support has always been high.  This has now finished, and customers are being a bit slower to book due to high rates for flights plus ground product.  The only positive is that this is true of everywhere and everything, so customers are also beginning to accept that everything costs more than it did a few years ago.

I can’t say I am proud of my carbon footprint this month (or last month), but I have been to see a lot of agents with trips to Finland, Norway, Sweden, Denmark, Holland (twice), Belgium and Germany this month, plus Portugal for WYSTC.

NZ and Australia remain expensive due to lack of seats on planes but everywhere is the same!  Customers are just getting used to things being more expensive as staff shortages continue to create problems with distribution and lower service levels.

The Pound is having a tough time which is not great for me, but it is good for travel to NZ/Australia as the AUD is now over $2 to the £1 and NZD is $2.17 which makes the destinations cheaper.

On my way to NZ!!

The economic climate in the UK and EU is still a mess due to Covid hangover, mass migration and Brexit.  This leaves us with a lack of staff in many countries, mainly in the lower paid sector.  The UK is the hardest hit with high inflation, high interest rates and ever-increasing energy costs.  Things seem to be settling down a bit this month and the news has swapped over to the heatwave in Europe. https://www.bbc.co.uk/news/live/world-66207430  This is causing people to cancel holidays in Europe and even USA so we may see a few extra bookings coming in for NZ.