Once the coronavirus pandemic is over, the international tourism industry may initially find its saving grace in an unexpected place: the younger market segment.
Older, more affluent travellers have traditionally proved lucrative for the sector. But in the post-pandemic world, it will be critical to focus on a younger demographic, panelists said during a recent webinar hosted by SA Tourism (SAT).
SAT is compiling a Tourism Recovery Plan for the sector and used a series of three webinars to engage the industry on possible solutions, scenarios, and a way forward.
“I get the idea that, after the pandemic is over, older, more affluent people will be less likely to travel,” commented Sisa Ntshona, CEO of SAT.
Lee-Anne Bac, a director at the specialist tourism unit of international consulting firm BDO, said this would not be because older people don’t want to travel, but firstly, due to the risk of catching the virus in busy settings such as airports and in aircraft; and secondly, because older people – being a high-risk demographic for the coronavirus – are consequently more at risk of either being under stricter lockdown rules in their own countries, caught under lockdown while travelling, or quarantined upon return to their home country.
Should Bac be correct, the impact will be felt. SA Tourism data from 2018 showed that people older than 55 years accounted for more than 30% of SA’s visitors from North America, 22% of visitors from European countries and 31% of visitors from Australasia (Australia, New Zealand). On the other hand, only 3% of African arrivals and 8% of Asian visitors were above 55-years.
“[A] big chunk of the more affluent, higher spenders fall within these age brackets. They tended to visit places like game lodges. The loss of this higher average spend will have a significant knock-on effect on SA’s tourism industry,” she says.
Cruises were a favourite among this type of older, more affluent tourists. Bac points out, however, that only about 200 000 people visited SA each year on cruises. This is a very small percentage of the 10 million visitors the country got each year before the pandemic struck.
“But once again, these are high spending individuals. So, their numbers are low but their spend is high,” says Bac.
Shaun van Eck, also known as The Tourism Coach, agrees that older people could be more hesitant to travel. He believes a contributing factor could be personal concern as well.
“They have continuously been exposed to the messaging that the majority who die are within their age groups. The 55- to 70-year-old segment of this market could, however, be more resilient,” he says.
The group is critical to the economy, he adds.
“They are a very important part of our markets…The great benefit of this market, apart from money to travel, is that the majority prefer to travel out of season. That is a huge advantage because it boosts our off-season and they spend freely in the destination that they are visiting.”
Fouad Caunhye, regional manager of Emirates in South Africa, agrees that one would probably not see the 65 or 75-year old “empty nesters” travelling for some time.
“You would have to first convince them to go on a cruise ship or take a plane somewhere. That will take time,” he said during the webinar.
“On the other hand, you may have a pent-up demand of 25- to 45-year-olds with disposable income and keenness to travel and the resources to do so.”
Michael Tollman, CEO of tour operator company Cullinan Holdings, would like SA to look at its visa requirements and making e-visas available in order to make it as easy as possible for tourists to come here post Covid-19.
Velma Corcoran, Airbnb’s manager for sub-Saharan Africa, foresees a very uneven recovery for the tourism industry. In her view, people might first start off looking at where they can go within three hours of their homes so that they do not need to take a plane. They will also be very much focused on value for money.
Stephan Ekbergh, CEO of Cape Town-based online travel agency Travelstart, cautions that it will be some time before the local tourism industry sees the numbers it used to.
“The SA industry needs to come up with great ideas to launch new types of tourism businesses,” he suggested.