Catégorie : Customer segments

Catégories
Customer segments

Family travel and Generation X parents

In the last few decades, family realities have changed dramatically. While amenities popular with children (like a hotel pool) are still very important when planning a family vacation, the demand for family travel has been affected by the fact that parents from Generation X now head young families. Having had their children much later in life, this new generation of parents has different values and concerns than their predecessors.

Families look for interesting activities and appropriate services

According to recent findings from Shell Hospitality, owner and operator of a dozen or so resort hotels in the United States and Canada, the top three decision factors in planning a family vacation are the following:
According to recent findings from Shell Hospitality, owner and operator of a dozen or so resort hotels in the United States and Canada, the top three decision factors in planning a family vacation are the following:

  • Location: the destination must offer fast, easy access to a variety of family and recreational activities (amusement parks, visitor attractions, beaches, ski hills, etc.) or be located near the homes of friends and family.
  • Room size: rooms must be spacious enough to allow multiple family members to relax. Families increasingly appreciate amenities like kitchenettes, video games and internet access.
  • Hotel services: naturally, a pool is still the most popular attraction. However, game rooms and fitness facilities are also desirable features. Finally, when the group involves more than one family, teens want their own room; if grandparents are also part of the group, it is vital to be able to reserve neighbouring rooms.

A Travel Industry Association of America (TIA) study confirms that programs for children are very popular with families. Special children’s menus (41%) and hotel discounts for families (30%) are the most popular features, while the availability of toys and video games (22%), supervised activities (13%) and babysitting services (6%) are also well liked by families.

Although an average 60% of families take advantage of these types of services when they travel, Generation X parents are more likely to do so, with 71% of those aged 35 44 using children’s programs. This is the highest proportion among all individuals who travel with children.

Who are Generation X parents?

Generation X covers individuals born from 1965 to 1980. Even though the oldest of these are already in their 40s, many are parents of young children.

In Canada, it is estimated only 17% of Gen Xers have had a first child by the age of 25, while this percentage jumps to 29% among Baby Boomers. In 2002, four out of 10 children (40%) were born to parents aged 30 to 39, compared to 34% in 1991 and 24% in 1981.

Looking for work life balance in a race against time

For Generation X, happiness depends primarily on successfully balancing one?s personal and professional responsibilities. To this end, 80% of parents in this generation would like to spend more time with their families even though, on average, they already spend more time with their children than their parents did.

Shorter, more frequent trips

According to a Spring 2005 survey conducted by the US website thefamilytravelfiles.com, family travel is following the trend towards shorter, more frequent trips. In fact, 35% of those surveyed reported having taken two family vacations during the year, while another 35% reported having taken three or more trips. This frequency had an effect on the duration of family vacations: 75% of them were for a week or less, with 35% of all trips lasting only 2 to 5 days.

Torn between their personal needs, their desire for time with their spouse and the importance attached to family time, Generation X parents are creating a new demand for family travel. Although both leisure and business travel afford opportunities for personal relaxation and rejuvenating time for couples, they are also becoming ideal occasions to spend quality time with the children.

Family responsive vs. family friendly

Family travel was long defined as travel for children, while today it is defined as travel with children. The nuance is important for companies who must become responsive to the needs of both parents and children; traditional family friendly outfits, like theme parks and zoos, must now think about the type of experience available to parents so that visits are enjoyable for every member of the family.

At the same time, to respond to these various needs, some tourism based companies with primarily adult clientele are starting to experiment with new services to show that their facilities can offer everyone, children included, a fun vacation. Last December, Air Transat launched its Kids Club (ages 2 to 11), which provides a number of services and privileges (priority boarding, games, special meals, etc.) to make a family vacation more fun and enjoyable for everyone. Currently, children represent 6% of all Transat Holidays customers.

Resort complexes in southern destinations were among the first to develop mini club services to offer parents a family vacation experience that cleverly combines time with the children with time alone. Club Med remains a leader in this type of approach, breaking down its various children?s programs according to age: Baby Club (4 to 23 months), Petit Club (2 to 3 years), Mini Club (4 to 10 years) and the new Junior Club for teens (11 to 17 years).

Major cruise ship companies quickly adopted this model to attract families. By offering adapted facilities (family staterooms) and appropriate services (organized activities for kids, a water park, arcade, etc.), cruise ships are positioning themselves as the holiday solution that promises something for everyone. And the approach seems to be working: 525,000 of the 3.3 million passengers travelling with Carnival Cruise in 2005 were children.

In Quebec, family friendly initiatives have sprung up recently at spas, country inns and business hotels. These include activities aimed directly at children, babysitting services, supervised game areas for both younger children and older children and family suites furnished specifically for the comfort of children and parents.

In conclusion, in the era of Generation X parents, family travel is no longer defined solely by the preferences of children; parents want to have fun too!

Sources:

– « Cruises: All in the Family, Oceans of Fun for Families, » Family Travel Files Ezine [www.thefamilytravelfiles.com], September 2005.
– Désiront, André. « Partir avec les enfants, » La Presse, February 13, 2006.
– « Kids Want Goodies, Teens Want Adventure: Resort, Airlines and Cruises Cater to All Ages, » Calgary Herald, February 25, 2006.
– « Press Release Family Vacation Survey 2005, » Family Travel Files Ezine [www.thefamilytravelfiles.com], June 2005.
– « Shell Hospitality Reports Trends in Holiday and Family Travel, » Travel 2006 [www.travel2006.org], December 9, 2005.
– Vailles, Francis. « Société : Famille X (2), » La Presse, May 8, 2004.

Catégories
Customer segments Trends

Tourism through the crystal ball

From time to time, tourism experts are asked to predict the major developments that will affect the industry in the near future. The following are some of the more significant trends they foresaw in world tourism, some of which are formative and practically inevitable while others are more in the realm of « possibility ».

Products and destinations

Online travel agencies will introduce service fees similar to those charged by conventional agencies.

  • The gap in terms of the services offered by regular and low-cost carriers will widen.
  • In addition to becoming more affordable, cruises will gradually turn into floating entertainment centres.
  • There will be a proliferation of low-cost, short-stay/long-haul travel, i.e., a weekend in Europe or a week in Australia.
  • Beach vacation destinations will be segmented according to specific consumer wishes: relaxation (no cell-phones), families only, celebrations or recreational activities.
  • New destinations will appear on the world tourism stage, with Qatar replacing the Canary Islands, Ljubljana, Slovenia ousting Prague, Slovakia taking over from New Zealand and Brazil set to become the next mass tourism destination.
  • Initially confined to adventure tourists, China’s Silk Road will become one of the world’s most popular destinations.

Clientele

  • A new kind of « hybrid consumer » will emerge who – for example – will combine a low-cost flight and a gourmet dinner, a stay at a 5-star hotel and a fast-food meal, all in the same trip.
  • As internet-users become more comfortable making online reservations, do-it-yourself travel and dynamic packaging will grow in popularity.
  • Low-cost carriers will make increasingly aggressive efforts to reach business travellers.
  • There will be a growing number of solo travellers making spontaneous travel decisions.
  • The industry will have to adapt to the reality of an over-50 set that still wants to act young.
  • Customers will want to go on a virtual tour of their vacation destination before they leave home.
  • Better-informed travellers will be more demanding with respect to product quality and services.
  • Travellers will become inured to crisis situations and will gradually become less affected by them.
  • Personalization features will enable travellers to design packages that reflect their individual preferences.

Sources :
– Thomson. «The Thomson Future Holiday Forum», [http://www.hospitalitynet.org/file/
152001280.pdf], 2004.
– Jarrett, Ian. «Travel Weekly’s hottest news predictions for 2004», février 2004.
– IPK International. «World Travel Trends 2003-2004», 10 novembre 2003.

Catégories
Customer segments Trends

Conventions and business meetings: trends to watch

A panel consisting of 26 British and Australian experts comments on the major trends shaping the business and convention tourism industry over the next few years. The rapidly changing economic, technological and sociopolitical contexts exert varying degrees of influence on the industry's leaders. With ever increasing competition and an increasingly diversified product, the convention market remains one to watch.

The convention and business meeting industry is cyclical, and mirrors fluctuations in the economy. After a marked slowdown during the post-September 11 years, the Travel Industry Association expects the growth noted over the past few decades to gradually resume, reaching approximately 3.6% in the United States in 2005.

Be that as it may, players in the convention sector need to be aware of the major trends that will exert a strong influence in the years to come. Two university researchers did a qualitative study to see if there was any consensus concerning important trends among a sample group of over 250 British and Australian experts from tourism associations, convention bureaus, specialized convention planning services, sectorial associations, universities and convention centres. Three categories emerged from the study results: the business environment, technology and the social and political context.

Competition: the No. 1 business issue

There is growing consensus concerning the significance of global competition. This factor can only intensify, given the rapid proliferation of new convention centres, the modernization of services, the competitive prices offered by emerging destinations and higher customer expectations. For instance, meeting and convention space in the United Kingdom is no longer centred solely in large cities. It is also being integrated into country hotels, educational institutions and other kinds of alternate accommodation, such as castles or even historic sites. Even cinema complexes are trying to attract corporate events with high-tech audiovisual facilities and turnkey service.

The panel also identified currency fluctuations as a major issue. In the context of global competition, this can have a significant impact on destinations with a strong currency. In that respect, the strong appreciation the Canadian dollar over the past few months could negatively affect Quebec's desirability for international travellers.

In fact, convention organizations will have to adapt to the changing nature of the events themselves, which will be shorter, with fewer delegates. These kinds of changes will require marketing initiatives that focus on developing long-term relationships with clientele, to ensure a certain stability and encourage repeat business.

In 2003, Meeting Professionals International identified the major technological factors influencing convention planning. These are: shorter reservation times – primarily attributed to more effective communication – and online reservation services, which greatly assist more rapid event organization. These factors inevitably make the long-term scheduling of events more problematic.

Technological advances

Although equipping convention centres with the latest technology makes them more efficient, it can also create problems. Often, the centre lacks the necessary support; when technological difficulties arise during an event, its efficiency is compromised. This, and the fact that convention centre employees need to be trained to use of the new equipment, are some of the reasons for a certain resistance to implementing cutting edge technology.

On the other hand, many customers are demanding the latest technological innovations. Unfortunately, the costs associated with installation and frequent updates are often prohibitive for smaller convention centres. In terms of technology, this will give the larger centres an increasingly significant competitive advantage.

For the past few years, much has been said about the effect of videoconferencing on business travel. Some experts have hailed it as a substitute for the trips themselves, but it seems this view is not completely accurate. These days, the panel of experts by and large agrees that Web solutions will never completely replace the traditional face-to-face meetings. Despite the technological breakthrough, human contact remains essential for effective communication. This view restores business meetings and conventions to their rightful place as the ideal setting – far better than an online videoconference – in which to make business contacts.

Social and political context

The steady growth in international tourism will increase demand for convention tourism. This is due to the simple fact that the more people travel – whether for business or pleasure – the more acceptable the idea of attending a convention in another country becomes.

Work habits have changed over the past few years, with more and more people working from home. The sense of professional isolation this can engender leads to the growing necessity of bringing together geographically dispersed colleagues in the context of business meetings.

Sociodemographic changes could also create new business opportunities. As the working population ages, a large number of former employees remain active in their field by joining various retiree associations and by attending conventions and business meetings. Also, as work-life balance becomes a more pressing issue, an increasing number of delegates will choose to add a pleasure component to their business trip by bringing along the family. Destinations that are seen as « family-friendly » will benefit from this trend.

Finally, a destination's political stability remains a guarantee of visitor safety, in addition to conferring a significant competitive advantage. In that respect, Quebec must continue to capitalize on its completely safe environment, even in the downtown core of major urban areas. As for the future outlook, it remains to be seen what other factors will influence convention planners – choice of destination.

Sources:
– Biarritz, Anne. «Organiser un événement corporatif dans une salle de cinéma», Le Planificateur, mai 2005.
– Meeting Professionals International. «Welcome to Futurewatch 2003», MPI [www.mpiweb.org], 2003.
– Travel Industry Association. «Travel Industry Optimistic For 2005», Hospitality Net [www.hospitalitynet.org], 2 novembre 2004.
– Weber, Karin et Adele Ladkin. «Trends Affecting the Convention Industry in the 21st Century», Journal of Convention & Event Tourism, Vol. 6, No 4, 2004.

Catégories
Customer segments Products and activities

The cultural travel market

American cultural travellers represent an especially lucrative market: nearly one-third spend over US$1,000 when they travel. By way of comparison, only 11% of all U.S. travellers spend this much. This news comes from Renee Mitchell, Research Director, Smithsonian Magazine, speaking at the most recent TIA Marketing Outlook Forum. Her presentation discussed the demand for cultural travel.

Characteristics of cultural travellers

Over 44 million American cultural tourists stay in commercial lodgings when they travel and generate an estimated US$29 billion per year in travel spending. Around 76% of them are leisure travellers, while 24% are business travellers. Some specific traits of cultural travellers are listed below:

  • Average age is 46 years old
  • Average household income is US$75,800
  • 62% are married
  • 87% have a college diploma or higher
  • 31% have children living at home
  • 37% travel during the summer

Interest in culture = interest in travel

According to Mitchell, Americans interested in history and culture, like the readers of Smithsonian Magazine, are especially interested in travel with an historic/cultural emphasis. A survey of the magazine’s readers showed:

  • 93% visit historic sites
  • 84% learn all they can about a destination before going there
  • 76% consider culture and heritage when selecting a destination
  • 71% explore towns off the beaten path

According to a TIA/Smithsonian survey, American cultural travellers can be characterized by the four « L’s »:

  • Learning – 82 million say, « Trips where I learn something new are more memorable. »
  • Leisure Activities – 67 million say, « My hobbies and interests influence my destination selection. »
  • Locals – 63 million say, « While on vacation, I like to find places that are popular with locals. »
  • Love it! – 34 million say, « Vacation/leisure trips including cultural activities are more important to me. »

Not the same as other travellers

Comparing cultural travellers with other travellers reveals some interesting differences. For example, cultural travellers spend a lot more than other travellers and tend to stay at destinations for much longer (see table). In addition, they are very active tourists: nearly half of those who stay in hotels participate in at least four activities. They are fond of shopping, nightlife and urban sightseeing.

Table 1: Comparison of American travel behaviours

All travellers Hotel travellers Cultural hotel travellers

  • Spent US$1,000+ on trip 11% 20% 30%
  • Primary travel by air 19% 30% 32%
  • Trip = 3+ nights 41% 52% 66%
  • Trip = 7+ nights 13% 23%
  • 3+ people in party 19% 26%
  • 2+ activities on trip 38% 45% 88%
  • 4+ activities on trip 7% 45%
  • Shopping 29% 29% 47%
  • Nightlife/dancing 7% 10% 16%
  • City/urban sightseeing 10% 15% 30%

Source: Roper Reports 2004

Promising outlook for 2005

In 2005, the demand for historic/cultural travel products will be high. According to a Roper survey, among Americans planning to travel in 2005:

  • 24% will visit an historical site
  • 17% will take a fishing trip
  • 16% will visit a casino
  • 16% will go hiking or camping
  • 10% will purchase a package tour

  • 9% will visit a health spa

Renee Mitchell emphasized that the travel behaviour of cultural hotel travellers makes them very profitable targets. She also stressed that hotels are ideal cultural partners for promoting special products, packages, events, etc.

However, one must remain realistic with regard to the overall tourism potential of US travellers. It is increasingly difficult to get them to cross any borders. For Americans, the most important factor in selecting a destination is safety (75%), which has now surpassed affordability (62%). Obviously, statistics such as these tend to favour domestic travel. Nonetheless, Canada does offer proximity and a reputation for safety, which certainly gives it an edge over other destinations.

Source:
– The Roper Center – TIA and Smithsonian Magazine. « The Historic/Cultural Traveler » [www.tia.org], 2003.

Catégories
Customer segments Transportation Trends

Group Tourism takes on a youthful look

When we speak of package tours by coach, it usually means the traditional « tour and travel ». We think at once of customers who are pensioners or persons taking early retirement. Today, we notice a wave of rejuvenation: the average age of the passengers is closer to 55 years than the age of the pensioner (65 years). Thanks to the increase in thematic tours and new destinations, the chartered tours in motorcoach get a second breath and interest a more diversified customer basis.

An important sector

The study on the Québec chartered bus industry, realized in 2001 by the Chair in Tourism of the UQAM, showed the importance of this sector for the tourism and the economy of Québec. We found that some 14% of all the tourist revenue in Québec comes from chartered transport.

Let us clarify that chartered transport defines itself as an occasional service reserved for the exclusive transport of groups of persons, as opposed to the tourist transport which offers a service of tourist visits to the general public. City visits belong to the tourist transport, while the tourist tours, over one or several days, and organized by professional or voluntary tour operators are associated with the chartered transport.

To each its job

Contrary to what we find in Europe, the bus operators in Québec do not usually organize the journeys. This is the job of the tour operators, such as DMC, Transat, who set up the tours and find the customers. Some people act as receptive agencies and work with tour operators. Most of Québec bus carriers limit themselves to the transport portion of the business, by offering a fleet of buses and qualified drivers.

In Europe, the structure of the market differs appreciably. Numerous bus operators do both, producing and distributing tours. These « buses-operators » act as complete travel professionals. In France, the market of group travel represents 3 billions Euro annually.

Baby-boomers at the rendez-vous

We distinguish two main categories within the group travel market, individuals assembled in groups by travel professionals and the groups set up from the start. These last ones often come from clubs, associations, company committees, etc.

The arrival of the baby-boomers (a third of the Canadian population), with more money and free time than any other segment of the population, changes the picture of group tourism. They already have a good experience in travel, mostly acquired as F.I.T. The current boomers (40 – 59 years) are looking for something different from the traditional group travel. Those who opt for traveling in group expect a high comfort, as well as a pleasant group atmosphere.

Tightly packed schedule trips are no longer the rule. Baby-boomers are looking for different ways to be tourists: they want to experience thematic tours, to live a cultural immersion, they want time on their own, and time to relax. In Europe, for example, tour operators count on special events to diversify the offer. They sell the Seville Feria, the Christmas markets in Innsbruck, the Carnival of Nice, etc.

The groups made up of individuals sharing a common interest also constitute an interesting customer basis. These people assemble around a theme, such as gastronomy, museology, ornithology, oenology, sports, etc. There are so many passions which can be the object of thematic outings for targeted customers. A survey by the Direction of Tourism in France confirms that the activities practiced by the groups are more and more diversified, while the themes of culture, nature and gastronomy are the most popular (fig 1).

Fig. 1
Activities practiced by French group tourists in 2003

More than ever, the companies/firms/organisations in the travel industry will have to be very professional. People will expect to see a detailed schedule before departing and that it will be respected. The guide, with the group from the start, plays an important center role, as does the driver, from whom one expects versatility, courtesy and patience.

This can mean significant costs in personnel formation for the bus carriers. In a survey by the Florida International University over 70 carriers in North America, 64% declare investing in staff formation for a better customer service. Many understand the importance of well formed drivers, their main ambassadors with their customers.

Expectations are growing, but value is growing as well. While all included group tours were essentially at the mid and lower range, a luxury window of opportunity is slowly opening. In 2004, Transat has successfully launched high end products in the CAN$4,000 – CAN$5,000 range.

Competition is growing, with new destinations coming of age. For instance, in Europe, Eastern countries like Hungary, Bulgaria and Romania are beginning to be significant destinations with a growing customer basis.

In Québec, group travel will go on, but the offer must evolve if it wants to keep its power of attraction. More diverse formulas will have to be created to attract people not previously interested in group travel. Integrating exclusive elements into the package, unavailable for individual travelers, may become a pole of attraction for these new customers. Finally, developping theme outings may be a winning formula. Among the themes susceptible to have a high level of attraction in Québec, let us mention:

  • Festive events
  • The Saint-Lawrence River and its attributes
  • The wine trail and the country's flavors
  • Québec: the history of a nation and its patrimony
  • The willd life and Nature's great expanse

Furthermore, a renewal of the offered tours will help develop customer loyalty, enticing them to come back for more. Offering segmented tours could also attract the individual Québec tourists, traditionally less inclined to bus travel in group.

Sources
– Filliâtre, Pascale. «Le Tourisme de groupe a encore de beaux jours». L'Écho Touristique, 7 mai 2004
– Carter M., Cheryl et Jinlin Zhao. «A survey of customer service training for motorcoach drivers in United States and Canada», e-Review of Tourism Research (eRTR) , vol1, n04, 2003
– Desvignes, Claudine. «L'enjeu du tourisme en autocar, conquérir de nouvelles clientèles». Espaces, vol 209, nov. 2003
– Désiront, André. «Les baby-boomers se convertissent aux circuits en autocar». La Presse, Vacances Voyages, 10 mars 2004-10-25
– Direction du Tourisme de France et C.O.C. Conseil/Daniel Picon. «Le tourisme de groupe, synthèse des enquêtes réalisées en 2003 auprès des prescripteurs et des professionnels», déc. 2003
– Chaspoul, Claudine. «Fram redessine sa gamme tout autocar», Espaces. Vol. 09, nov. 2003
– Chaire de Tourisme de l'UQAM. «Étude sur l'industrie québécoise du transport par autocar nolisé», 7 septembre 2001.

Catégories
Customer segments Marketing @en

Hotels: the feminine factor

An increasing number of women are circling the globe on business, forcing hotels to change to keep pace. To please this demanding clientele, whose requirements include higher levels of comfort and security, hotels are offering fitness facilities, organic food, perfumed candles and much more.

A 2003 study commissioned by Wyndham International Inc. and conducted by the NYU Tisch Center shows that, in that year, 40% of people travelling to the United States on business were women.

Study authors confirm that, in 2005, this figure will increase by more than 10%; moreover the percentage of women occupying management positions is rising steadily. With distinct preferences and significant purchase power (they have an average annual income of between US$25,000 and US$70,000), women business travellers are opting for places that combine security, tranquillity and comfort.

The following list presents some important facts about women business travellers. They:

  • Are usually single;
  • Are younger and more highly educated (minimum B.A.) than their male counterparts;
  • Have an annual salary of up to US$75,000;
  • Prefer dining alone in the hotel restaurant;
  • Like to feel at home in their hotel room;
  • Are usually members of a customer loyalty program such as Frequent Flyers;
  • Consider business travel an important part of their job (75% of respondents);
  • Never travel with their children (80% of respondents);
  • Schedule free time during their trip (65% of respondents) to go shopping, visit historic sites or enjoy an outdoor activity.

As for their attitude toward technology, the study found that:

  • Most women use the internet to plan their trip (80% use it to book plane tickets and 75% to reserve accommodation);
  • 25% of women like to have high speed internet access in their room;
  • 42% have never used high speed internet;
  • They make calls from the hotel using their own cell phone;
  • 68% do not use a Wi-Fi network;
  • 80% never use the dial-up or high speed access service provided by airports.

From special pillows to silk pyjamas, with or without curlers

Hotels are becoming increasingly aware of this growing market and, in response, are providing products and services specifically geared to their female clientele.

At the risk of reinforcing certain stereotypes, a number of hotels now place perfumed candles in their rooms. Other perks include aromatic oils, women's magazines, padded hangers, a sewing kit, special pillows, relaxation CDs, cook books and even curlers!

High-end hotels provide complementary extras such as shower gel and skincare lotions. Others charge a fee for luxury items like make-up or silk pyjamas, or offer a full range of relaxation services, such as spas, massages and facials. The fairer sex can also count on valet parking or a door-to-car escort.

For ladies only

In some European cities (London, Berlin and Florence for instance) women-only hotels are opening their doors.
In Zurich, Switzerland, the Lady's First Hotel offers services that are important for women: fitness facilities, special menus (organic food), spas and wellness centres, and much more. Owned and operated by women, the hotel welcomes an exclusively female clientele.

Germany also has several women-only hotels:

  • Hotel Artemisia in Berlin;
  • Intermezzo Hotel, also in Berlin, that operates as a B&B;
  • Harz Mountains – Arleta Pension, near Goslar, in north central Germany.

Based on the survey results given by its female guests, in March 2003 the Hilton Park Lane Hotel in London opened a floor exclusively for women. Unaccompanied men are not allowed on that floor.

This was a first, both for Great Britain and the hotel chain. Surveillance cameras and reinforced locks provide added security. In addition to an Internet connection, all rooms on that floor are supplied with fashion magazines, make-up mirrors and health-food room-service meals served exclusively by female staff.

Some detractors see these hotels as a form of segregation, asserting they actually represent a step backward for women because of the isolation involved. The hotels counter with the claim that they provide a particular kind of environment where women can feel totally secure.

Will Canada follow suit?

Even though the trend has not caught on much in Québec or the rest of North America, it is clearly a primarily urban phenomenon. Could it be associated with the perception that our urban centres are unsafe? According to Christiane Germain (president of Groupe Germain and owner of several Québec, Montréal and Toronto hotels) safe, intimate accommodation has been a priority for women travellers for many years.

So, before you sink your profits into building a women-only hotel, you should definitely conduct exhaustive research on the needs and preferences of your current female clientele. Perhaps, like the London Hilton, you might prefer to test the waters by opening a female-only floor.

Sources:
– Vanzi, Sol Jose, « Suite Bliss for the Female Traveler, » Philippine News Online, November 17, 2003.
– Wall Street Journal Europe, « Make Way for the Female Business Traveler, » July 6, 2001.
– Andréani, Frédérique, « Hilton soigne ses clientes, » Le Point, No. 1593, March 28, 2003, p. 26.
– Hotel News Resources, « Study of Women Business Travelers Reveals Their Opinions and Attitudes toward Travel, » October 28, 2003.
– Gaboury, Louise, « Une chambre à soi, » La Presse, February 23, 2002.
– Preston Robert Tisch Centre For Hospitality, « Coming of Age: The Continuing Evolution of Female Business Travellers, » Tourism and Sports Management at New York University (NYU Tisch Center), March 2003.

Catégories
Customer segments Trends

More and more grandparents are travelling with their grandchildren

A 2003 survey by Yesawich, Pepperdine, Brown & Russell (YPB&R) found that one-third of grandparents have travelled with their grandchildren in the last twelve months. In the United States, more than 15% of travel includes children with grandparents. About 21% of this intergenerational travel does not include the children’s parents.

Travelling with the family unit

During the last decade, and especially since 9/11, family values have assumed increasing importance. With spare time diminishing, time spent with family often becomes a priority. When we think of family, we sometimes limit ourselves to parents and children, but in reality, grandparents play an important role within the family unit. This feeling of closeness can translate into the older generation going on vacation with their grandchildren.

This socio-demographic development holds the promise of new opportunities, and at the same time means that we need to revise our traditional clientele segmentation. There are already promotional campaigns specifically addressing this pairing. At the Hilton chain, children under 18 can share their grandparents’ room free of charge. In Loews hotels, seniors accompanied by young people are offered discounts, surprises and special activities. Certain travel agencies even specialize in «grandtravel», organizing tours specifically designed for children and their grandparents.

Passing fad or serious trend?

Today’s parents are caught up in the hurly-burly of an active life and in demanding professional careers. The level of family consumption often requires two salaries. Grandparents, who are retired or semi-retired baby-boomers, are delighted to play a role in parenting. They want to take advantage of opportunities to connect with their grandchildren, and vacation activities can offer quality time.

Another phenomenon is the availability of the parties to go on holiday. In the United States, more than 60% of parents approve of their children taking holidays during the school year, and grandparents generally have a lot of spare time. To this availability, add the financial resources of the grandparents, which make it possible to go on holiday with or without the parents. Another factor is the difficulty spouses often have in arranging simultaneous vacation time.

A growing opportunity

The demand will continue to increase as more baby-boomers go into retirement or semi-retirement. In response to the perceived demand, the American Automobile Association (AAA) even published a book, entitled Travel with Your Grandkids, to help grandparents plan their holidays. The book covers several issues, including how to:

  • convince reluctant parents
  • involve grandchildren in planning the trip
  • strengthen the grandparent-grandchild relationship
  • set limits and establish rules

There is a wide range of activities of interest to this segment, from downhill skiing to science museums, golf, cruise-excursions, theme parks and hiking. The heritage or commemorative element could be exploited as it strikes a chord with grandparents who are eager to pass on their knowledge and to tell to their grandchildren about their personal history.

It is also important to consider what is of interest to the children, especially since they, too, have a say in travelling with their grandparents. The majority (56%) of children between 6 and 17 years old say that they would like to take a trip with their grandparents. The youngest (6 – 8) are the most enthusiastic (78%).

Companies that adopt a targeted promotional strategy during slower periods could also get results. Small details like surprise gifts for young children, or activities that capture their interest can act as triggers when the family is planning a vacation. For example, Mexico City offers a little paradise for kids (Ciudad de los Niños). In this theme park, children play the role of grown-ups, sitting in the pilot’s seat in a real American Airlines’ cockpit, making pizzas in a Domino pizzeria, or feeding a dummy baby inside a hospital. And to be totally consistent, children pay the full price of admission, parents pay half price and for grandparents… it’s free!

Sources:
– White Hutchinson Leisure & Learning Group. «Grandparent/Grandchild Market a Growing Opportunity», October 2003.
– The Philadelphia Inquirer. «Travel with ‘grands’ comes in all flavours», 16 May 2004, p. N02.
– Hugues Court, Paula. «Cruising with Grandchildren», LovinLife.com [www.wwseniors.com], 9 September 2003.
– Buhasz, Laszlo. «Marketing to the new senior», The Globe & Mail [www.globetechnology.com], 11 October 2003, p. T2.
– American City Business Journals. «New travel trend: ‘grandtravel’», 8 November 2001.
– Gardyn, Rebecca. «The New Family Vacation», American Demographics, 1 August 2001.

Commentary from Thomas P. Cullen

This is a topic which should be of interest to many aspects of the travel industry. I believe it is a symptom of a global change in the way markets are defined and in motivations to travel.

The « business market » has traditionally been differentiated from the « leisure market ». However, these boundaries are changing, and I believe that the industry can no longer assume the business trip is for business only. Children are not only traveling with grandparents, they are traveling with parents – blue suit moms and dads, who increasingly take kids along on a business or convention trip. Las Vegas entrepreneur Steve Wynn recognized this many years ago when almost single handedly he transformed the topless, sin city gambling mecca to a family friendly convention destination.

The other quantum change is related to the nature of demand drivers. A review of intergenerational travel packages offered by Elderhostle is indicative of this change. The traditional « architectural » tourism is being replaced by learning/educationally motivated travel, cultural travel, and health related travel.

Worldwide business travel probably accounts for 60% of all travel demand. Within 15 years, perhaps sooner, leisure oriented travel will account for 60%, and business only travel declines as a percentage of the total.  

Communications technologies will replace a lot of business travel as a younger, more technology saavy generation of business people grow into decision making positions in industry. The implications for packaging, pricing, positioning and distributions systems for the hotel, airline, and cruise industries are significant.

Thomas P. Cullen

Professor
School of Hotel Administration
Cornell University
SEE ALSO
Travel – It’s Not Just for Adults Anymore
An essay written by Mr. Cullen

Catégories
Customer segments

Baby boomers, the backbone of the tourism industry

When they were young, baby boomers sported peace signs. Today, they worry about the stock market and the chances of early retirement. Their travel curve will rise but will be difficult to profile.

General characteristics

  • Among industrialized countries, Canada experienced the biggest baby boom.
  • Mass retirement of boomers from 2010 to 2020; their median age will be 55 in 2010.
  • 9.8 million boomers in Canada, or 33% of the population (Foot and Stoffman, 1999).
  • 76 million boomers in the United States, or over 25% of the population (American Demographics, 2004).
  • By the year 2010, the countries of the European Union will be home to 140 million people aged 50 and over (Austrian Institute of Economic Research).

Nothing new in their profile

  • Enjoy high disposable income
  • Tend to be stressed workaholics
  • Demanding, quality-oriented
  • Active, healthy and intent on staying young
  • Interested in learning and new experiences
  • Adventurous

Beyond age and income

It is easy to divide the population into segments according to age and income, but reality is more complex. Lifestyles and attitudes towards ageing are becoming important factors. Some people are healthy and fit at age 70, while others feel old at age 50. In Canada, a 50+ Communication Marketing study defined four segments among those aged 40-plus:

  • the wealthy

    (21%) – satisfied with their financial situation, careful with money, thrifty, with a long-term attitude towards things, rather dissatisfied with their appearance and open to the idea of cosmetic surgery, see their health as an investment (good eating habits, exercising to stay fit);

  • the enthusiasts

    (27%) – are more or less concerned about their financial situation, eternally optimistic, enjoy life's pleasures, open to taking job-related courses and continuing to work past retirement age, sensitive to the time factor (prefer one-stop shopping), often eat in restaurants for fun and to save time, more or less concerned with the state of their health (good food habits and exercising for fun);

  • the careful

    (30%) – make independence a priority (living at home and driving one's car for as long as possible), interested in continuing to work post-retirement, worried about financial security and even more about their physical health, seeking durable products and discounts, with poor health habits (overweight, large proportion of smokers);

  • the worriers

    (21%) – pessimistic with regard to their finances and physical appearance, looking for products to help them regain their youth both mentally and physically, feel a loss of energy, seek a good quality-price ratio, think they should improve their eating habits.

A wired clientele

In the United States in the 50-58 age group:

  • 62% have access to the Internet. Of that number, 75% read the news online and 55% do information searches.
  • 76% use a computer on a regular basis (Pew Internet & American Life Project).

In Quebec, in the 45-54 age group:

  • 55.4% use the Internet on a weekly basis (Cefrio).

Baby boomers who travel

In the United States, boomers travel more and spend more than any other age category:

  • 44% of all trips, or 241 million trips in 2002.
  • US$491 per trip, excluding transportation (Travel Industry Association of America).

In France:

  • 48.7% of 50-somethings make travelling a spending priority versus only 40.3% of the national average (INsee and Notre Temps magazine).

Coveted tourism products

  • Growth of the high-end market.
  • Gradual decline in travel to the south and to resorts in favour of adventure and ecotourism products (observation of wildlife in Costa Rica, travel to Irkutsk on the Trans-Siberian Railway).
  • Increase in demand for cruises and diversification of this product with smaller craft offering quality trips to limited groups.
  • Demand for packages and personally tailored vacations.
  • Increase in passive activities (golf, walking, bird-watching, etc.) and cultural pursuits.
  • Popularity of safe destinations.
  • More frequent travel to nearby countries.
  • Popularity of bus trips for tourists who want to leave responsibility behind and be pampered – low-kilometre itineraries to enable travellers to get to know certain regions in depth or tours to little-known countries.

Look for uneven growth

Expectations about the rising boomer travel curve will have to be revised. Although this clientele will be very sought after, it will not behave uniformly. Some boomers will go into semi-retirement, or take progressive retirement. Others will retire later, or have less money upon retiring than anticipated, for the following reasons:

  • lower returns on pension funds, due to dropping share values and low interest rates;
  • a growing disproportion in the number of pensioners to workers – money is being withdrawn from retirement funds faster than it can be put in because there are fewer workers to make contributions;
  • recent corporate governance scandals have compromised employee pension plans;
  • the government will probably raise the official retirement age;
  • more and more workers will be asked to continue working because of their experience;
  • many people already receiving pension benefits will return to work.

With today's longer life spans, people must make their post-retirement revenues last longer, which reduces annual income. Many fear that their pension plan will expire before they do.Sources:
– 50+ Communication Marketing. « Une étude marketing sur le marché des baby-boomers et des personnes âgées, » press release, April 28, 2004.
– La Presse canadienne. « Les baby-boomers rêvent maintenant d'une retraite progressive, » February 16, 2004.
– Research ALERT. « Leading-Edge Boomers Approach Senior Status, Changing the Face of Aging, » vol. 22, no. 8, April 16, 2004.
– Sarrasin, Bruno and Guy-Joffroy Lord. « L'évolution du tourisme international : une analyse prospective à l'horizon 2010, » Téoros, fall 2003, p. 5-9.