The FINANCIAL — Confidence is continuing to return to the UK travel sector with over two-thirds (67%) of senior industry representatives expecting travellers to journey more in 2014 than they did in 2013.
The FINANCIAL — Confidence is continuing to return to the UK travel sector with over two-thirds (67%) of senior industry representatives expecting travellers to journey more in 2014 than they did in 2013. Only 1% of respondents to the Barclays Travel Forum 2014 sentiment survey are expecting less travel this year. When asked the same question twelve months ago on expectations for travel in 2013 compared to the year before, just over half (52%) of respondents were expecting more travel from consumers, according to Barclays, an international financial services provider.
The survey of over 200 senior industry representatives from tour operators, travel agencies, online agents, cruise companies and other travel businesses also shows that travel industry leaders have a more positive outlook for their own businesses with half of respondents more confident compared to 33% twelve months ago. A further 29% are very confident compared with just under one-fifth (19%) this time last year. One in ten remain cautious about their business prospects this year, down from 17% last year.
In terms of business growth, almost three-quarters of respondents (74%) are expecting growth in their business in 2014. Almost 30% are expecting to see growth of 10 to 20% with a tenth forecasting growth of 20% or more. Looking ahead to 2015, 81% are expecting their business to grow with 11% expecting a major uplift of 20% or more with 2% seeing some contraction, according to Barclays.
When asked what would prove the most important tool for growth in 2014, the top selection with 22% of respondents was increased marketing spend. The least popular option was more aggressive pricing at 4% which was down from almost a quarter (23%) this time last year. The biggest drop on the year before was an increase of quality of product, 16% down from 41% in 2013.
Europe (36%) is set to see the greatest increase in tourism from UK travellers this year while almost a quarter (24%) of respondents expect it to be South America and similarly another 24% forecasting it will be Asia. This time last year, the industry indicated that both Asia (32%) and South America (32%) would record the greatest increase with Europe registering 27% of the vote, according to Barclays.
“This growing optimism is welcome news to the travel industry, particularly given the low levels of discretionary spend the sector has witnessed over recent years. Confidence is clearly growing among those senior leaders who attended the Barclays Travel Forum, and with broadly supportive economic conditions, it appears that growth is becoming more sustainable. The continuing appreciation of sterling against the euro, for instance, will obviously be an important factor in helping Europe account for the biggest growth in tourism this year,” said Chris Lee, Head of Travel at Barclays.
The external factor causing the travel industry most concern in 2014 is global political unrest with almost half of respondents (47%) selecting it as their primary concern. The next most pressing worry is low discretionary spend, 15%, down from 34% in 2013, followed by the effects of regulation, 13%.
Other key findings from the survey:
All inclusive has the greatest growth potential this year, 22%, with cruise the least at 4%
28% of respondents do not see social media important to their growth strategy. 18% see it as very important and 54% as somewhat important
80% think the demand for business travel will increase this year, with 22% of this figure believing there will be a major increase
39% see no difference in the level of overseas bookings during the period of this summer’s football World Cup, 36% see bookings down by up to 5%
Almost a third (31%) believe London’s airport capacity limits are having a negative economic impact with a further 60% saying that although it was having no negative impact yet, it would do going forward
The majority of respondents (49%) believe a new runway at Heathrow would be best placed to address capacity issues
Discussion about this post