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EMEA travel recovery: what's the data telling us?

July 15, 2020
Matt Webb
By 
Matt Webb

Green shoots of recovery in travel are finally starting to show. Borders reopening, growth in capacity, and occupancy rates are all encouraging — but we’re not out of the woods yet. There’s still a lot that we don’t know, but what is clear is that recovery is varying hugely between regions and by country, as different approaches to risk vs reward are taken. 

We also know that the path to recovery is unlikely to be linear, and will go through peaks and troughs aligned to the progression of case numbers. The US is the perfect example of this. After a strong initial restart, travel has dipped slightly following a resurgence of cases. But this isn’t unexpected, and other countries may follow suit if the anticipated ‘second wave’ transpires later this year. 

Elsewhere, APAC — the first market to be heavily impacted by the pandemic — has been slow to start recovery. But the introduction of travel bubbles looks set to reconnect the region, holding great promise for the months ahead.

But I want to focus on the trends that we’re seeing in EMEA. As an extremely open market, closing borders had a staggering effect not only on the travel industry, but also for the wider tourism sector. So now, Europe is on a mission — open up and save the summer. And the Middle East is restarting with a similar campaign too. In this blog, I’m sharing key EMEA insights from Travelport’s new Confidence Index, as well as global recovery trends, EMEA regional trends, and a spotlight segment on France. ​

So, let’s look at what the data telling us...As we all know, travel ground to a halt in Q1 this year. To gain more insight into what's happened since the world has started to slowly open up again, I've chosen to focus on the dates from March 30 to June 30. This provides a more appropriate and up to date view of the market.

Measuring recovery through Travelport’s Confidence Index

Over the past few months, Travelport has been working hard to ensure our customers are well-equipped for the recovery period ahead. To support the industry at large, we have developed a Confidence Index — which measures a market’s appetite for travel, based on indicators on search and booking data. The data provides insights on where travelers are going, when they are traveling, and who is likely to be traveling — from both a broad market view, right down to different traveler personas. 

EMEA Confidence Index

The methodology works as follows:

  • Air search is the highest indicator, as that shows the highest level of confidence and intent to travel. 
  • Hotel Search is starting to guide as to where travelers are looking to stay.
  • Air Bookings actual conversion is the strongest indicator of recovery and carries the greatest weight in the algorithm. 

This tool was created using some insight from activity from previous years, plus our week-over-week indexed view of gross traveler behaviors, transacting through the GDS for air and hotel products. While this is interesting, we wanted to avoid a subjective sentiment score, as we believe that real travel activity is a better gauge of consumer confidence. And you can see above, we have this covered across the broad array of EMEA countries.

  • Cyprus is leading the path to recovery. It’s number 1 for EMEA and actually number 1 on our global view
  • Russia, ranked 3rd on the INDEX is number 1 for volume in EMEA
  • A little later we’ll cover France in more detail

Emerging global recovery trends 

Global recovery trends

The following are some of the common trends that we’re starting to see appearing worldwide:

Consistent signs of travel recovery 
The stage of the recovery journey varies greatly by region — and likewise, within that region, some countries are performing better than others. As mentioned above, the risk vs reward strategy has very much determined where a country sits on the curve, and it is unclear what shape that curve will take. But we are seeing a consistent pattern of recovery emerging. 

Markets are reopening, and changing their border policies daily
As people realize they are allowed to travel again, bookings are starting to follow. This is helping the industry to return to business, but equally means that travelers and businesses are struggling to keep on top of the latest developments. Earlier this year, Travelport developed its COVID-19 hub to assist travel businesses with this exact challenge.

OTAs are showing the strongest signs of recovery first
As offline travel agencies have been forced to close their stores during lockdown, the value of being able to retail online is more evident than ever. The OTA market is currently ~40% above the recovery position of other travel retailers — presenting not only great opportunities for air bookings, but also in upselling ancillaries. As the online consumer market picks up, recovery rates across the other sectors will start to improve too.

Now, let’s jump into the EMEA data.

EMEA region travel trends

EMEA Trends

As I mentioned above, Europe and the Middle East are both on a mission to open up and save the summer. Here are some of the other key insights you need to know:

EMEA Countries

  • Every sub-region is up each week
  • Russia, Norway, Eastern Europe, and Italy are performing particularly well
  • Italy — which was hit so hard by the crisis — began their recovery journey driven primarily by domestic travel, and is up to an Index of 26.
  • The UK’s recovery has been steady, and with the loosening of the quarantine restrictions we expect to see this dramatically change

Spotlight on: France

We know that recovery will vary greatly by region — and likewise, within that region some countries are doing better than others. As we were exploring and observing recovery trends, what became clear was that France could be a model for many more countries in EMEA. 

Confidence Index Trend

France is showing strong signs of recovery, with our Confidence Index at 27. All components of the Index are now helping France realise this strong form. And it may only be ranked 10th on our index, but if we looked at volume, it would only be 2nd to Russia in EMEA.

Some key demographics to keep in mind here:

  • Prior to the COVID-19 crisis, international trips typically led the way in France, with North Africa, US, and East/South-East Asia all usually ranking high
  • Trips are usually booked anywhere from seven to 60 days out
  • Ignoring corporates, families is the biggest persona

France Trends

We are comparing the last four weeks 2020 in green to an average in 2019 in grey
The table shows the top moving origin and destinations from the last four weeks. And then on the right we will look at key buying behaviors – personas and lead times for Paris to Pointe A Pitre.

The insights allow us to analyze the change in traveler behavior in France by the type of trips people are taking, buyer personas, and trip lead time. 

Type of trip

Confidence Index Geo Split

Like so many countries in recovery, domestic is now leading the way, but unlike many, intra-region and international are following a similar upward curve and this can be seen reflected in the Geo split.

Some key destinations from Paris are worth calling out: Fort de France, Nice, Reunion Island, and Pointe A Pitre. Specifically, for Pointe A Pitre (on the right hand side of the previous graphic) we see the evolving consumer/persona landscape, which, on the whole is stable.

Buyer personas
Families remains the strongest buyer persona, meaning strong commercial opportunities for airlines and hotels. As is to be expected, group bookings are down, but solo travel is growing. So, for travel businesses in EMEA, these personas are a strong target for your upcoming marketing activities.

Trip lead time
Next, look at the variance of lead times from 2019 to 2020. Bookings have clearly subsided over the past three months, but based on the comparison to last year, we now see bookings grow abnormally in the 30-60 day buckets away from 90-150, all helping lead the ‘Save the Summer’ mantra.

Use data to inform your recovery strategy

We can see that EMEA, along with other regions, is flowing into recovery — and this is encouraging. Though it remains to be seen how the region’s curve will take shape, the market is coming back to life.

The example above of France shows the typical kind of data we are looking at with our customers right now. First, we identify the moving, growing city pairs.  Then, we examine buying behavioral metrics, so that our customers can develop the most effective targeting and acquisition strategies. 

This in turn makes tailoring additional products and services much easier. By leveraging this kind of data, you can feel assured that you are making informed business decisions that will accelerate your recovery. 

I spoke more about EMEA data insights on our recent Recovery Trends in Travel webinar — held in conjunction with IHG and Skylord Travel. If you missed out, you can listen back here. Or, to find out more about Travelport’s Confidence Index, or how our data services can help inform your recovery strategy, contact us today.

Watch the EMEA webinar

Missed our Recovery Trends in Travel webinar? Watch it now on-demand.

Want more data insights on how the EMEA region is recovering? Contact us today.