A Peek Into How COVID-19 Has Impacted The Travel Sector
It is absolutely needless to mention that, with the restrictions on travel and people becoming more cautious day by day to leave their homes, the travel and the hospitality industry is one of the worst affected due to COVID-19. This situation somehow gives us the flashbacks of 9/11 when after the attack, the demand for travel fell drastically for straight five months. With the number of cases soaring day by day, an immense number of people have been cancelling their travel plans. There has been a decline in bookings for about more than 50% as compared to pre-COVID. Personal travel is obviously at zero levels, but work-related travel particularly on-field jobs have been cut to a minimum.
Travel plans getting cancelled has severely hampered revenue for online travel aggregator platform (OTAs) such as MakeMyTrip, Cleartrip, Yatra, among others. The coronavirus impact on the business of OTA platforms had also led to a major fall in their share prices. Moreover, few service providers had also announced that they will not charge any cancellation or processing fee for rescheduling or cancellation of domestic and international flights till 30th April. With this, the losses of the company are expected to rise way further. The CEO of Make My Trip, Deep Kalra also had announced that they would draw zero salaries, and the rest of the company’s leadership and management team has offered to take a 50% salary cut, starting April 2020. Deep Kalra also said “We are reviewing our operating costs and plan to undertake multiple tough measures to keep overall expenses at a minimum,” which will involve a reduction in advertising, sales promotion, payment gateway costs, etc.
The hotel industry has also been harshly affected due to a negligible number of bookings and increased expenses because even if one person books a hotel he/she will definitely make sure whether that hotel is maintaining safety standards or not and that is the reason hotels are now undertaking several safety precautions so as to ensure absolute safety to their guests which have resulted in increased cost. The major problem is that their revenue stream is disturbed while their expenses have become heftier. Now, travellers are scared and not very confident in booking online and or experiencing IVR related call waiting, thereby increasing the need for an immediate and personal touch. OTA’s have to setup regional level customer desks, thereby increase in cost. Also, smaller boutique agencies will see an increase in demand.
After all this, as a business consultant and strategist, I truly believe that despite the trouble this industry is facing, every crisis, including this pandemic, comes with an opportunity. The post-COVID-19 can hold a lot of opportunities for the future of travel. With domestic travel routes opening up gradually, the travel companies need to shift their focus from international dream destinations to more of “local dreams”. The travel companies must serve the needs of domestic travellers with guns blazing. Also, once the aggression COVID 19 comes down, visa processing will witness a lot of activities with the cleaning of backlogged applications and from people relocating and travelling for work. This will open up an opportunity for more efficient application and screening processes.
With more and more demand for hygiene and sanitation among the customers, travel companies can certify COVID-19 ready vendors on their websites or mobile apps. With this strategy, the companies can deliver a complete COVID safe travel experience to their users.
Though the time for the travel industry is dull now, it will boom in the later future. It might take a while for things to get back to normal but it is pretty good to witness that people are now developing new passions and working on their talents at home. Staycations and Workations are already trending all over social media. This gap in travelling has actually made the people realize the importance of travelling, it helps you to learn, yearn and grow. I hope we all will overcome this time and triumph over the virus.
Looking forward to travelling.