In the wake of the terrorist bombings at the airport and a metro station in Brussels last week, the travel industry found itself struggling with a significant challenge: how to persuade a shaken traveling public to continue to hop the pond and remain loyal consumers of European destinations and travel products.
The Brussels bombings, which killed 34 people and injured hundreds of others, came just as travel to Europe was beginning to recover from the Nov. 13 terror attacks in Paris.
“We do expect understandable consumer caution and hesitancy,” said Paul Wiseman, president of Trafalgar, which had numerous Europe cancellations post-Paris but then saw bookings stabilize. “Generally, we have seen that new bookings are typically more affected by world events than existing [bookings].”
He said the full impact on travel of the Brussels attacks will be able to be measured only as events continue to unfold in Europe. It was too early last week for many travel companies to assess whether the terrorism would spur major cancellations to Belgium, France or Europe at large.
In the meantime, Wiseman said, “It will be an important role for those of us in the travel industry to build confidence in travel. Agents can protect their business by reassuring that travel is a great thing to do.”
There are a couple ways to do that, according to Tom Jenkins, CEO of the European Tour Operators Association. He said it’s important to put the attacks into context.
“We have to place what happened within the other context of risks posed by, say, drunk driving and people being a victim of a drunk driver or someone texting behind the wheel or of dying of medical malpractice,” Jenkins said. Against those kinds of everyday threats, “the threat posed by ISIS is minimal,” he said.
Citing recent incidents in San Bernardino, Calif.; Sydney; and Tunisia, Jenkins pointed out that terrorism is a global threat, not unique to Europe, where security is currently “extremely tight.”
Following the attacks in Brussels on March 22, the U.S. State Department issued a travel alert for Europe, warning that, “European governments continue to guard against terrorist attacks and conduct raids to disrupt plots.”
The alert advised U.S. citizens to avoid crowded places and exercise vigilance when in public places or using mass transportation, but it did not advise against travel to Europe.
Will bargains trump fear?
Travelers often have a knee-jerk reaction to terrorist attacks, and Jenkins acknowledged that an informed perspective does not come easily or quickly, especially when shocking images are splashed across the news.
Even so, he said, in even the most challenging environment, there is a way to restimulate demand, and the key is attractive pricing.
“Fear does a lot of damage in our industry, but there are ways of overcoming that fear,” Jenkins said. “The late, great Bob Whitley [former president of the U.S. Tour Operators Association] said immediately after 9/11 that ‘America always travels if the price is right.’ The travel industry has never been better placed to offer, rapidly, the stunning value that Europe will represent to the American people.”
However, Europe had already presented a great value to travelers well before the terror attacks in Paris and Brussels, thanks to the strong U.S. dollar against the euro. Favorable exchange rates on travel products had been expected to spur healthy demand for travel to Europe this year.
Instead, travel companies are now finding themselves searching for ways to combat a slump in interest as travelers face an increasingly uncertain security environment in some key European destinations.
Steve Born, senior vice president of marketing for the Globus family of brands, said: “That ongoing incidents like Brussels will affect some travelers’ decisions to go to Europe is no doubt something all of us will have to deal with when creating promotional plans moving forward.”
Tour operators had already rolled out some aggressive deals at the start of the year to help reignite demand post-Paris and get 2016 Europe bookings moving again. They admitted that the Paris attacks had delayed the traditional start of the booking season a bit but reported that with early booking discounts and attractive airfare offers, they were likely going to be able to recuperate any potential losses.
With the Brussels attacks striking just at the start of the Europe travel season, however, the strong recovery foundation that the industry had in the wake of Paris has been significantly disrupted.
While further discounting might help, operators acknowledged that they will have to be careful with that strategy, as it can negatively affect the bottom line.
“We have no doubt that those companies with large, inflexible, fixed inventory will, and already are, doing aggressive price discounting,” Wiseman said. “Unfortunately for the travel agent, this means aggressively discounted commissions, as well. Trafalgar holds pricing, and while we do targeted tactical discounts, they do not have a major impact on the agents’ commission.”
Before it comes to that, travel companies are hoping they can at least keep their existing bookings and instill confidence in future bookings by offering generous and flexible rebooking policies.
For example, AmaWaterways, which is just starting its springtime river cruises in Belgium and the Netherlands, said it will allow any travelers who wish to cancel their Tulip Time cruise to switch to another cruise in 2016 without penalties.
Despite the challenges in France and Belgium, there remain plenty of bright spots throughout Europe, notably countries that were not directly impacted by the recent terror activity. Operators have reported very strong bookings for Spain, Portugal, Eastern Europe, Scandinavia and Iceland.
“Europe remains one of our most popular travel destinations,” said Julie Hall, AAA’s public relations manager. Still, she added, “Some travelers may opt to take more domestic trips this year based on their own comfort level. Ultimately, the decision to travel is a personal one that must be made by the traveler.”
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