Sounding Off: The unspoken reality is that demand may collapse


Chris Hemmeter, Managing director, Thayer Ventures

“I just think this whole idea that the world has changed forever and that human behavior is fundamentally now going to be changed forever – once there are treatments and a vaccine for this – is wrong.”

Quote from Chris Hemmeter, Thayer Ventures’ managing director, in an article on PhocusWire this week about the likelihood of fundamental changes in the travel industry, post-coronavirus.

Each Friday, PhocusWire dissects and debates an industry trend or new development covered on our site that week.

There are two opposing schools of thought emerging about how the travel industry is going to look after the coronavirus outbreak.

The short versions: very little will have changed if we look at two years from now; and everything is going to fundamentally change forever.

Firstly, nobody should even be thinking about the so-called “new normal” being something that arrives either gradually or slowly after the pandemic is defeated. 

There is a fairly strong chance, according to various scientists, that the latter months of 2020 will see COVID-19 return in some way as part of a second wave of infections around societies – perhaps even earlier.

Recovery, therefore, is not going to be a linear process and travel brands should plan for those types of eventualities.

What is increasingly clear is that the proclamations and forecasts from those in the industry (including us in the media) are based on our experiences of how it all works, through our lens, with our expectations.

Often lacking in the analysis are two important variables: consumer confidence and the consumer’s ability to afford to travel.

Any apparent return to normality is going to influenced by those two factors more than any others, including the ability to keep planes and accommodation clean and virus-free, or coming up with innovative ways to keep a business afloat.

There will be no genuine way to measure those two effects until airlines put planes back in the skies or accommodation providers open their doors once more.

What the industry should be bracing itself for is to be hugely disappointed that demand isn’t there because, simply, consumers are too fearful to travel or have lost their discretionary spend.

That’s the important conversation that should be also taking place in the boardrooms of every brand on the planet.

PhocusWire’s regular editorials

 



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