Is Your Company Ready for the Consumer Travel Comeback?


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By: Beth Vendice, President, Mercury Media Boston

We’ve seen lots of evidence lately that the travel industry is in recovery. But are destinations and hotel chains prepared for it?

PricewaterhouseCoopers’ updated US lodging forecast expects continued recovery of consumer travel demand, increasing past the point of increased bookings to the point of actual revenue increases. PwC says the ability to increase room rates will return in 2011, after two consecutive years of decline. “The initial months of 2010 suggest that a sustainable recovery of lodging demand has begun,” its recent report says. “As businesses and consumers gain further confidence in the strength of economic recovery, discretionary spending is expected to continue to increase, contributing to progressive increases in lodging demand through the remainder of 2010, though the pace of recovery is expected to moderate.”

With lodging supply growth expected to lag demand growth for the first time since 2006, PricewaterhouseCoopers expects hotel occupancy levels in 2010 to increase. Average daily rates (ADR) are not expected to increase until early next year, resulting in a moderate occupancy-driven increase in revenue per available room (RevPAR) in 2010, with a more substantial, rate-driven recovery in RevPAR expected in 2011.  What is this report really saying?  Consumers are planning, and so should the companies that hope to get their business.

The planning stage means consumers have decided to travel. They are “in market” and when consumers are “in market” companies need to be “in market” too. That’s a simple business fact. But what’s not so simple is the way a travel company gets “in market.” In my experience the best way to make that gamble is through direct response TV. It is the only way to put a destination or property in front of “in market” customers with complete confidence that the ROI will measure up. DRTV says “right now” to that customer who is ready to book a trip. It also indicates that your company is “in market” right now.

We’re currently booking late summer and early fall media. It is becoming urgent for travel companies to test concepts for DRTV if they’re not already doing it. It is also becoming urgent for companies to invest in that 2011 turnaround where it looks like profit is reachable after two tough years. And here are your choices: Select media that does not hit your target right where it lives and spends, or select media that is trackable and open to optimization. Those are the two routes to capture the 2011 comeback.

Companies that are not “in market” are simply giving business to companies that are in market. Consumers have certainly entered the game.

Beth is President of Mercury Media Boston and is responsible for leading the strategic direction and day-to-day operations of the national short-form practice.  Since joining Mercury in 2001 she has led the firm to significant year-over-year growth by attracting clients that include Mandalay Bay Resorts Group, LifeLock, Boost Mobile, Conair and Vegas.com.

Beth can be reached at bvendice@mercurymedia.com

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