The Travel and Tourism Industry in the Lockdown Economy
Article by Kelly Chen
The lockdown due to the pandemic has a great impact on global business. In particular, the travel and tourism industry is having a hard hit. Recently, the Lockdown Economy Initiative interviewed five business owners from France, Mexico, Nepal, Indonesia, and the US, respectively. These videos revealed how their businesses were affected, what measures they are taking to adapt to the new situation, and what help they still need for the near future.
The five business owners that the Lockdown Economy interviewed are all involved in the travel and tourism industry. Monique Y. Wells is the co-owner of Entrée to Black Paris, a travel business in Paris that has targeted the African American travel market since 1999. Mimí Novelo is the founder of Tiempo Libre, a 35-year-old travel agency in Yucatan that focuses on international tourism. Shivangi Shah Singh is the managing director of Travel Design, a travel business in Kathmandu that provides outbound tours to exotic destinations around the world and offering budgeted packages to local Nepalese clients since 2013. Nila Warti is the owner and director of PT Kalimantan Tur Grup, a tour business in Kalimantan that has targeted European and US travelers visiting Kalimantan island since 2019. Elie Sasson is the CEO of Green Dream Tours, a tour business in the San Francisco/Napa/Sonoma area that provides various theme tours including wine country tours, cannabis and craft beer tours, and sightseeing tours.
All five companies had been thriving before the pandemic. However, due to the lockdown, travel restrictions were placed. Many flights were cancelled and airfares were increased due to limited supply and additional required compliances. The travel and tourism industry is closely related to the hospitality industry as it is associated with lodging, food and drink service, etc. However, the recommended social distancing discouraged potential customers from travelling. As a consequence, all five companies lost a great percentage of their business. For example, Tiempo Libre had no income for several months since this March, and Travel Design lost sales by 80% during the pandemic.
An instinct strategy that some of the interviewed business owners used is securing old customers as much as possible. For example, Monique writes to customers, keeps public exposure of her in related communities, updates her blog and newsletter frequently to keep connections, and maintains customers’ interest in the Black Heritage and beyond in Paris. Mimí keeps in touch with her customers in her own way: she provides weekly online trips around the world via Facebook to keep people enthusiastic about travelling. Shivangi actively helps her customers arrive safely in Nepal. For example, she found charter flights to secure 1000 customers from Kuwait and provided 24-hour service without sacrificing quality and safety. Nila, on the other hand, tries to convince her customers to postpone their trips till next year when possible with the same cost as before.
The second effective strategy is to change your business target in order to find new customers. For example, because fewer American customers can fly to Paris during the pandemic, Monique relies on information technology (IT) to develop new business. She successfully conducted a walking tour with Australian journalist Oliver Gee via podcast and presented to some study-abroad groups regarding Paris via video conference software. At the same time, Monique is actively targeting French and other Schengen zone travelers. Mimí, Nila, and Elie have also shifted their focus to local customers. For example, Mimí is focusing on tours within Mexico that can bring real revenue and Nila now targets those European and USA travelers already in Indonesia.
The third strategy that the business owners used was creating new service programs and business incentives to attract customers. Monique is planning several new walking tours and a wine tasting tour. Meanwhile, Mimí has developed tailor-made trips within Mexico for small groups. Nila, alternatively, teamed up with her friends that sold handcrafts to create new tours while helping each other’s business. She has also held virtual tours of wild nature for customers who cannot come in person as well. Additionally, she is cutting the price of her services to keep the business running.
Overall, these strategies are effective to various extents. Due to the existing pandemic, these business owners’ businesses are still slow. When asked about problems they have, how they have been assisted, and what they expect in the future, Mimí responded that she was not too worried about her company due to the great profit it made over the past 3five years. Monique and Elie mentioned that they received some types of financial help from their governments. Nila expressed the need for financial aid to help with the increased demand for website maintenance, and the desire to gain more knowledge and skills regarding digital marketing and digital material support. For virtual tours in the middle of the jungle, she had concerns about the internet signal in the field. Shivangi felt that, in addition to government support, she would like to have more health and safety guidelines and emergency services from the government. Elie is expecting marketing efforts at the state and local government level in helping small businesses advocate the news that they are ready for reopening when things start to turn around.
It is unclear when the travel and tourism industry will be back to normal, however, all of the business owners expressed certain optimism. Mimí is viewing this pandemic as a chance for self-invention. Her company is using the time as a learning holiday to train the team members and to be prepared to do something different and innovative. Monique reminded people to be mentally strong, to ask what they want, to set short-term and long-term goals, and to change directions when needed. It is also uncertain whether the travel and tourism industry will end up different after the pandemic due to the economic impact and the introduction of various high technologies. As Nila pointed out, people should keep learning new skills to develop new ways of doing business.
While the above interviews are only from five small business owners in the travel and tourism industry who are surviving the lockdown, the lessons one can learn from their stories are typical and helpful for entrepreneurs facing difficulties in the future. For more details, click the following links for the full videos for Monique, Mimí, Shivangi, Nila, and Elie.