According to the survey, which was conducted in late October with an 88% response rate of USTOA Active Members, two thirds (69%) of respondents say they are confident or highly confident that guest bookings will increase in 2021. Nine out of 10 members expressed their company’s outlook for resumption of business in 2021 is optimistic or cautiously optimistic.
When asked about growth in new bookings in the last 60 days, two thirds (63%) of tour operator members reported an increase in new bookings, while 29% reported no change with bookings remaining the same. Terry Dale, president and CEO of USTOA added, “In August, we asked the same question and only a third (38%) of Active Members had seen an increase in bookings for the two months prior, showing a positive increase in momentum in consumer travel planning since early summer.”
As a follow-up, USTOA asked when new passengers are booked to travel, based solely on bookings made in the last 60 days. Active Members reported the following:
- Roughly 92% of Active Members are reporting travel bookings third quarter of 2021, while three fourths (79%) report new bookings for the fourth quarter of 2021.
- Two thirds (69%) report passenger bookings for second quarter of 2021, while a third (33%) report new bookings for first quarter of 2021.
- A quarter (21%) of members report bookings for Q4 2020 and 60% report 2022 bookings.
- The remaining 2% reported no new booking in the last 60 days.
Cancellation/refund policy was named as the number one most frequently asked question from Active Member guests who made new bookings in the last 60 days, followed by health protocols in second and health/COVID insurance policies in third. Likelihood of travel ranked fourth, followed by changes/limitations of itinerary. Size of group was asked least frequently.
Working Alongside COVID-19
Half (49%) of responding tour operator members operated or will have operated tours/packaged travel itineraries between July and December 2020. The Active Members who have operated during the coronavirus pandemic were then asked what the biggest challenges were in operating this year. Different quarantine restrictions in states/countries ranked first, followed by coordination of protocols across states / borders, and limited availability of rapid testing came in third. Flight availability / scheduling / connectivity ranked fourth. Customer reluctance to comply with protocols was named the least challenging.
USTOA also asked what feedback Active Members received from customers who traveled with new wellness protocols put in place. A third (33%) of members said that all of their customers reported that new wellness protocols did not hinder their experience, while another 29% said only a small number of customers reported that the wellness protocols put in place hindered their experience. Dale noted, “The remaining 38% had not gathered feedback relating to health protocols which indicates that there was very limited negative feedback by customers.”
The age groups of passengers who traveled and are booked to travel between July and December 2020 are as follows:
- Roughly 43% were baby boomers between the age of 56-74
- The next highest category was generation x (ages 40-55) at 26%
- Millennials (ages 24-39) followed at 15%
- Generation Z (ages 23 and younger) were at 8%
- And the remaining 8% were ages 75+
Restarting Operations in 2021
For remaining half (51%) of USTOA Active Members who did not operate or do not plan to operate in 2020, a third (31%) of those members say they plan to restart operations before a COVID-19 vaccine is available. More than half (54%) remain unsure whether they will operate before or after a vaccine.
The same group was asked if they will restart operations with the availability of rapid COVID-19 testing at airports and 42% said yes, while the remaining 58% are still unsure.
“Two thirds of Active Members plan to resume operations - alongside COVID-19 - even if that means lower passenger numbers or lower margins which is an encouraging sign for the resumption of business,” said Dale. Only six percent of responding Active Members plan to wait until they can operate at normal capacity before restarting operations.
Customer confidence was named as the biggest challenge or obstacle to operating in 2021. Border closing and confusion across countries/states followed, with uncertainty of COVID-19 vaccine in third. Coordination of protocols across states/borders/suppliers ranked fourth, followed by the availability of rapid COVID-19 testing, flight connectivity, COVID-19 insurance coverage, the news media cycle, and insecurity about suppliers (closure of hotels and others, inconsistent pricing, etc.) in last.
Travel Advisors
Reinforcing the significant contribution travel advisors make overall to USTOA members’ businesses: 88% of responding members plan to utilize travel advisors to generate sales as they resume business in 2021. Adding that 80% of members report that travel advisors will play very important or important role in their business in 2021. Three fourths (72%) of members expect business booked by travel advisors to increase or maintain the same in 2021.
Trends and Forecasts
When asked what the top three international destinations that travelers are booking, based on new reservations only, Italy topped the list. Dale added, “Italy topped last year’s hot destination list, and despite the challenges of the current pandemic, remains a top contender year after year.”
Ireland followed in second, with Germany, Greece and the UK tied for third. “We saw Europe have a strong presence in last year’s survey and PwC’s survey the year prior, showing us that there is still strong interest and growth for European travel amongst US consumers.”
On the home front, Alaska, Arizona, and California tied for first as the top domestic destinations that travelers are booking (based on new reservations only). Florida and Utah tied for second, followed by Wyoming in third.
Based on new customer bookings, Active Members named small group tours as the most popular travel product for 2021. Private groups ranked second, followed by FIT, river cruising, small ship cruising, and classic group tours (25+ passengers). Ocean cruising (medium to large ship) was named the least popular.
Active Members believe safety and wellness will have the strongest influence on consumers choosing a travel destination in 2021. Border reopening/government travel restrictions will have the second strongest influence on travel destination decisions, followed by distance/ease of travel to and from destination, value, and outdoor components.
“It comes with very little surprise that pandemics/other health crisis was named as the number one potential threat to consumer confidence for the year ahead,” said Dale. Recession was named the second global risk that could impact consumer confidence in 2021, followed by global financial instability in third.
Destination Update
Nearly two thirds (65%) of current Active Member traveler bookings are to international destinations, the remaining 35% of traveler bookings are to North America (US, Canada, and Mexico). Dale stated, “When we first asked this question in the May survey, 80% of current membership bookings were to international destinations, with 20% of bookings in North America. As the year progressed, we have seen a gradual increase of North American bookings, now at 35% of the overall portfolio.”
USTOA Active Members plan to take a destination-by-destination approach to resuming operations around the world. “What we are seeing from this survey is an overall shift in optimism for several international destinations from a first quarter 2021 restart of operations to the second quarter of 2021,” added Dale.
USTOA asked when Active Members anticipate restarting operations in destinations around the world, the results are as follows:
- Africa:A quarter (28%) of members anticipate a first quarter 2021 return to the region, while another quarter (28%) say second quarter of 2021. When USTOA asked in August, 43% of responding members were anticipating a first quarter of 2021 return.
- Antarctica: Almost half of responding Active Members do not see returning to Antarctica until the fourth quarter of 2021. According to the survey conducted in August, 42% were projecting to return between first and second quarter of 2021.
- Asia: Roughly 40% of respondents anticipate resuming operations in Asia in the second quarter of 2021, while another quarter (25%) say first quarter 2021. This shows a shift from the previous USTOA survey in August where 38% of members anticipated a first quarter 2021 return and 22% reported a second quarter 2021 restart.
- Australia, New Zealand and the Pacific Islands: Half (50%) of USTOA Active Members are looking at the second half of 2021 to return to Australia, New Zealand, and the Pacific Islands. In August, two thirds (63%) were anticipating a restart to this region between the second quarter and third quarter of next year.
- Canada: The majority of respondents at 60% anticipate resuming operations in Canada in the second quarter of 2021, showing a 22% increase for Q2 2021 from the August survey. Of that 60%, a quarter (28%) specifically noted May 2021.
- Central America: Roughly a quarter (29%) of respondents anticipate a second quarter 2021 return to the region, while another quarter (23%) are planning to resume travel in Central America in the first quarter of 2021. Last survey, half (52%) were looking at restarting operations in Central America in the first quarter.
- Europe: Half (50%) of members anticipate returning to Europe in the second quarter of next year, a third (33%) of which specifically said April 2021. In August, the first quarter of 2021 was the most selected response at 38%, reinforcing another cautiously optimistic shift to second quarter 2021.
- Mexico: A quarter (24%) of respondents anticipate a second quarter return to Mexico, while another 19% project a first quarter 2021 operational restart. A third (32%) of respondents in the August survey were projecting a first quarter 2021 return to the region, a 13% decrease in optimism for a beginning of 2021 restart.
- Middle East: First quarter 2021 was the most selected response for resuming operations in the Middle East by a third (33%) of Active Members.
- South America: Roughly a third (30%) of survey respondents anticipate resuming operations in South America in the second quarter of 2021; while another 29% project a third-quarter 2021 return. In the previous survey, almost half (44%) of the responding Active Members were anticipating the first quarter of 2021.
- United States: The United States has come back first with 20% of Active Members who have already started operating domestically at the time of the survey, while another quarter (28%) plan to be operating in the US by the end of the year.
This survey was completed on October 29, 2020. Tour operators responding resemble the following break-down of travel services: escorted/guided tours 71%; FIT packages 57%; custom packages 53%; student travel 18%; and cruises 41%.
