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ALTOUR Index Reports Industry RecoveryJune 2, 2010 By: Kirk Cassels
On the heels of a PhoCusWright report that says the travel industry is experiencing sustained recovery at best, respondents to ALTOUR 's May 2010 ALTOUR Index say otherwise.
Unlike many travelers who experienced nightmares during the Iceland volcano incident, concerns over volcanic ash ultimately had little impact on ALTOUR clients’ travel plans. Europe regained its spot as the top destination of choice among repondents (85 percent), buoyed perhaps by the weakened Euro, after a brief dethroning by the Caribbean in the February survey. And while the majority of travel continues to be booked 30 to 90 days in advance, as it has since the first survey was conducted in June 2008, some agents are seeing an increase in longer-range bookings over the past six months as travelers gain confidence.
“It does seem that, in general, more clients are more comfortable traveling farther from home this year,” Susanne Knowles of Carmel, IN, said. “And I am confirming travel much farther into the future these days. I have several trips scheduled for 2011, and have already received an inquiry for 2012.”
Recovery is also reflected in a sharp drop in cancelled bookings. As many as 43 percent of agents report no cancellations this month compared to 26 percent in May 2009. Those experiencing fewer than five cancellations are up from 32 percent to 40 percent, while those reporting more than five have dropped from 42 percent to 17 percent.
In the cruise market, the tide has clearly turned, with demand growing in all categories. The premium segment is enjoying the sharpest recovery, with 44 percent of ALTOUR agents reporting high demand compared to just 17 percent in May 2009.
On land, FIT demand has risen from 21 percent to 52 percent compared to last May, surpassing the previous leader, all-inclusive resorts, which posted a more modest gain, from 26 percent to 29 percent. While escorted tours remain the least popular of the land markets, they are now squarely on the radar. As many as 20 percent of agents are now reporting high demand for escorted tours vs. none in May 2009.
Jane Antonacci of Paramus, NJ, attributes the new interest in escorted tours, at least in part, to security. “I think clients who travel overseas feel safer to travel as a group, rather than on their own,” she said. “I have booked a few escorted tours this year to destinations that would have normally been FIT trips.” It may also be an issue of value, say other agents, especially in the face of rising fuel prices, which, along with dining and tour inclusions can make traveling in a group more cost-effective.
Security is particularly an issue as more travelers head to exotic destinations such as China, which, for the first time, shares the #1 spot among emerging markets with perennial favorite South America (both at 39 percent). Egypt rose from third place to second (36 percent), while Eastern Europe has dropped from second to third (32 percent).