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Ypartnership: Travel Industry Must Deliver Value, Consumer Demand FlatNovember 30, 2009 By: George Dooley
An estimated 53 percent of all U.S. households are planning at least one leisure trip between now and April 2010, down slightly from the 56 percent who stated the same intention in October 2008, according to the results of the Ypartnerships most recent travelhorizons survey.
The October 2009 survey (which is co-authored every 90 days with the U.S. Travel Association and evaluates demand over the next six months) suggests that the travel industry is not out of the woods yet and that value will be in vogue once again, Peter Yesawich, CEO of the Ypartnership reports.
"Without question, 2009 has been a year of considerable challenge for practically every travel service provider," Yesawich said. "So, as the year comes to a close, our thoughts turn to the year ahead with the hope that market conditions will improve. And for some in the industry, just "stabilize" would come as welcomed relief."
Concerns about "the household budget" remain the primary deterrent to future leisure travel (cited by 39 percent of those not planning a trip), yet the incidence of this concern is now at the lowest level Ypartnership has observed since it began to include the question in the survey, Yesawich reports. "The most significant decline in expected trips is among younger members of our population (Gen X and Gen Y), while the incidence of leisure trips taken by Boomers is expected to increase," he said. "On an even more positive note, among those planning to travel, the expected average number of leisure trips that will be taken during the next six months is up to 3.0 from 2.8 in October 2008."
The outlook for business travel remains mixed, with only 18 percent of adults planning at least one business trip (including to attend business meetings and conventions) between now and April of 2010, essentially unchanged from the number we recorded last July (17 percent). Expectations with respect to the average number of business trips provide some encouragement, however, as this number has increased steadily throughout the year, rising from an average of 3.3 in April to 4.8 in October. This average is being driven up by a relatively small percentage of the overall population of business travelers though: only 6 percent intend to take "more business trips" during the next six months (24 percent expect to take "fewer").
"The overall Traveler Sentiment Index (a derivative of six different variables measured in the survey) suggests that demand for travel services is likely to remain flat during the next six months," Yesawich said. "Among the six variables from which the Index is derived, only one is currently moving in a positive direction: 'personal finances available for travel.' The other five variables have declined from the levels recorded in July 2009, with the expected 'quality of travel services,' 'affordability of travel,' and 'time available for travel' declining most.
"In summary, the horizon line for the next six months doesn’t reveal any significant change in the complexion of demand for travel services," Yesawich continued. "Demand for leisure travel services will continue to fill the majority of occupied seats and rooms, with demand for business travel services remaining essentially flat. And lingering concerns about household finances underscore the need for all travel service marketers to insure they continue to offer good value in order to capture their fair share."