While domestic tourism is showing a steady recovery, spending in a number of tourism expenditure categories is yet to recover to pre-pandemic levels.
Adding to this, various economic factors caused shrinkage in share of wallet on non-essential expenditure such as travel. Despite this, there is a strong need in the market for travel as a means of dealing with the effects of Covid-19 fatigue.
Below we uncover the current local trends
and their impact on domestic travel.
The impact of living
in a pandemic and the
ever-changing lockdown
restrictions have created
another looming pandemic:
compromised mental health.
To mitigate this, people
are opting to travel for
emotional reconnection
and reconnecting to
nature by spending time
in the outdoors and
wide-open spaces.
Travelling to Visit Friends and Relatives (VFR) and reconnect with loved ones will become important for consumers.
The need for connecting with family and friends aligns with the trend that consumers see this as a form of self-care to deal with Covid-19 fatigue.
And in response to time spent alone at home, there will be a renewed interest in nature and outdoor activities where they can socialise and spend time with family.
VFR travel accounts for the largest number of domestic trips
Most domestic travellers are between the ages of 18 - 34 years
Socialising with family and friends is the most popular activity for VFR travellers
The price of petrol in SA has increased exponentially over the last few years, the increase could result in double-digit inflation until March 2022*.
There has been a 25% increase in petrol prices pre-pandemic to now. Transport is the biggest expenditure item for domestic travellers and thus petrol prices will affect their trip spend
High petrol prices negatively impacted travel costs (fuel, flights, minibus taxi fares).
Increase also inadvertently resulted in a rise of the cost of general goods.
As travel is non-essential and with budget constraints, consumers will reconsider travel. As the focus for consumers will be to cover basic needs first.
According to StatsSA, Unemployment rate in South Africa significantly increased in 2021 and a quarter-by-quarter comparison indicates 584 000 lost their jobs between Q1 and Q2 of 2021.
There are 7,8 million people that are unemployed in South Africa
An increase in unemployment leads to a shrinkage in the number of domestic tourists that can afford domestic travel.
As a result, individuals that are employed, are now financially responsible for more people in the household and family.
With disposable income decreasing, it becomes necessary to cut back on non-essential expenditure to accommodate their constrained wallets
As the consumers are looking for wide-open spaces, travel trade needs to meet the consumers needs by packaging these experiences.
With budget constraints comes a more price conscious consumer. Trade needs to be aware of the constraints and adjust package prices and offering accordingly.
Giving travellers clear COVID-19 information gives them the confidence to book and assures them of their safety during the trip.
Travel starts from home, there is an opportunity to encourage consumers to enjoy local tourism experiences and re-grow their community’s economy from the ground up.
Sources: * BusinessTech *CNBC Africa
