This week’s topic involves the leisure travel industry. The travel industry as a whole has seen better days, but recently there has been an incremental rise. The reason why people have not bee leisure traveling is because of money. Instead of traveling they have been looking for leisure activities around their own cities. Leisure traveling costs a good deal of money and everyone is doing whatever he or she can to save at this time.
In the Reuters article, “Leisure Travel is Recovering, But Slowly” Helen Chernikoff writes that the leisure business is slowly starting to improve, but is not completely back to its normal state. Chernikoff states that leisure reservations went up 23% in May of 2010. That is a big number for 2010 considering there was barely any leisure travel at all. She also claims that corporate reservations also went up 40% in May. So as you can see the business travel industry is still doing better than leisure.
The reason why the business travel industry is currently more successful than the leisure travel industry is because no matter what the price most businesses will fork over the money for business travel in hopes that the negotiations made on the trip will bring them more money. The companies are also paying for the travel, so the money is not coming straight from people’s pockets.
According to Pegasus Solutions Inc. the monthly profits made from leisure hotel reservations through June 2011 will increase a standard of 14% from the previous year.
Corporate travel is still on the rise, the amount of travel will raise 59% over the same time period that leisure travel.
Leisure travelers are also staying at cheaper hotels than corporate travelers. The corporations are putting their employees up at expensive corporate hotels, where the leisure travelers are staying in budget hotels so they can save their money.
The increase in demand of reservations will increase the room rates. So a heads up to those leisure travelers, try to stay away from corporate hotels and to fund the better deal, stick to the budget hotels.
It is good to see that the leisure travel industry is starting to increase. The company that I want to launch revolves around leisure travel and will want to promote people to travel. Hopefully the travel industry will return to normal or become better than it ever was in the next two years so that my company will be able to thrive.
http://www.reuters.com/article/idUSN2025332620110120
Great insight about Travel Industry Economics. I like that you pointed out that people are not traveling as far, and instead staying closer to home for small vacations and leisure. This can be great for local tourism, but bad for attractions that rely on large amounts of tourists from out of the area.
ReplyDeletePeople are learning how to be more economical when they travel, and how to get the best bang for your buck. That explains the popularity of travel deal websites.
Ultimately, it all depends upon two main factors: disposable income and the cost of travel.
Keep up the great insight!