People’s attitudes and behaviours have shifted during months of lockdown and now over a year of a pandemic, and these changes are likely to continue for some time. But what are the implications of these changes for the travel industry? University of Melbourne consumer psychologist Dr Brent Coker noted that when an industry “wakes up again, what tends to happen is that all the brands start scrambling for the consumers”, leading to price competition.
Speaking at the Jan-2021 edition of CAPA Live – a monthly virtual summit, offering insights, information, data and live interviews with airline CEOs and industry executives across a next-gen virtual event platform – Dr Coker said: “It’s the opposite of marketing, where we want to build our services and our offerings and our value based on premium-ness, so that we can extract more profit out of consumers. Then, in the long term, we start focussing on loyalty”.
In his presentation he acknowledged that during the Great Depression, “we saw a whole generation of penny pinchers” noting that it is “likely we might see this again with the so called ‘COVID’ generation”. He added: “We will likely see what we call a rubber band effect’ towards consumption.
There is also a recognition that returning consumers will be more concerned about their health, hygiene during travel and also more aware of the environmental impact of their journey. Sustainability will become even more important in this emerging world.
Dr Coker explained that Generation Z “care about the environment more than any other generation,” with 73% of Gen Z individuals “willing to buy a new product if the brand supports a good cause”. Dr Coker also noted consumers are “increasingly starting to blame brands, or look to brands, in terms of how they’re impacting environmental decisions,” plus how they can assist the conditions. This, he said, means that carbon offsetting should be incorporated into airline marketing, “given we know that features like this strongly affect consumer demand and purchase decision making”.
You can learn more of Dr Brent Coker’s thoughts in his full CAPA Live presentation: