Are tourist dollars coming back any time soon?

Photo: @beachbumledford via Twenty20
Jun 11, 2020
Tom Ryan

Although most governments are still advising against “nonessential” international travel, tourist dollars may be heading to beaches, mountains and other nearby vacation spots this summer.

The appeal of local travel was highlighted by findings of an ongoing survey of 1,200 business or leisure travelers from the U.S. Travel Association. Results from the first week of May found:

  • Travelers continued to feel safest when traveling in personal cars, cited as safe by 68 percent. That compares to 18 percent for domestic flights and 11 percent for international flights.
  • Among leisure excursions, travelers feel safest visiting parks, cited by 40 percent, followed by beaches, 26 percent. Coming in lower among leisure activities were outdoor sporting events, 15 percent; outdoor concerts/festivals, 14 percent; indoor concerts/festivals, 12 percent; and movie theater, also 12 percent.

A more recent survey of 1,000 adults from Longwoods International, fielded June 3, found 69 percent of American travelers are changing their travel plans because of the pandemic, down from a peak of 85 percent on April 8 and the lowest level since mid-March. Also showing improvement from recent weeks, 44 percent would feel safe traveling outside their communities and the same percentage would feel safe dining in local restaurants and shopping at local stores.

That still leaves a lot of cautious travelers. Indeed, the U.S. Travel Association found travel spending for the week ending May 30 remained at about 20 percent of the average level seen in the weeks leading up to the pandemic.

Like retail, the tourist industry is hoping to take advantage of pent up demand, but many festivals and other large events that bring in tourists have been canceled or postponed at least until the fall.

Campgrounds and beaches are starting to open with restrictions. On June 10, Miami Beach reopened but visitors must limit group sizes, wear face-masks where six-feet guidelines are difficult to maintain and refrain from volleyball or Frisbee.

Some resort and beach communities are also concerned that crowds will spread the coronavirus. The Longwoods International survey found only 46 percent of Americans support opening their communities to visitors.

DISCUSSION QUESTIONS: Are stores and retail districts heavily dependent on tourist traffic facing a more challenging recovery phase than those reliant on spending by locals? What advice would you have for stores reliant on tourist dollars?

Please practice The RetailWire Golden Rule when submitting your comments.
"my advice for stores opening for tourists would be to make it clear what your COVID policies are, and enforce them, to protect your associates."
"Shopping vacations for the foreseeable future are over."
"It is going to be a tough summer."

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19 Comments on "Are tourist dollars coming back any time soon?"

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David Naumann

Tourism and any trip that depends on air travel will be curtailed this summer. I know many people, including my family, that have decided it wasn’t worth the risk or potential disappointment to book a vacation this summer. It isn’t as fun when not everything is open. This will certainly impact retailers that depend on tourism and it may be longer than we expected, as just yesterday, a Harvard health expert said he expects the US to surpass 200,000 deaths sometime in September. There isn’t a silver bullet for tourism retail. Finding a way to attract more online visitors is probably one of the best options.

Bob Phibbs

What we need to see in these next few weeks is no infection spike in tourist areas that opened in May. When that happens we’ll see a cautious public anxious to plan a July 4th celebration. The most important thing for those tourist destinations is not to assume the worst — assume people are looking to escape the news and you’re going to help them. That’s a combination of digital and social to keep in front of these weary cabin-fevered travelers. Those who are afraid won’t be traveling, no matter what you say. But those who do need you to show up as their best option.

Ken Morris

I believe that few folks will be flying this summer. But the staycation will widen its boundaries to include anywhere within a 4-12 hour car ride as people feel safe in their own automobile. Stores and restaurants need to cater to these semi-local patrons by offering goods and services that reflect the new base. In Florida that might mean dumping that German language menu and choices to aim local. In Maine it may mean the same with Québec French. Aiming local should be this summer theme.

Richard J. George, Ph.D.

No doubt, travel and vacations will be seriously impacted, at least in the short term. International travel will definitely be slow to return to any level of normalcy. However, Americans fatigued by shelter in place orders, will venture out sooner than later. Staycations and vacations close to home will be the dominant form of vacations for this summer.

That being said, stores and retail districts in home markets as well as in the destination markets need to revise their marketing strategies and product assortment accordingly. For example, camping equipment and beach accessories will be in demand. Guides to and viral programs of campgrounds, national parks, ocean beaches and lakes should be highlighted on retail websites. Now is the time to get close to their customers and creatively respond to their needs for a break from COVID-19.

Paula Rosenblum

Well, it’s not really a great time for tourists to come to Miami or other South Florida destinations, and I suspect the snowbirds have just returned to their tri-state area homes (as the virus winds down a bit up there, and does not down here). I have no interest in traveling at the moment, but I’m curious to see the blow-back from the protests. If there’s no huge spike, I might try to leave town for a while in August.

I think generally, there are some seriously over-stored areas, especially on the luxury side, and they may have some problems. I see South Florida continuing to do well. To put it in perspective, 85% of Bal Harbour Shops sales come from tourists, so I guess they’d better come back!

Ben Ball

The voices resisting visitors to their communities are not those of the local businesses dependent on tourism and will soon fade away. College spring breakers notwithstanding, tourists are just as likely to behave responsibly on the beach as they are in their own community at home. Tourist destinations need their dollars, and the nation needs a vacation!

Neil Saunders

In the medium term, I expect domestic tourism will pick up. That will help states like Florida and California. However, it will take much longer before international tourism gets back to anywhere near pre-coronavirus levels. That will have a very negative impact on big cities and tourist magnets in the US, with a consequent fall in revenues for tourist-focused retailers in those locations. Retail in airports — which had been growing strongly — will also feel the chilly winds of severely reduced demands.

Jason Goldberg

It’s going to be a tough time for vacation oriented businesses. We’re still in the early innings of COVID, and we’re just not going to see people getting on planes in the numbers we are used to for at least 18-24 months.

At the same time, people are running out of endurance to shelter in place and are going to seek new activities and venues.

That creates the opportunity to embrace the vacation activities that consumers are doing. Car vacations are the new luxury. Airbnb is coming back, and with most customers booking a location less than 200 miles from their home. RV rentals are very high.

Laura Davis-Taylor
Well, we are all guessing here. But I can offer a view from hot tourist spot Daytona Beach. I arrived about 10 days ago to nest with family for a bit and saw every beach hotel on a 20 drive minute stretch full to capacity. The streets were packed, the beaches were packed, the pools were packed and the bars and restaurants did not seem slightly off kilter. On the beach side, most employees were/are wearing face masks and posting signs to be mindful of social distancing. I see very little enforcement, however. Frankly, it was—and is—concerning, as the state’s numbers are hardly going down. Net-net, if what I’m seeing is an indicator, tourist-driven business in spots easy to drive to are getting right back into the swing of things, cautionary procedures more a box check than a true concern. The locals will theorize that, when in the outdoor heat, pools/water and chlorine, there’s a lot less to be concerned about. How this theory as well as similar behavior is going to pan out, however,… Read more »
Paula Rosenblum

I’m not defending anything, but Florida’s numbers are simply weird. 1/2 of new cases have come out of Miami-Dade and Broward counties, both of which were completely closed up until this past Monday. So the whole thing is very confusing.

I have a friend who lives in New Smyrna Beach and she reports a real lack of social distancing … she stays home, mostly.

But I wish the numbers here were able to be rationalized. I think we’ll know a lot in a couple of weeks. The protests were clearly not socially distanced events.

Cathy Hotka

I traveled recently. Many of my fellow travelers were, shall we say, casual about their use of masks. Some boarded the plane and promptly removed their masks. Little social distancing. I guess my advice for stores opening for tourists would be to make it clear what your COVID policies are, and enforce them, to protect your associates.

Ralph Jacobson

In the U.S. where COVID-19 restrictions have been relaxed, people are flocking to leisure areas en masse (beaches, amusement parks, casinos, etc.). Airlines have been booked solid in the past few weeks, which is really surprising me. I would have guesses that plane would have been the last place to return to normal. However, as opposed to empty planes a month ago, it’s hard to find a seat these days. International travel is only the next step. Sure, certain areas are still hot spots and others still haven’t peaked in their COVID-19 infections. However, the overriding trend that is showing everywhere is that you can’t keep people locked up forever. As restrictions get relaxed, tourist dollars will continue to flow.

Ricardo Belmar

Tourist locations may see a mixed result in the coming months. As other have noted here, the tourist mix will be different than previous years. Less international travelers, feet tourists from remote locations, and many more within driving distance of the venue.

It’s clear that many people are reaching their limits on sheltering at home as the weather warms up and the traditional summer vacation season begins. Retailers may see different tastes and purchasing trends as a result as many of the vacationers that visit them will be coming from different destinations than before. I’d say retailers should take a cautious, but optimistic approach and be clear about any COVID-19 related policies in place. Of course, those policies will only matter if they are followed and enforced. No reason to assume that the tourists that come calling are those that don’t believe in safety — they’re just looking to enjoy some time away from home in as safe a manner as possible.

Mel Kleiman

Just read this morning report on increases in COVID-19. With warmer weather and the relaxation of rules related to social contact, the number of COVID-19 cases is skyrocketing. This increase is going to be another significant blow to everyone and everything related to the leisure market, retail, travel, restaurant, and lodging. It is going to be a tough summer.

Brandon Rael

We are seeing a conservative and cautious return to normalcy. As long as we follow common sense, social distancing, and keep our awareness on the latest COVID-19 development, people will want to take weekend getaways. However, we should expect that people will continue to be cautious about getting on the plane, until there is a sense of comfort, safety, and security, especially with all the unknowns about the virus.

So, they will come back, just not to the levels of the recent past. This pandemic will continue to be quite disruptive on international destinations, while the drivable vacation spots will see a pickup. Tourist dependent businesses and towns should plan accordingly and remain resilient. This too shall pass, and the growth cycles along with increased consumer demand will return.

Paco Underhill

Shopping vacations for the foreseeable future are over. London, Paris, New York, Dubai, with air travel curtailed, have seen severe drop offs. In the face of economic and social change spending money is more guarded. Retail around road trip destinations will pick up, but AirB&B and Vrbo are failing based on cleaning perceptions.

Craig Sundstrom

So “only” 32% don’t feel safe … in their own car: whoopee! Ok, let’s not fixate on a single survey from months ago: sentiments are fluid and will almost certainly improve over time. That having been said, it’s hard to imagine an industry being hit harder than tourism (and note: “hit hard” isn’t the same as “entirely disappear,” so there’s little point in claiming things will be fine because half of the usual number of people are willing to do something). And what about the many areas — NYC, Los Angeles — that are heavily dependent upon international tourism? They’ve been among the hardest hit by the virus, and whatever reluctance someone has about hopping on a plane for 6-8 hours would seem to be compounded when the risk doesn’t end once they land. Will domestic visitors make up for it? That’s a lot to ask … even in good times.

Mike Osorio

Tourism, both domestic and especially international, drives a significant percentage of retail and ancillary business in much of the country. Where I am in Hawaii, it is an overwhelming driver of retail and the overall economy. It is naive to think local traffic will provide the traffic and spending necessary to resuscitate retail performance outside of the few that provide essentials. This is a time for retailers to focus on shoring up their balance sheets, while continuing to engage with their online and few in-store visitors. Tourism must return to 80-90% of pre-COVID levels. That probably won’t happen for a year or more, assuming there is a vaccine, and the overly-leveraged and mediocre retailers and brands will not be here when that day comes.

Shep Hyken

People want to get back to normal, and that includes travel, dining and shopping. While some people are ready to do all of that, there are still huge numbers of people who aren’t ready. And, nobody can predict with any accuracy if the there will be another run of COVID-19. There is still too much that is unknown.

Advice? Hope for the best and prepare for the worst. Be ready if we have a relapse in the economy. Celebrate and embrace any good that comes in the future.

"my advice for stores opening for tourists would be to make it clear what your COVID policies are, and enforce them, to protect your associates."
"Shopping vacations for the foreseeable future are over."
"It is going to be a tough summer."

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