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Five Reasons to Travel Now

SmarterTravel

For the majority of us, travel is the quintessential discretionary expenditure—nice, yes, but necessary? No. And in a recession, it is just such non-essential spending that tends to be at the top of consumers’ not-to-do lists.

As a result, sales of everything travel-related have fallen off a cliff.

Delta, now the country’s largest airline, carried just under 1.5 million fewer travelers in February 2009 than during the same period a year ago, an 11.4 percent decrease. And Southwest flew 676,582 fewer passengers during February 2009, a 6.2 percent drop from February 2008.

While many airlines have been shedding flights, the capacity cuts have not kept pace with the falloff in demand. So there are more empty seats now, and will be for the foreseeable future.

The numbers are similarly grim for the hotels.

Marriott, in its 2008 annual report, predicted that revenue-per-available-room—a key indicator of consumer demand—will fall 17 percent at its North American properties, and 15 percent outside North America, during the first quarter of 2009.

InterContinental Hotels Group, which operates InterContinental, Crowne Plaza, and Holiday Inn hotels among others, just reported that its revenue-per-available-room dropped about 12 percent in January.

Airlines, hotels, rental car companies, and most other businesses associated with them are desperate for customers. And that desperation translates into better deals for consumers.

Bottom line: It’s a buyer’s market.

1. Deals, Deals, Deals

When travel demand declines, travel suppliers discount. Airfares, hotel rates, theme park entrance fees, cruise prices—the sale signs are everywhere.

A recent analysis of airfares by the Houston Chronicle found that domestic ticket prices were down 14 percent year over year, according to Harrell Associates. And some international fares had fallen even further: “Ticket prices to European mainstays London, Paris, and Rome are down about 35 percent from peak levels.”

The country’s major theme parks—including Disneyland and Disney World, both Universal Studios locations, SeaWorld, and Busch Gardens—are all aggressively dealing. At Disney World, seven nights at any of the park’s hotels are on sale for the price of four through March 29, including tickets to the park and, during especially slow periods, a $100 gift card.

Swissotel is offering 20 percent off the best available rate for stays of two nights through May 31. Uber-hip W Hotels is giving away the third night, after two paid nights, through September 30. And at the other end of the price spectrum, Country Inns and Suites is taking 33 percent off each night of three-night stays—effectively a third night free—through April 30.

2. Miles, Miles, Miles

The complement to recession pricing is frequent traveler program promotions.

The airlines are playing the empty-seat scenario two ways. First, they’re offering bonus frequent flyer miles for travel on the weakest routes. American, for example, currently has extra-mile promotions in place for travel to Japan, the U.K., Madrid, Moscow, Latin America, Hong Kong, and Shanghai.

Second, they’re making it easier for program members to redeem their miles for free seats. [% 2835063 | | United %] is offering award seats to Europe for 15,000 fewer miles, through May 14. And Qantas has increased international coach award seats by 50 percent, and added 1 million seats to its intra-Australia coach and business-class award inventory.

While other carriers haven’t followed Qantas in publicly proclaiming their newfound generosity, we know anecdotally that travelers are having an easier time booking award seats. After all, this is a rare opportunity for the airlines to get the mileage liability off their books, with little danger of displacing revenue passengers, and at the same time they can reverse the widespread perception that award seats are way too hard to come by.

Meanwhile, there have never been so many [% 2811432 | | bonus points on offer at so many hotels %]. By my count, there are currently bonus points and miles on offer from nine of the largest hotel chains, representing well over 20,000 individual hotels at every price point, in every corner of the world.

3. Space, Space, Space

Where there was once a seething mass of humanity, there is now … space.

At airport parking lots, there are open spaces on the ground floor. Airports are curiously serene. At security screening checkpoints; in airport lounges; at the baggage claim carousels; at airport taxi and van stands—everywhere there are fewer people, shorter lines, less frustration.

The flights experience itself benefits as well. The overhead luggage bins suddenly seem oversized; there are plenty of empty middle seats; and there’s no line for the lavatory, even after the movie.

In addition to the easing of the crush and claustrophobia associated with travel, consumers should enjoy a noticeably more welcoming attitude from travel providers. With fewer customers to service, front line employees are under less workload pressure. And they’re grateful for the patronage of those still traveling.

4. Dollars, Dollars, Dollars

Remember when U.S. travelers would return from overseas trips complaining that the once-almighty American dollar was worth just pennies when converted to foreign currencies? It turns out that in tough times, the relative dependability of the U.S. economy gives the dollar a lift. As a result, the Yankee dollar is again kicking currency butt.

Headed for the U.K.? There, on March 6, your dollar would buy £0.71, up a hefty 40.3 percent from last year’s £0.50.

Across the English Channel, the dollar has increased in value by 20.9 percent, exchangeable for €0.79, versus €0.66 a year ago.

Elsewhere, the dollar buys 70.5 percent more Icelandic krona than it did a year ago, 42.4 percent more Brazilian reals, 29 percent more Canadian dollars, and 28.6 more Indian rupees.

The dollar’s revival isn’t universal, however. It’s down 3.8 percent against the Chinese yuan, and off 4.4 percent against the Japanese yen.

5. The Stimulus Is Us

If a spike in value and comfort isn’t enough to trigger a resurgence in travel, perhaps an extra dash of patriotism will nudge staycationers into overcoming their stay-at-home inertia.

Behind all the convoluted economic stimulus plans lies a simple fact: Consumer spending is the key determinant of the economy’s health. And even with unemployment exceeding 8 percent, as it did in February, there are still many people with the financial wherewithal to travel.

If they—we—were to open their wallets and spend again on trips, travel would rebound, and could even lead the economy into recovery.

With that in mind, the travel industry would do well to appropriate for itself a recent political campaign slogan: Yes we can. And for many reasons—ranging from patriotism to self-interest—we consumers should do our part by endorsing that agenda.

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