International travel prospects remain distant due to Covid-19 restrictions. Domestic tourism is much more of a likely prospect and the popularity of rural areas that are close to home will pave the way for short-term tourism recovery.
Travellers may be more attracted to the comfort, low cost and additional privacy of a vacation rental over a hotel. Across China, Europe and the US there have been notable signs of an increase in domestic bookings for rentals, suggesting that this may be the norm for the short-term.
While this change in preference may not last, it is clear that there will be undeniable changes in the travel landscape and competition will be even more intense. This is where major OTA’s that service a wide range of consumer segments are again at a greater competitive advantage to service the changing needs of travellers.
Vacation rentals platforms first to notice recovery
Identified as the place where Covid-19 originated, companies and operators are now looking to China for inspiration as the nation’s lodging industry begins to accommodate a ‘new normal’.
Vacation rentals were one of the first firms of accommodation to notice an uptick in bookings. Airbnb users in China made twice as many reservations in April as they did in March and around 60% were placed around 200 miles away from where a guest lived. CEO Brian Chesky also announced that there has recently been a surge in domestic bookings in Denmark and the Netherlands as lockdown restrictions ease within these areas.
After announcing Q1 results, Peter Kern CEO of Expedia Group noted that Vrbo, its vacation rental brand, is one of the first to see an increase in bookings for May 2020.
While this increase will not likely rival previous revenues, it does offer some light on how future travel trends may pan out and what kind of players may be at the forefront.
Greater rivalry in future travel space
44% of global travellers booked with an OTA in 2019, while 36% booked through a lodging provider and 29% booked with an accommodation sharing site according to GlobalData’s global consumer survey (Q3 2019).
After the stringent procedures put in place worldwide to combat Covid-19, it is undeniable that there will be changes in the travel landscape. Competition will, without doubt, be intensified after this crisis as all companies fight for survival, but it remains likely that vacation rental and domestic providers may be the first to recover.