Is group travel dead? My answer: yes and no! Group travel in its most traditional sense – loading 50 seniors on a bus and carting them around for several days on a sightseeing tour with stops for dining and maybe a show - is slowly going away. It is being replaced by smaller, more active groups with varied interests seeking flexible travel options. In short, the future of group travel is bright, and it is evolving in many positive ways that opens up new opportunities for the industry. I recently attended National Travel Association Travel Exchange (NTA TREX), where I interviewed 20 tour and travel leaders on the future of group travel. Three BIG themes emerged from those conversations. Here are the group travel trends we are tracking:
1. Changing Group Dynamics
It used to be that if your business or attraction could not accommodate at least 50 people all at the same time, you were not a fit for the group travel industry. That old way of doing business in a thing of the past. In the post-pandemic world of group travel, the way we think about a group has been forever changed. Travelers prefer smaller groups, and they are willing to pay a higher price for a bus that is half full allowing for more personal space and an intimate experience. They seek more relaxed and slower-paced itineraries that focus on deeper experiences with fewer destinations per trip.
Implications for businesses & attractions
Think about the varying sizes of groups you want to attract and structure your price discounts accordingly. A smaller group may purchase more of your products because they will have more time to spend in your shop. They are also more likely to tell their friends and promote return visitation when they have a deeper connection.
Businesses and attractions working with smaller groups should consider the needs of the tour operator that is packaging your product. The tour operator is marketing your business for you, and they need to make a margin on the sale. Gone are the days of offering group discounts on groups of 35-50. To truly gain the benefits of this lucrative market, your tour partners require group discounts even if the group size is 12, 20 or 30 people. One way to enhance your offering and charge a little more is to add on unique experiences that a traveler cannot buy directly. This will give the tour operator a competitive edge in marketing your business as part of their package.
Group demographics and behaviors are evolving
The shorter booking window trend for leisure travel is also one of the group travel trends we're tracking. Consumers are waiting longer to decide, they are booking trips later and are more tech savvy, doing a lot of research before finalizing plans. One way tour operators are managing this is through travel insurance. Insurance has seen a sharp rise in sales over the last few years and brings peace of mind to bookers.
Once thought of as only catering to retired senior citizens, the group tour industry is quickly changing to attract a wider variety of travelers. Programs with more choices and freestyle itineraries attract a younger customer who loves to have someone else do all the trip planning. A sharp rise in women travelers is driving destinations to rethink their group offerings to appeal to this niche group. This market requires different room configurations - think singles instead of double doubles. They also look for unique experiences that appeal to a broad range of interests from women’s history to adventure to food and culinary. Another niche market that is picking up steam is the Black traveler who seeks Black culture, history, and experiences.
2. Group Travel Product Evolved
Tour operators are building programs to meet consumers' demand for off the beaten path and lesser-known destinations. Their active itineraries enable a group to arrive in a destination and split up to explore on their own. Itineraries and travel products include more outdoor activities, smaller towns, and out-of-the-ordinary, quirky places. Tour operators prioritize experiences travelers cannot get on their own to help attract new customers. Themed events and dinners are also very popular.
Implications for destinations big & small
This group travel trend is truly exciting for all destinations large and small. It's good news for big cities that want to spread the visitor economy around to their little-known neighborhoods. Travelers are focused on checking off bucket list items and a visit to a big city is still on the list. However, the experience has evolved beyond the main attractors. Groups want to go deeper into the culture and people of the area. This is a perfect opportunity to show off unique neighborhoods and the businesses within them.
Smaller destinations that may not have been able to attract travelers away from the better-known destinations are seeing a surge in interest from group tour operators. The rise in popularity of learning experiences provides an opportunity for small destinations to tap their local experts in new ways. From naturalists sharing a favorite hike to craftsmen, crafters and creators showing off their trade, programs that teach or offer hands-on demonstrations are becoming favorite additions to trips.
No matter the size of the destination, storytelling continues to be an important part of the trip. Think beyond the step-on guide or the experience itself. Younger travelers want to know more about the full array of what is happening at the destination. They are seeking interpretation of the natural surroundings and the stories behind them.
3. DMOs are Important Partners
Tour operators have gone from zero to one hundred overnight. With many bookings from 2020 being pushed years ahead, they are struggling to keep up with servicing rebooked business and managing new bookings from travelers who have pent-up demand. At the same time, tour operators are struggling with the same staff shortages and taxed resources as many of the businesses in hospitality and leisure. All this while trying to rebuild relationships with suppliers who have experienced their own staff turnover and are on a learning curve.
Collaboration is the key
The tour and travel industry has always been a collaborative effort between buyers, suppliers, and DMOs. In a post-pandemic world, DMOs have become an even more important partner in helping to rebuild and reimagine group travel. DMOs who kept their tour and travel departments intact throughout the pandemic are leaps and bounds ahead of destinations who had to pause their focus on this important travel segment. The DMO professionals who know the group tour market are jumping in to train new team members at hotels, restaurants, and attractions where tour operators visit because there is no one there to mentor them. They are educating stakeholders' new employees who were hired post-pandemic and do not understand the tour and travel market or why it is worth their time. Getting the destination ready to receive groups is an important step in rebuilding the market.
Given the high demand for dining and staff shortages, tour operators are struggling to find suitable meal stops. DMOs help solve this problem by seeking creative alternatives for dining such as privately-catered experiences or boxed meals to take to a park.
As the group travel product is evolving and the needs of the group tour are changing, DMOs are helping tour operators develop entire programs. They are curating experiences from food tours to meal and entertainment options. They are leading the way in developing new areas and off the beaten path product such as the Northern Lights of Canada. These are assets that can't accommodate a full bus, but work for smaller groups. DMOs are going above and beyond, acting as tour planners, being creative and working across city, county and state borders to create new product for tour operators.
Implications for DMOs
Destinations who are committed to the group travel industry will see new opportunities come their way as they double-down on being great partners to tour operators. DMOs who understand the importance of remaining flexible and continuing to change with the industry will be the leaders who help shape the future of group travel while bringing lucrative business to their communities.
The Future is Bright
At the close of each of my conversations, I asked tour and travel leaders to express their feelings about the industry, and here is what was shared: opportunity, excitement, passionate, friendly, awesome, exciting, partnership, invigorating, strong connections, ready, collaborative, family, energetic and one-stop shopping.
These words sum it up perfectly.