The team at Air Canada Vacations, every year, has always made a point of telling travel advisors to book early to avoid disappointment.
“But if there’s a year [travel agents] need to pay attention, it’s this one,” Nino Montagnese, vice-president of Air Canada Vacations (ACV), told PAX in a recent interview. “They need to get customers booking or they’ll end up with a product they don’t want…or no product at all.”
Mr. Montagnese isn’t kidding around. After more than a year of border restrictions and COVID-19 lockdowns, and as vaccination rates increase, the public’s enthusiasm for future travel is heating up.
At ACV, several signs indicate that a vacation boom is coming. In fact, the boom is already happening to some degree – far sooner than anyone anticipated.
Canada’s sped-up vaccination campaign, as it administers sooner-than-expected second doses into more eligible arms, has not only given consumers a boost in COVID-19 immunity, but also a boost in confidence to start booking travel again.
“We knew the pent-up demand was there,” Montagnese said. “But we didn’t think it would get this busy until at least August.”
But here we are in June and ACV’s call centre is already lighting up, employees have been brought back and departments are busy loading products and updating prices.
It’s a scaled-down version of what business was pre-pandemic, but it’s still very good news, nonetheless.
For travel advisors, the dream of working again, especially as Canada prepares to relax its quarantine rules for fully vaccinated citizens, is finally within reach after months of uncertainty.
But to Montagnese’s point, it’s the early bird that gets the worm in this climate.
Even if some Canadians are warming up to the idea of boarding a plane again, there’s no guarantee they’ll get the vacation they want if they spend these next few weeks humming and hawing about it.
“Product is becoming scarce because everyone in the U.S. had a head start,” Montagnese said, alluding to how Americans, months ago, eagerly returned to the skies as U.S. vaccination rates soared and travel restrictions began to ease.
The U.S. market, simply put, is gobbling up the inventory.
“We’re starting to get stop sells on certain hotels over the peak periods,” Montagnese revealed.
Which leads to Montagnese’s number one tip for Canadian travel advisors right now: “Don’t be afraid to reach out and encourage travellers to book.”
Never-before-seen prices, promos and flexible booking options certainly sweeten the deal, but for agents, it comes down to getting their customers the type of vacation they want, he said.
“People are willing to spend money"
But what do consumers want right now, exactly?
ACV’s recent spike in sales (which, by the way, is being generated almost entirely by travel advisors, Montagnese noted) is reflective of some key mid-pandemic booking trends.
For starters, “People are willing to spend money,” Montagnese said.
This is where the popular term “revenge travel” factors in – the idea that consumers will take “revenge” on their inability to travel during the pandemic and spend more on bigger, longer, more lavish trips when they’re able to.
ACV's sales are a testament to this. “People are booking high-end product,” Montagnese said.
While COVID-19 has certainly disrupted the economy, causing financial hardship for many, not all sectors have faced the same levels of devastation.
According to figures released by the Canadian Imperial Bank of Commerce in November 2020, Canadian families and businesses have been hoarding money during the coronavirus crisis and are sitting on at least $170 billion in excess funds.
“People haven’t been able to buy clothes or dine at restaurants and they’re sitting on money they haven’t spent,” Montagnese said.
And for many, this is translating into a go-big-or-go-home attitude when it comes to booking future travel
“Now that people can go away, they’re saying, ‘I’m not booking a standard room. I’m booking a suite,’” Montagnese explained.
Which leads to Montagnese’s second big tip for travel advisors: “Don’t be afraid to upsell.”
Sandals, for example, “is flying off the shelves."
“We always considered Sandals as higher end, and it costs money to go there, but people are booking it up,” he said.
"Core sun is on fire"
Seeing Americans resume travel has likely triggered some of the demand in Canada, Montagnese suggested.
But Ottawa’s plan to allow fully vaccinated Canadians and permanent residents to skip their hotel stopover and 14-day quarantine will be the real game-changer.
Montagnese called the update, unveiled by federal officials last week, “very encouraging for our industry.”
“Hopefully, together with our partners, we can now rebuild our industry,” he said. “Canadians want to travel and this now brings us one step closer.”
According to the airline’s website, flights from Toronto and Montreal to Cancun and Punta Cana, for example, are set to resume on June 26.
A return to other hot spots like Cayo Coco, Varadero and Nassau (July 3) and Montego Bay (July 4) are also slotted in.
“The core sun is what’s on fire,” Montagnese said, citing a high demand for tropical destinations during the warmer months, from June all the way into fall.
Select U.S. destinations are making a comeback too. Las Vegas, for example, was barely selling three weeks ago, but it is now, Montagnese said.
“Vegas is a quick getaway. That’s what people want – that quick escape to get a fix of something,” he said.
The interesting part, here, is that most of these bookings occurred prior to Ottawa’s announcement about relaxing the rules for fully-vaxxed individuals, which is set to kick in next month.
People booked knowing they may still have to quarantine in a hotel upon returning, which speaks volumes to the market’s growing confidence in travel.
Group business, too, is “trending way up,” Montagnese said, noting how multi-generational leisure groups (family and friend reunions) are leading the charge.
Will Canada’s yet-to-be-announced vaccine certificate system disrupt future sales? Montagnese doesn’t think so.
“It will give customers peace of mind knowing that others on their flight have been vaccinated,” he said. “I think, in the short term, [proof of vaccination] will be necessary.”
As for Europe, the anticipation was that sales would pick up at the end of summer – “and that’s exactly what’s happening,” Montagnese said.
Supported by a 2021-2022 Europe Collection that debuted on a new, immersive digital platform, ACV’s bookings for Greece, Italy and Spain are all starting to roll in for late August, September and October, he said.
Looking back on the past 15 months, from Air Canada launching its industry-leading CleanCare+ program to operating a skeleton schedule of sun flights during fall and winter, Montagnese said he wouldn’t have done anything differently.
“From the beginning, we said, ‘If we don’t try, then travel is never going to start,’” he said.
It hasn’t been a straightforward journey – it was only last April that Air Canada, after securing $5.9B in federal aid, was able to begin refunding customers for cancelled travel during the pandemic and protect agent commissions at the same time.
“We adapted as much as possible, using suggestions that came directly from trade partners,” Montagnese said. “I hope [agents] see the work that ACV has done in building that strong relationship with them. I hope they know we’ve got their backs when they need it.”
Last week, Air Canada said it would be extending the deadline of its COVID-19 refund policy by 30 days to July 12, 2021.
In a statement, Lucie Guillemette, executive vice-president and chief commercial officer at Air Canada, said the number of customers who have requested a refund is actually “lower than anticipated.”
“Most have kept their travel credit, Air Canada Travel Voucher or Aeroplan points,” Guillemette said, “which we are pleased to see as it is an indication they plan on travelling in the future.”
This bodes well for getting customers in the air again, and as the inquires start to roll in, Montagnese encourages the trade to remember their worth.
“If there’s one thing the pandemic did for consumers, it showed them how valuable a travel consultant is – especially when it came to dealing with hotels and airlines directly,” he said.
“Agents are worth a lot.”
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