The Future of Travel and Tourism After the COVID-19 Pandemic And Implications for Hawaiʻi

UHERO BRIEFS ARE CIRCULATED TO STIMULATE DISCUSSION AND CRITICAL COMMENT. THE VIEWS EXPRESSED ARE THOSE OF THE INDIVIDUAL AUTHORS. WHILE BRIEFS BENEFIT FROM ACTIVE UHERO DISCUSSION, THEY HAVE NOT UNDERGONE FORMAL ACADEMIC PEER REVIEW.

% Change Air Passengers 2020 v 2019

Shortly after the start of the coronavirus epidemic in the U.S., CNN Business ran a story with the provocative headline: “The travel industry is suffering its worst shock since 9/11 because of coronavirus.” As the virus raced across the country though, COVID-19’s impact on the travel industry has turned out to be far worse than 9/11. The pandemic has turned 2020 into a lost year for the U.S. travel industry. In this essay we examine what the future of travel and tourism might look like primarily in the U.S. and future implications for Hawaii tourism. We focus on the potential long-lasting and systematic effects of the pandemic on travel and tourism rather than just the recovery. To read the entire essay, click on the following.

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6 thoughts on “The Future of Travel and Tourism After the COVID-19 Pandemic And Implications for Hawaiʻi”

  1. Many factors will cause the restart of tourism to Hawaii, the experience of being in the islands should be a prime driver, not price. This winter as the snow fall starts with millions of people having been restricted in one form or another for months at a time, with a reduction of the virus spread, a potential vaccine available many will be looking for a way and a place to go. Why not Hawaii? Tourism needs to return at some gradual pace since if tourism came back to pre-covid levels, our infrastructure and hospitality services would most likely leave a lot to be desired. Slow and steady with manageable tourism and manageable health services since covid will still be here for residents as well as tourist.

  2. Thanks for this great overview of tourism recently and future prospects.

    On tourist marketing, looking at the last paragraph of page seven, this echoes much popular sentiment that relies on an assumption that HTA is fairly impactful in tourism outcomes, no? But I’ve never seen a study of HTA’s effectiveness like, for example, a regression with HTA dollars spent or some IV for HTA strategy/productivity to measure the size and significance of the agency’s impact. Any idea if that exists?

    Re: the diversification efforts and your 2019 white paper recommendations, maybe I’m too Hayekian but aren’t these industrial policy without the name and thus will likely follow the same track record? Even ignoring the knowledge problem there, from a public choice perspective, what institutional incentives/structures have changed recently to think that HI has the state capacity to enact the three recs effectively?

    Mahalos for taking the time!

    1. Hi Laron:

      Re your question on the effectiveness of marketing expenditures. Alas, the answer is “No.” To the best of my knowledge, HTA hasn’t done any regression analyses of the impacts of tourism promotional spending on visitor spending. This is quite common not just in Hawaii but around the world. Have you seen my book “Developing a Dream Destination, Tourism and Tourism Policy Planning in Hawaii”, University of Hawaii Press, 2008, Chapter 5.

      Re your question on diversification efforts. There are at least 3 studies on going right now on economic diversification strategies in Hawaii. Sumner La Croix and I are working on a paper, some preliminary results were presented this week by Summer at the annual Hawaii Economic Association meeting. We hope to complete our paper soon and posted here. We will no doubt seen the results of the other two studies (hopefully) soon.

      Aloha

      Jim

      1. Thanks for the reply Jim. I haven’t seen your book but thanks for the rec, I’ll have to find it. Off topic but I gotta ask – in the decade since you wrote it, is there anything in there you’d change or revise if you wrote another edition?

        I only made it to the last few minutes of the panel with LaCroix at the HEA meeting so I must have missed the prelim results. I’m excited that this effort is being devoted to studying this issue though since it’s discussed so often. Does your study, or the other studies, address the knowledge problem and/or examine the industrial policy aspects of tourism management from a public choice/state capacity perspective? Or address points made by Seth Colby in his presentation for the HEA mtg (that followed LaCroix’s)?

    2. Aloha, Laron … and thank you for the comment. Getting a precise fix on return on marketing investment is very difficult using standard tools like regression. Part of the challenge is that there are so many variables that affect the results and many of them are beyond the control of the destination. Even when it comes to gauging the results of promotional activities, the “dirty little secret” of destination marketing is that the destination itself only accounts for a fraction of the total promotional spending. All that being said, there are two things to point you to in answer to your question. First, there is a “marketing effectiveness study” (which I actually commissioned back in 2003) that measures changes in attitudes both about Hawaii itself and for Hawaii relative to its competition. This is something that the destination’s marketing has a modicum of control over. The most recent report (2019) can be found on the HTA website at https://hawaiitourismauthority.org/media/4746/con-18177-marketing-effectiveness-wave-4-jul-dec-2019-external.pdf . The other comment that I would make is that the world of technology tools for marketing is changing dramatically in the age of big data and data analytics. We are seeing a future emerge where we can not only identify the high potential visitors (almost individually) but also track their behavior to see if they actually come to Hawaii (and what they spend). Singapore tourism has a chief technology officer. Maybe it’s time that we invest in that capability.

      1. Thanks the reply Frank.

        “Getting a precise fix on return on marketing investment is very difficult using standard tools like regression. Part of the challenge is that there are so many variables that affect the results and many of them are beyond the control of the destination.”

        That’s never stopped econometricians before ;). Seriously though, yeah as I’m sure you know it’s difficult to tease out effectiveness for many/most marketing efforts, so was just curious if any work’s been done for HTA specifically since it’s such an important agency here. Either way mahalos again for the input.

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