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The ‘Fabio factor’ and consumer confidence
Monday, 07 Oct, 2009
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The ‘Fabio factor’ and its impact on consumer confidence, depending on how successful the England football team performs in next summer’s World Cup, will have a direct influence on the travel industry.
That is one key message to be given to delegates attending the ABTA Travel Convention in Barcelona tomorrow by PricewaterhouseCoopers travel group head Malcolm Preston.
Due to speak at his 15th convention today, Preston will indicate how the feel good factor could return and flow into late holiday bookings depending on how far England gets in the South Africa tournament next June.
"How England performs in the World Cup will impact on consumer confidence as it helps when people feel good about themselves," Preston said.
Conversely, he believes next year’s general election outcome will not register on the richter scale of the global economy.
Preston, who believes we are still in the middle of recession, will not forecast the timing of recovery but point out fundament shifts in consumer behaviour forced by the downturn.
Key amongst these is that people are now ‘buying clever’ – a trend he sees as a fundamental shift in the way people approach purchases, not only of travel but also clothing, retail and eating out.
“The consumer is much more price conscious and getting more educated to be more discerning about what value means,” he said in advance of his Convention presentation tomorrow (Wednesday).
Not one person questioned in vox pops for the Convention talked about buying cheap or low value, he added.
But the travel industry needs to understand that what people value is shifting and to address that.
“In a recession you have a much harder look at what you value,” said Preston. “Some people value 14 nights away but will trade down. Some say their holiday is sacrosanct, don’t want to trade down so are taking ten or 11 nights rather than 14.”
The “critical” challenge for the travel industry is how to “unbundle value” by understanding what the term means to different people, according to Preston.
As for the end of the recession, he said: “I would say don’t plan on things coming back quickly. Assume summer ’10 will be relatively difficult.”
*Preston’s colleague Mark Hudson will present video views of leading retailers from organisations such as Whitbread and Morrison’s as part of his Wednesday morning Convention presentation on how economic conditions will affect consumer behaviour.
by Phil Davies
Phil Davies
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