Interview with Istvan Pasku, Director of Tourism
What is the current situation in the tourism industry?
We got a report from UNWTO (United Nations World Tourism Organization) in October. Its findings are effecting us too, and our statisics correspond with the global numbers: both international tourism and our bookings dropped by 70 percent in the first eight months of 2020 versus last year.
- Number of international nights dropped by 70 percent January - August vs. last year, primarily because of the travel restrictions and border closures.
- Number of international arrivals dropped by 700 million, which means a 730 billion USD missed revenue in the tourism industry. This impact is eight-time more severe than the crisis in 2009.
- Tourists' spendings have also dropped, however they started to recover a bit in July and August on some markets (eg. USA, Germany, Italy, etc).
- International tourist arrivals have grown again in July-August because of the re-opening in the EU.
- Forecasts prognose a 70 percent decrease in total for the year 2020.
- Nevertheless there was an upswing in domestic tourism, especially in China and Russia, but it is valid for the Czech Republic, Slovakia and Hungary too.
- According to the UNWTO experts, the industry will start to recover as of summer 2021 and will reach the pre-pandemic level by 2023. They say the main concerns are the border closures and travellers' lost trust.
What are the promising news? What impacts the quicks tests and vaccination are likely to have?
The industry certainly expects that the countries introduce a harmonized regulation which will make planning, booking and travel more predictable.
The vaccine and its acceptance among travellers will surely effect this regulation. I can imagine that in the future we will be allowed to enter certain destinations only if we have proof of vaccination, and some airlines and cruising companies may dictate the same.
There are high expectations against / for the vaccine, but the question remains, how can big crowds get protected. This may delay the recovery of the travel industry.
Meanwhile this process might speed up with the use of COVID quick tests, which enable us to detect infection with 99% certainty within 15 minutes. These tests will by most likely introduced at the airports by December this year to test the travelling crowd. Passengers will be tested on the spot and the chance of contagion onboard and the dissemination of the virus accross countries will be minimized. So border closures will be needless in air travel, and it may recover by January – at least partially.
While this goes on what is the travel industry focusing on?
Travellers yet mistrust international travel. However domestic travel is booming in many countries and replaces international, because people are keen on moving out and dicsoveries. They feel more comfortable and safer in their home countries. Most probably business and frequent travellers will start to travel internationally.
I got some statistics from Phocuswright just recently which gave me confidence in the future saying that 9 out of 10 people is planning to travel during the next 12 months.
The result of this survey is summarized in this chart. We see by countries how many percent of the people would travel right now, in the next 6 months and in the coming year? I guess results would be similar in Central Europe too.
What is Fireflies aiming for in this period?
Our Contact Center overloaded during the spring wave of this pandemic when we had to cancel or modify thousands of bookings. As we managed to cope with this challange, we remained in this flow. During the summer period booking trends made an upswing, but in September a drop followed. We balance these ups-and-downs by resetting our focus and re-allocation of our energies. So if we have many travellers on their way, we focus on their needs, and if we have less travellers, we work on the effectivity of our operation. This also means to stregthen our IT department and make IT developments, as we are a tech company in the tourism industry.
We invest a lot in these enormous developments because we wish to surround our travellers with an even more user-friendly digital environment and with an even better-prepared, efficient and professional service, when travel season booms – hopefully in summer 2021.
Why is it worth to persist and keep on investing?
In these difficult times many tourism company cannot choose but close. We – relying to our stable financial background – can spend this period with preparations: we matured strategies to gain new markets and win left-behind travellers trust especially on markets where some players kneeled-down on closed. We can expect, that positions of the travel industry will be re-distributed. We aim for an even more significant presence on the market combined with a higher servicing quality.
What benefits can memberships in international organizations offer?
We can truly be proud of being member of the ETOA (European Tourism Organization) (https://www.etoa.org) and the STAR (Association of the Swiss Travel Agencies)(https://www.star.ch) .
Members of these communities share valid, professional information. The year is cut to periods, for example in September we discuss trends for the following year.
I am interested in such talks for two reasons. On one hand we share experiences and market knowledge with other Online Travel Agents, what are the most common user behaviour in certain markets, which solutions work, and which ones do not. I share these learnings with our IT developers.
On the other hand I am buyer in these meetings, where I negotiate with hotels and accomodation providers about next year's offers and sales strategy. No secret, I aim to get the most possible rooms for a lower price and I try to convince hotels not to give these rooms to booking.com. This way we kill two birds with one stone.
What is Fireflies doing well?
Many market actors admire and envy us for having a real community which works as a tightly knit, "private user group." Other companies have to invest a lot to build something like this, but for us it originates from our business model. In such critical times as the one we are in, a community like ours has great value. Our business model is direct sales. Our salespersons are our ambassadors, who are travelers themselves -- travelling ambassadors if you will. No other loyalty program has such a strong internal cohesion. It is my daily experience that our company can build far more trust than an online reservation portal lacking real community and personal interconnections.
We also seem to be ahead of the competition in terms of selling travel balance. This model has not been unknown for other players, but so far it has only been used for giveaway vouchers (e.g. for honeymoon trips). But now, as we face all these cancellations due to pandemic, service providers are seeking to compensate bookings for cancelled flights and hotel reservations with vouchers. By helping to maintain cash-flow and keep loyalty, this method has become so popular that they started to offer vouchers higher in value than the cancelled service.
In a word, travel vouchers are becoming popular, which is hardly a surprise because they are lot more flexible and can mean bread-and-butter in the unpredictable times we live in.
What warranties can Fireflies offer?
First of all I want to highlight Fireflies Hotline, to acknowledge our colleagues' efforts.
The Hotline is really unique, with staff taking travelers' calls 24/7, in the last 48 hours before they leave on a trip, and during their travel as well. In a pandemic situation like the one we are in, having such a non-stop service is truly special.
Our contact center is available to handle client problems and requests. It is a huge advantage in the CEE region that users can get help in their own native tongue, instead of being helped by someone from another, possibly distant culture. This is a key to building trust among travelers.
Travelers can book all travel services at one go using our travel portal.
People who wish to build business and become a distributor can get paid. We operate a transparent bonus system and pay our bonuses biweekly.
Distributors can run their business as independent entrepreneurs. In our system, the commodity is travel itself, something that almost always creates positive associations of leisure time and family life. Our system offers community life a and team spirit. Sharing travel experiences inspire others.
We also get a lot of positive feedback from our travelers regarding our Swiss insurance with a 5 million CHF liability coverage. It would also cover unexpected costs of bringing travelers home if they got stuck abroad. This also deepens trust, especially in such turbulent and unpredictable times.