Escorted Tour Segment Sees Positive Trends for 2022, Omicron Notwithstanding

The New Year looks to be a good one in the escorted tour segment – with bookings for 2022 departures near or even exceeding record pre-Covid levels, tour clients extending their stays, and prices remaining relatively stable.

Those predictions, like so many predictions these days, come with a caveat: Omicron, or a subsequent Covid-19 variant, could derail things at any time. But so far, so good escorted tour operators told Travel Market Report.

“Overall 2022 sales are up significantly over 2019,” said Guy Young, USA president for Insight Vacations and Luxury Gold. “For the premium and luxury operator, there is a lot of demand.”

Tauck too reported healthy bookings for 2022. “We’re seeing incredible demand,” said Steve Spivak, vice president, global sales and partner relations. “The most popular departure dates and times of the year, June and September, are long since at full capacity with waitlists.”

At Collette, 2022 projections for both domestic and European trips are close to the firm’s 2019 numbers, said Jaclyn Leibl-Cote, president and chief brand officer. “It’s people making up for lost time.”

Central Holidays is optimistic too. “We’re looking for 2022, hopefully, to be between 2018 and 2019, and 2019 was a gangbuster year for us. By 2023, we expect to be way over 2019,” said Margie Bell, vice president of sales.

Unfavorable factors
That’s not to say that everything is looking rosy for escorted tours in 2022. Sales for first quarter departures are soft. And booking patterns are far from normal, with operators reporting both longer booking windows than normal in tandem with unusual short-term demand as travelers make last-minute decisions based on the latest Covid news.

What’s more, as advisors know well, a significant share of tour bookings for 2022 departures are re-bookings from canceled or deferred 2020 and 2021 departures. (A recent USTOA member survey found that 41% of 2022 bookings were re-bookings; at least one escorted operator, Tauck, said that as much as 50% of its demand for 2022 consists of re-bookings.)

Prices are mostly stable – for now
One piece of good news for travel advisors and their clients is that even with rising inflation, escorted tour prices for 2022 are, for the most part, consistent with pre-pandemic pricing.

“A lot of operators, us included, are trying very hard to keep pricing comparable to what it was pre-pandemic because we don’t want people to have sticker shock,” said Bell of Central Holidays.

At Collette, 2022 pricing “has not jumped significantly; it will be comparable to what we would have priced in 2020, for the most part,” Leibl-Cote said. “It’s not that we have not seen any increase in pricing; there has been some as demand has come back,” she added.

Prices at Tauck in 2022 also are in line with previous years, with “no significant increases,” Spivak said.

Higher-end increases
But that pricing consistency isn’t true across the board, nor is it likely to last. At Insight Vacations and Luxury Gold, 2022 prices are up over 2019, Young said. “We’ve got very strong sales, so we’re not doing a lot of discounting.”

Rising costs, including hotel rates, are another factor. Young also pointed to the extra pandemic safety measures that Insight Vacations and Luxury Gold are taking, including adding a wellbeing director to some 2021 and 2022 departures (directors will be on departures with 15 or more guests for Luxury Gold, and on departures with 20 or more guests for Insight Vacations).

“Everything we’re doing to make sure our guests have peace of mind is costing extra money,” he said.

Collette’s Leibl-Cote warned advisors that they need to be prepared for surging demand to drive up prices down the road. “As travel comes back over the next couple of years, most likely in an aggressive manner, the supply chain is going to become extremely challenging.”

Staying longer in fewer places
One positive trend that operators see in 2022 is escorted tour guests extending their stays, whether by combining tours or tacking on pre-and post-tour stays. “Trip length has increased over 2019. People are willing to pay more, travel longer,” Young said.

For Collette, the trend is most prevalent in Europe. “What might have been 10 to 12 days pre-Covid, now we’re seeing 14 days or longer. People are pairing tours or extending in destinations. It’s not surprising, because people were home for so long, and now they have the time,” Leibl-Cote said.

Concerns about difficult border crossings amid changing Covid protocols are affecting booking patterns too. Insight Vacations and Luxury Gold are seeing more demand for single-country and two-country trips. “Multi-country trips are down quite a bit,” Young said.

Trending destinations
As for where escorted tour clients are headed in 2022, the pandemic continues to drive strong bookings for U.S. destinations, especially the national parks.

Canada, after being out of reach for much of 2021, is likely to surge in 2022. “We are expecting a big bounceback for Canada,” said Cory McGillivray, channel marketing manager for Globus.

Overseas, popular destinations in Europe are the odds-on favorites for 2022. “We expect a lot of pent-up demand for Italy, Spain, Portugal, Ireland, Scotland, and France. We expect that pent-up demand to really let loose in 2022,” McGillivray said.

Perhaps surprisingly, travelers are not jumping at the chance to visit their bucket list destinations, choosing instead to revisit favorite European destinations, McGillivray said. “There’s still a little apprehension. Exotics will take a little longer to recover.”

But Tauck isn’t seeing that hesitancy. “We’re not seeing a style of travel or a destination that is off the table. Our more exotic destinations, like Africa, Israel, Jordan, Egypt, are as popular as ever,” Spivak said.

Several other operators noted that Egypt in particular is looking good for 2022, and Insight Vacations and Luxury Gold said that Africa is also selling well.

Other traditionally popular destinations are less likely to see much escorted tour business in 2022. For instance, although Japan is selling well for Collette, the rest of Asia is “going to take quite a bit of time to come back,” Leibl-Cote predicted.

And continuing Covid restrictions on travel to Australia and New Zealand make both destinations a tough sell right now.

Travel style
Other trends in escorted tours for 2022 and beyond are largely a continuation of pre-Covid developments, in some cases accelerated by the pandemic.

These include a growing preference for smaller group tour groups. Especially during a pandemic, “people are willing to pay more to travel in more intimate groups with more personalization, more personalized service,” Spivak said.

Tours that feature cultural and immersive experiences and/or less-visited destinations continue to grow in popularity – even more so now because they tend to attract well-traveled, repeat clients who are less fazed by the ups and downs of Covid.

“We have seen an uptick in interest in more unique touring. Those that travel on the heels of a pandemic are confident and more experienced travelers, often repeaters. They want to try something different,” McGillivray said.

At the same time, McGillivray said, there will always be a place for traditional, full-size escorted motorcoach tours, especially to Europe, and Globus expects to operate quite a few of its tours at or near pre-pandemic capacity. “Now that we’ve put the safety protocols in place, the need for those smaller group sizes has dissipated. People understand that we’re taking the precautions.”

That dovetails with findings in USTOA’s recent survey of member operators. The survey found that among product types, classic group tours of 25 or more passengers had gained in popularity, moving up from fourth to sixth place.