Romer: COVID-19’s impact on local business
You are surely following the news regarding COVID-19, commonly known as coronavirus.
Eagle County Public Health has put together a resource page from the most trusted sources to help you learn more about precautions you and your family can take, what to do if you get sick, and what you can do if you are an employer, at http://www.eaglecounty.us/COVID19. We also encourage you to visit http://www.ecemergency.org/ for the latest local information.
What does it all mean for our tourism economy and our business community?
As pop culture icon Taylor Swift said, “you need to calm down.” Fueled by social media, consumers will react irrationally because it is what consumers do. We are seeing shelves in stores being cleared of essentials, and vacations will be canceled. But, consumers will also realize that life goes on and adapt to the new normal. There will be (to be determined) impacts, but the world — much like after 9-11 and in 2009 — keeps spinning.
That’s not to minimize the impacts of COVID-19. Rather, it’s to reinforce that our collective response must be grounded by facts, not driven by fear. Further, it should focus on slowing the spread of disease and protecting the most vulnerable in our community.
Regarding business impacts, our partners at Inntopia report the following:
Based on how consumers behave and what we’ve seen in the marketplace under other stress conditions, we can suggest some likely performance scenarios, under the assumption that COVID-19 continues to spread as expected, and that the economy will continue to see instability in the mid-term, also as expected.
Guests: International vs domestic
In the category of “no kidding,” destinations with larger international guest bases, such as elite mountain destinations in the West, will likely be impacted more significantly by travel bans or fear of travel than those destinations that rely more heavily on a drive market. This is likely to be true irrespective of whether those destinations’ primary source markets are impacted by the incidence of coronavirus or not.
U.S. travel consumers intending to go abroad this year are more likely to cancel or not book at all and stay domestically if they choose to travel. This will create an opportunity for U.S. destinations to pick up more domestic travelers, partially offsetting international visitation losses.
Drive vs pure destinations
This is the domestic version of staying domestic above, but in the “drive versus pure” destination context. Domestic drive destinations will get a relative boost over domestic pure destinations, with pure destination consumers shifting to drive markets as they forego long-haul mass transport. While it’s obvious that not all long-haul travelers will shift, what we won’t really know is how many replace their with long-haul travel to drive travel or if they will cancel completely.
Group vs fit
Properties or destinations that rely heavily on group, conference and corporate bookings are likely to feel the effects sooner and more strongly than those with fewer group stays. Group stays may be subject to cancellation by operators, the buying group itself, or individuals dropping out of the group stay resulting in canceled rooms. In an early indication, many corporations have already instituted non-essential travel restrictions for staff.
Destinations that rely heavily upon theme parks and other high-volume recreation areas are likely to be more heavily impacted than destinations that rely more heavily on outdoor, non-group activities.
At times like these, it can be easy to fall prey to panic. But that is why we must stick to the facts. Let’s all make a point to listen to health experts, take reasonable precautions, and do not overreact.