With cruise ships docked in ports, air travel falling by almost half, and more than 75% of the U.S. under some form of lockdown due to the coronavirus, it’s safe to say nobody is—responsibly—traveling.
And while customers are either too worried about the risks to travel or their local governments won’t allow them to go outside of their homes let alone any farther, the travel industry is pulling back on advertising.
In 2019, the travel industry—including hotels, domestic tourism bureaus, cruise companies and airlines—spent a combined $850 million on advertising in Q2, according to ad sales intelligence company MediaRadar. In 2020, that figure is expected to drop precipitously.
“We basically saw everyone stop,” said Todd Krizelman, CEO and co-founder of MediaRadar.
Of that $850 million total, airlines spent $120 million with 72% of it dedicated to digital ads, often the easiest to create and distribute, unlike a high-production 360 campaign. “Brands can cut back very rapidly,” Krizelman noted. “They’ll save the cash.”
Cruise lines have seen the steepest drop-off since the outbreak. Between January and the first week of February, cruise lines spent between $12 million and $15 million a week on advertising—then dropped to $3.7 million in the final week of February, and $1.2 million and $1.1 million respectively in the last two weeks of March.
Since Feb. 17, when airlines spent roughly $3.1 million on digital, television and print advertising in a week, that spending has fallen. The lowest point so far was March 9 with only $799,000 spent that week, then bouncing up to $1.2 million the week of March 16. For comparison, in 2019 not a single week passed without the airline industry spending at least $1 million on advertising.
In the midst of the pandemic, airlines have shifted their focus messaging to focus on flexibility. MediaRadar pointed to two digital ads by two of the largest airlines in the country, American and Delta.
The first shows an American Airlines plane about to take off above the tagline that calls on customers to purchase a flight with the guarantee that if they need to change their plans, they won’t be hit with a fee. To entice people to accept a voucher for a future trip instead of requesting a refund, the airline is also currently boosting the value of vouchers by 20% over than the cost of the original flight.
Meanwhile, Delta emphasized the safety initiatives undertaken since the outbreak of the disease, including emailing customers a four-minute video featuring Delta employees disinfecting check-in counters and fogging empty planes.
While ad spend is still expected to continue dropping in the coming months, Krizelman still expects airlines to do the bare minimum as far as messaging and advertising, especially if they agree to take a check from taxpayers.
“They’re about to get a huge bailout,” he noted. “In Q2 and Q3, you’ll see new marketing efforts that really try to present that decision as in the best interest of the country.”