1. Trends In Consumer Preferences For Sustainable Travel & Tourism Since 2003 ESRC Festival Of Social Science @ Centre for Business and Society Manchester Metropolitan University Business School “Resolving The Conflict Between Consumerism & Sustainable Development” @MikeBallEco

2. INTRODUCTION TASK: to resolve the disparity between consumerism and sustainability One way we can do this is improve the marketing of sustainable tourism We will examine a destination, South Africa, and two demographic cohorts, Baby Boomers and Millennials The purpose being so that we can identify what trending consumer preferences there are that: a)we can direct sustainable tourism businesses along in order to maximise market exploitation, and b)to identify negative trending consumer preferences so that we can adopt mitigating market strategies against these particular effects @MikeBallEco

3. South Africa 1996 White Paper The Development And Promotion Of Tourism In South Africa identified Responsible Tourism as the guiding principle for development of tourism in South Africa 2002 Cape Town Declaration On Responsible Tourism In 2003 South Africa published its National Responsible Tourism Guidelines A national policy of Responsible Tourism was launched in 2009 @MikeBallEco History of involvement with Responsible Tourism

4. Foreign & Tourists Arrivals To South Africa Versus Global International Tourist Arrivals, 2003-2013 Source: South African, Tourism Strategic Research Unit; UNWTO Tourism Highlights 2014 Edition Notes: n/a = not applicable; prior to 2009 the measurement of arrivals was of All Foreign Arrivals, after 2009 the measurement was changed to Tourist Arrivals @MikeBallEco

6. Tourism From Lesotho A key characteristic of South Africa inbound market - the majority of arrivals originate from neighboring countries In 2013 arrivals from Lesotho decreased by -9.1% due to domestic economic problems and two successive crop failures Most Africa Land arrivals are Visiting Friends & Relatives (VFR) while another significant proportion come across the border on Shopping For Business i.e. trade in small household items, foodstuffs, clothing, etc In 2013 11.4% of Africa Land arrivals crossed the border on Shopping For Business In 2012 24.6% of all Lesotho’s arrivals crossed into South Africa for Business Shopping, by 2013 this had fallen to 12.2% VFR and Shopping For Business have limited or lesser direct contact with sustainable tourism products and services @MikeBallEco

7. 45.9% of arrivals from Europe came on holiday 33.8% of arrivals from Asia & Australasia on holiday 43.9% of arrivals from the Americas came on holiday @MikeBallEco “In 2013 growth in arrivals was strong in all air markets”

8. Total Foreign Direct Spend (TFDS), South Africa, Vs Global Tourism Receipts, Y-on-Y Growth, 2013-2010 Source: South Africa Tourism / UNWTO @MikeBallEco “In all years except 2011 – the year after South Africa’s World Cup and therefore a pretty tough act to follow, air market Y-on-Y growths have exceeded global rates”

9. Total Foreign Direct Spend By Tourists, All Regions, 2011-2013 In markets where leisure forms a majority proportion of arrivals, TFDS contributions were strong over 2011-2013 However it wasn’t all good news TFDS revenue from Europe grew from 2012 to 2013, but Average Spend Per Tourist declined by -2.1% TFDS also grew from the Americas, however Average Spend Per Tourist decreased by -0.9% TFDS also grew from Asia-Australasia, this market though saw a R500 increase in Average Spend Per Tourist Arrivals from the two main traditional source markets are still resorting to cost-saving strategies on holiday @MikeBallEco Source: South African Tourism

10. Baby Boomers Born between 1946 to 1964 (today aged 50 – 68) British Baby Boomers drive spending on UK’s high streets Going forward will continue to be important for marketers and brands to court 18.3 million over-55s in the UK – by 2018 this number will increase to over 20 million The UK population is ageing rapidly, over-55s expected to grow by more than 8% over the next five years This is a large growing market with healthy household finances, high home ownership, savings and investments 54% are ABC1 social grade; 67% fall into the Wealthy Achievers, Urban Prosperity and Comfortably Off ACORN group @MikeBallEco ACORN is UK specific demographic segmentation tool, it segments the UK population into 6 main Categories and then within these categories there are a number of sub-categories, these are referred to as Groups (of which there are 18) and Types (of which there are 62)

11. A survey of Over-55s were asked: @MikeBallEco 45% of over-55s were planning to travel or take a holiday in the next 12 months Up from 2012 when 40% were planning to travel or take a holiday Clearly a sign of growing spending confidence. Holiday plans were especially strong amongst: 55-64 year-olds (52%) Over-55s ABs (62%) Over-55s +£50,000 (74%) “Which of the following, if any, are you planning to do in the next 12 months?”

12. Proportions of people who went on any kind of holiday rises with household income This is particularly true of longer breaks 79% of adults whose household incomes are in excess of £50,000 have gone on a longer holidays compared with 62% on average. Baby Boomers, with a high proportion of retirees, are time-rich More importantly, can book holidays because they have household disposable income The aspiration rate amongst over-55s to go on holiday is especially correlated to household disposable income and is a more important factor than time available. @MikeBallEco

13. Financial Caution @MikeBallEco Not all Baby Boomer trends are positive Disposable incomes among many over-55s are stressed Many have adopted cautious monetary outlook 41% of 55-64 yr olds said they were budgeting more this year (2013) The highest proportion of all age groups The ability to travel is strongly linked with disposable income Key driving factors: – Low economic confidence – Boomerang children

14. Low Price, High Quality @MikeBallEco Key Consumer Trend - the disparity between seeking low prices and at the same time demanding quality Consequence: sustainable tourism products and services are generally high quality high price An Over-55s survey was asked: “Thinking about shopping for yourself and your family, which of the following are most important to you?” – low prices were important to 48% – And 48% did not want to compromise on quality of products they bought

15. Wealthy Baby Boomers @MikeBallEco Baby Boomer market is highly differentiated Many Baby Boomers belong to higher socio-economic groupings e.g. High Net Worth Individuals (HNWIs) Amongst UK Ultra-affluent and HNWIs taking holidays is common All went on at least one holiday in the year to June 2012 46% went on five or more holidays UK affluents are prepared to pay premium prices for holidays 34% spent more than £8000 on holidays in the previous year 67% believed that comfort and service were worth paying extra for when travelling Higher holiday spending is especially high among women UK affluents and those aged 51-60 38% having spent these higher amounts UK affluents display strong tendencies towards family activities Target market for high end family travel

16. Over-55s Attitudinal Differentiation 7.3 million UK adults aged 55+ Four in ten aged 55-64 57% in the C2DE socio-economic gradings 56% are women, 44% are men 37% are separated, divorced or widowed 24% of Moderate Means and 21% of Hard Pressed ACORN groups 49% planning to travel or go on a holiday versus the average of 60% Low price point is a clear purchasing priority 53% wait for products to go on sale before buying Only 3% didn’t mind paying more for higher quality products versus the average of 42% 7.3 million UK adults aged 55+ Four in ten aged 55-64 57% in the C2DE socio-economic gradings 56% are women, 44% are men 37% are separated, divorced or widowed 24% of Moderate Means and 21% of Hard Pressed ACORN groups 49% planning to travel or go on a holiday versus the average of 60% Low price point is a clear purchasing priority 53% wait for products to go on sale before buying Only 3% didn’t mind paying more for higher quality products versus the average of 42% 6.3 million UK over-55s 65% married or cohabiting 48% are 55-64 62% are ABC1 67% own their houses 64% planning travel in the coming year The disparity between low price demands and high quality is at its lowest 64% willing to pay more for higher quality Only 14% will wait for products to go on sale 52% use the Internet daily 6.3 million UK over-55s 65% married or cohabiting 48% are 55-64 62% are ABC1 67% own their houses 64% planning travel in the coming year The disparity between low price demands and high quality is at its lowest 64% willing to pay more for higher quality Only 14% will wait for products to go on sale 52% use the Internet daily 4.5 million UK adults aged 55+ 59% females, 41% males Highest proportion of retirees and property ownership Nearly two thirds are ABC1s 28% households incomes in excess of £25,000 71% planned to go travelling. 92% preferred shops they know and 82% brands they know They are not opposed to paying more for higher quality 24% (versus an average of 9%) find online shopping complex 4.5 million UK adults aged 55+ 59% females, 41% males Highest proportion of retirees and property ownership Nearly two thirds are ABC1s 28% households incomes in excess of £25,000 71% planned to go travelling. 92% preferred shops they know and 82% brands they know They are not opposed to paying more for higher quality 24% (versus an average of 9%) find online shopping complex Family Orientated Prosperous Adventurers Lean Means @MikeBallEco

17. The Millennials a.k.a. Generation Y “A large demographic approaching their peak spending and purchasing years” “Millennial consumer influence as well as spending power will dramatically increase” @MikeBallEco Born early 1980s – early 2000s In the USA Millennials already outnumber Baby Boomers by 79 to 76 million By 2030 there will be 22 million more US Millennials than Baby Boomers In the UK more than a quarter of the population are Millennials Many are leaders in the technology and media industries

18. Social Diversity - ethnically mixed, open-minded concerning family structure, many from e.g. mixed-race families, single parent families, alternative culture families, same-sex marriages, etc. Digital Natives – lived their lives in the digitally connected era, media and tech savvy from a very young age. Global Citizens - care about the environment, bettering lives of people, and improving society. Many Millennials are well travelled, cosmopolitan. Female Empowerment – live in much more gender equal environment, women Millennials expect the same treatment and opportunities as their male counterparts. Gregarious By Nature – family orientated, many are still dependents, Boomerang Millennials, Millennials with their own young families. Also Millennials value their friendships, online and in the real world. Participatory And Active – Millennials like to be involved and are hands-on when shopping, look for entertaining websites and appreciate channels that allow personalisation. An experiential generation, many are sporty and have active hobbies e.g. shopping, surfing. Educated – better educated, not dependent on an authority figure e.g. parent, manager or teacher, to gain access to information. @MikeBallEco early 1980s - early 2000s

19. Millennial Travel Motivators @MikeBallEco NB: A psychographic index is a scaled measure of personal characteristics (e.g. personality traits, lifestyle preferences, interests, values, beliefs, attitudes, opinions) as opposed to physical traits (e.g. age, gender, height).

20. Millennial Differentiation “Whilst the Baby Boomer market is a highly differentiated one, only recently has a degree of Millennial market differentiation started to appear” “One of the problems when making analyses of non- differentiated markets is that any identification of trends tends to be broad” @MikeBallEco

21. The Boomerang Generation “There is a clear differentiation based on spending power … the youngest Millennials are still dependents living at home while older Millennials with young families and who are beginning to scale the career ladder, are beginning to enter their peak spending years.” The emergence of the Nouveau Poor is a consumer macro-trend Continuing low economic confidence is driving ‘downward mobility’ among middle-class consumers, who have reacted by recalibrating lifestyle expectations for a lower-class reality Amongst the Nouveau Poor Boomerang Millennials are a sizeable contingent They are a target for affordable, pared-down, quality products and services that deliver the comfort and familiarity they’ve been accustomed to Key compatible sustainable tourism areas are: food, the backpacker- flashpacker circuit, city tourism, and new accommodation models @MikeBallEco

22. Marriott Hotels Baby Boomer segmentation is a reflection of personal finances or status in society Millennial differentiation is usually based on differing attitudes One such method is to divide Millennials up into tribal identities In 2013 Marriott Hotels launched its Travel Brilliantly campaign As part of the campaign they surveyed lifestyle habits of UK 18-35 yr olds and identified five Millennial Tribes @MikeBallEco Millennial Tribes Typology

23. “Early adopters of hi-tech gadgetry and digital inventions, fit, sociable, fashionable males, they are well travelled and often use their tech prowess to create start-ups” 58% are interested in fashion 23% love shopping 57% work out at the gym or go running regularly Jason Bradbury, a TV presenter and author recently named Gadget Personality of the Year by T3 Magazine. Jason has flown to the four corners of the globe to research the science and technology of the future @MikeBallEco DESIRABLE DIGERATI Marriott also defined a tribe leader for each of the tribes:

24. “Fashion forward, savvy, self-employed, likely to have had a career change after having kids to fit around their lifestyle. They like to blog and engage via social media, many have their own websites. They tend to work alone and have a passion for fashion” 70% place huge import on personal image, they shop in vintage shops, charity shops and eBay Interested in the environment, 69% regularly recycle Avid mini breakers taking up to 10 UK trips a year @MikeBallEco FASHIONISTA MUMPRENEURS

25. “fitness super-fans who thrive on the challenge of physical competitions. Keen sharers on social media, Competitive Challengers travel in groups and are always on the look out for adventure, they are driven people who take trips all over the world to take part in competitions” Prefer adventure holidays, with a third opting for backpacking trips 27% aren’t interested in technology apart from listening to music 1 in 4 describe themselves as very energetic TRIBE LEADER: Danny Care, rugby union, Harlequins and England. His passion, gritty determination and talent, has seen him rise to be one of the best players his age @MikeBallEco COMPETITIVE CHALLENGERS

26. “Lovers of the Selfie and social apps, these well-groomed, young, carefree spirits prefer to party at home or away, rather than pursue anything cultural or academic” 60% are always up for a good party They have short attention spans and high self-esteem Almost 40% said they rate themselves as attractive and well groomed TRIBE LEADER: Victoria InTheFrow, is a Celebrity Blogger, fashion doctorate, graduate and lecturer @MikeBallEco SOCIAL MEDIA SAVVIES

27. “In the city by day, cookery by night, found at food markets at the weekend. They have a gift for numbers but a passion for all things foodie. A growing number ditched their lucrative jobs to start up food related businesses” 73% say they dedicate large amounts of spare cash towards food 53% use social media to read about food TRIBE LEADER: Luiz Hara is a former investment banker turned chef and travel writer. Host of the #Nikkei Supper Club. Born in Brazil to Japanese and Italian parents and educated in the UK @MikeBallEco FINANCIAL FOODIES

28. @MikeBallEco Marriott’s ‘Travel Brilliantly’ Concept Guestroom An example of how all these tends can be fed into marketing Marriott incorporated their differentiation system plus a number of themes mentioned earlier e.g. experiential participation, active involvement, tribal digital connectivity, etc Built a concept hotel guest room of the future Tribe Leaders each designed a room Consumers were asked to vote on the best features designed by the Tribe Leaders The winning best features were built into Marriott’s concept guest room