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Statement by the Travel Technology Association on Important Role the Travel Technology Community Serves in the Travel and Tourism Economy


Steve Shur on July 15, 2020

2.5 million visitors stayed in vacation rental in 2019 and contributed $4.4 billion in spending to local economies

HONOLULU, HI -- As communities and local leaders continue to grapple with the economic impacts of the COVID-19 pandemic, a new report finds Hawaii will have to offer consumers a complete mix of accommodations, including vacation rentals, to attract visitors and help the local economy recover. The analysis, commissioned by TravelTech and conducted by Oahu-based Kloninger & Sims, is based on recent consumer travel sentiment and analysis of vacation rental visitors to Hawaii in 2019. 

The COVID-19 pandemic has disproportionately impacted the travel sector and how people travel. Recent consumer research, including reports from Destination Analysts (DA), Longwoods International (LI),  and MMGY Travel Intelligence (MMGY), indicate COVID-19 is changing consumer travel trends in significant ways. Highlights, include: 

  • Cars over flights: 62% of US consumers consider air travel “somewhat unsafe” or “very unsafe” and 68% feel safer taking a drive trip for their next vacation according to research by DA and MMGY respectively. 
  • Affordability is key: 46.6% of consumers expect to spend less on leisure travel in the next 12 months than they did the previous 12 months per an analysis from DA. 
  • Accommodation preferences: consumers appear to perceive accommodations as a relatively safe component of travel, according to DA. When asked to name three most unsafe components of a trip, only 13.7% of consumers included hotels in the top three, and only 11% included staying in an Airbnb. 

These findings are significant as tourism dependent economies such as Hawaii focus on a long term strategy to safely reopen travel and help businesses across the state recover. 

“With many consumers reluctant to travel and concerned about their personal economic situation, the pool of potential Hawaii visitors in the coming months and years is expected to be smaller than pre-COVID-19,” said Erik Kloninger, Partner, Kloninger & Sims. “Offering consumers the complete mix of accommodations they seek, including hotels, timeshares, and vacation rentals can allow the recovery to proceed as demand returns.”

The report also found visitor spending associated with vacation rentals will be an important component of Hawaii's economic recovery, supporting local jobs in the restaurant, retail, transportation and entertainment sectors that have been lost during the tourism shutdown. An analysis of 2019 visitor arrivals to the state found nearly a quarter-- or some 2.5 million people-- stayed in vacation rentals and spent $4.4 billion in the local economy.

“The visitor industry is Hawaii’s main economic engine and it’s more important than ever that officials take a holistic approach to help the economy recover from the impacts of the pandemic,” said Steve Shur, President of TravelTech. “The data in this report makes clear any restraint on the ability of vacation rentals to welcome back visitors will be a drag on the state’s ability to recover. Consumers are voting with their feet and if they cannot stay in vacation rentals when visiting Hawaii, the state is likely to lose their business and much-needed spending.”  

A further analysis on visitor spending per party by accommodation type found vacation rental and condominium hotel visitors stay longer and spend more when visiting Hawaii. In 2019, vacation rental visitor parties spent $3,400 and stayed an average of 8.81 days, compared to $2,900 and 6.13 day stays for hotel visitor parties. This is important given current Department of Business and Economic Development & Tourism (DBEDT) forecasts estimate it will take six years for Hawaii’s visitor arrivals to return to 2019 levels.

Given their substantial market share in accommodating visitors and generating meaningful economic activity across the state, vacation rentals will be an important component of Hawaii's tourism recovery in the coming months and years.

In 2018 Travel Tech issued a report that found visitors staying in alternative accommodations on Oahu, including vacation rentals, spent more than $1.1 billion in 2017 and generated more than $2 billion in economic activity to support 12,000 jobs and $564 million in total household income. 

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About Kloninger & Sims Consulting LLC
Kloninger & Sims Consulting is a Honolulu-based consulting firm specializing in lodging and tourism. The firm provides research and analysis for public-sector clients such as the Hawaii Tourism Authority, in addition to various private-sector clients. The principals of Kloninger & Sims have over 30 years experience providing advisory services in the Hawaii market.

About Travel Tech 
The Travel Technology Association (Travel Tech) is the voice of the travel technology industry, advocating for public policy that promotes transparency and competition in the marketplace to encourage innovation and preserve consumer choice. Travel Tech represents the leading innovators in travel technology, including global distribution systems, online travel agencies and metasearch companies, and short-term rental platforms.