28 Jul 2020, By Adrian Enright, Chief Customer Officer

How to capitalise on the returning green traveller

What does the post-COVID world look like for travel businesses seeking to tap the growing number of environmentally conscious consumers? And what’s important in taking this new product to market?

If there was any question about the pent-up demand for travel, it was answered by Jetstar’s most recent sale.

Jetstar’s $19 domestic fares sold out at a rate of 220 seats per minute. That’s 40 times higher than the rate of a normal day.

Which got me thinking? “I wonder how many of those customers have ticked the box to fly carbon neutral? Will this be a turning point for sustainable travel?”

Well, our initial analysis suggests this might be the case.

Take the fact that the same proportion of customers have chosen to Fly Carbon Neutral with Qantas during COVID as they had during previous months. And the previous months saw record numbers of people flying carbon neutral, especially in the wake of the Australian bushfires.

Further evidence came two weeks ago via an IATA* survey of almost 5,000 people from 11 countries. It showed awareness is high, expectations are high, and flying customers are willing to (and have) changed behaviour on environmental concerns. Customers also haven’t let their expectations on the carriers waver either. Almost 70% agreed or strongly agreed airlines need to focus on CO2 emissions post-COVID.

In the US and UK, a recent Forbes survey found 80% of people were ready to take greater individual action, while 88% were leaning on brands to give them more sustainable products.

So what’s driving this behaviour and do people actually do what they say they will do?

In terms of drivers, the biggest in my experience working in this field are the growing volume of customers wanting to do the right thing, technology empowering them to do it, and access to information allowing them to quickly verify if the action is legitimate.

But saying you will do something, and actually doing it are two very different things. In fact, we know from our work with the Qantas Future Planet program that although 45% of customers say they will offset, only 10% do.

One of the key reasons there’s such a big gap of latent demand is that the individual isn’t making the booking. It’s done via an online travel agent (OTA) or through a corporate travel agent, most of whom don’t offer offsetting. If they do, it’s not part of the booking flow, therefore adding yet another step in the customer journey. A cardinal sin for any new product!

It’s why we have developed BlueHalo. A software as a service that can simply be plugged into a travel booking flow and accurately calculate the carbon emissions of any flight, hotel, car or freight product in microseconds, and then deliver the customer an immediate option to carbon offset the trip (which is typically less than 1% of the trip cost).

It’s faster than anything in market. It’s more accurate than anything in market. And it’s easy for customers.

But who are these ‘customers’?

Well, contrary to many publicly voiced opinions, it’s not just your inner city, latte sipping, woke customers. It’s much wider than that.

In fact, the challenge we have found in developing go-to-market strategies for our clients is crafting the narrative around the product to be broad enough to appeal to more than just this cohort. Whether you are indeed an inner-city ‘woke’ consumer or a rural dwelling pensioner, the demand is about the same. And it’s high.

Which highlights a valuable lesson. Talk to people’s values, not their demographics.

And which values hit the mark? Well, the consistent trend is towards intergenerational equity and local impacts. Australians in particular want to know that their actions are securing a better future for their kids, and they’re (not surprisingly) wanting to back Aussie projects.

So, all this points to a consistent and compelling trend in the market that is clearly not going anywhere but rising on the level of public consciousness.

But, taking the offering to market needs to tread the delicate balance of customer simplicity and product credibility. This is not always easy. But done with the right partners, it will be set up for long-term success.

Important information

This information has been prepared by Tasman Environmental Markets Australia Pty Ltd (TEM), a corporate authorised representative (ABN 97 659 245 011, CAR 001297708) of TEM Financial Services Pty Limited (ABN 58 142 268 479, AFSL 430036). This material is for general information only and is not intended to provide you with financial advice or take into account your objectives, financial situation, or needs. While we believe that the material is correct, no warranty of accuracy, reliability, or completeness is given, except for liability under statute which can’t be excluded. Before making an investment decision, you should first consider if the information is appropriate for your circumstances and seek professional financial advice. Please note past performance is not a guarantee of future performance.