6 May 2020

Dear All

In this week’s edition of the market intelligence update, we see the next wave of BDA BDRC’s consumer sentiment which shows the long term trend that nearly 1 in 4 UK consumers believe we’re past the worst of the crisis, although a bit more pessimistic about when life will return to normal. There’s some interesting insights from VisitBritain tracking research in terms of UK holiday intentions, with Scotland being cited as a top destination being considered.

We continue to update you on insights from our key markets, particularly as some European markets ease the most severe travel restrictions, and some tour operators are innovating to add more tailor made experiences to diversify their offering.

Keep an eye on our marketing response section on visitscotland.org – sharing information on how we’re keeping Scotland top of mind using different channels, including intermediary communications, PR and of course, developing new content.

As always, please let me know if there is any further information you would like to see included in this report, and don’t forget to follow Malcolm Roughead on Linked In for his latest thoughts on Restart and Recovery.

Stay safe

Vicki

COVID-19 has had such a profound, dramatic impact on our world. The World Bank has reported that our new reality is showing what an immobile world can look like and the significance transport plays in the global economy. So, will coronavirus herald a new era for transport, and will we see a push for sustainable and climate-friendly solutions?

COVID-19 and transport has ramifications on three goals of sustainable mobility – digital adoption, safety, and green mobility.

• Digital Adoption: As millions are stuck at home, many aspects of our daily lives have moved online, and the pandemic will undoubtedly accelerate the adoption of online tools. This has ramifications for business travel and policymakers need to consider how virtual connectivity can complement physical connectivity to improve access to jobs, services, and travel.

• Safety: Transport and mobility are recognised as a key factor in the potential spread of viruses and contagion. An immediate challenge for transport systems is how operators protect their staff as well as passengers.

• Green Mobility: An unexpected consequences from the crisis have been on the environment, with the sudden drop in carbon emissions. Could our habits change following recovery and lead to an overall reduction in transport demand, with a direct impact on emissions? A positive example is the pandemic prompting cities to expand bike lanes and promote cycling.

So, the crisis raises viable opportunities to transition toward green mobility. There is still a lot we don’t know about the long-term implications of the coronavirus for the transport sector. Despite the uncertainty, through anticipating changes, use the crisis to steer transport in a more sustainable direction. (Source: World Bank)

Vicki MillerDirector of

Marketing & Digital

6 May 2020

This section will examine some weekly tracking research from BVA-BDRC for the UK domesticmarket which looks at consumer sentiment and travel intentions. Please note that to take partin this research, respondents must have done at least 2 of the following since 1st Jan 2020:-1. Stayed in paid for accommodation2. Went on a day out to a visitor attraction3. Used one of the following transport modes: plane, train or bus

The survey covers all parts of the UK and is nationally representative on gender, age and regions(sample size: 538 respondents (wave 6).

The mood of the nation declines slightly – the first time this has happened in severalweeks. However, the long-term trend of more respondents believing that the worst of the crisis ispast, continues – approaching 1 in 4. Conversely, the proportion of the population who feel theworst is still to come is now just 29%, having halved in the last two weeks.

Balancing the continuation of this welcome trend, a less welcome one also continues. Predictions of when something close to normality will return, continue to edge backwards.

Permission to share this has been given by BVA BDRC. Please register to receive the report of the full findings

6 May 2020

Source: VE survey via TNS Omnibus, 2 -4 April 2020, n=1,248 GB Adults 16+

Finally, VisitBritain have published some tracking research undertaken in early April to ascertain holiday intentions within GB. The results mirror the findings of the survey results above. As expected, many GB consumers have cancelled their holiday plans over the summer but encouragingly Scotland remains one of the top destinations within GB to be considered. Please find a summary below:-

• The majority of the GB population who have planned a holiday from July to September believe it unlikely to go ahead. This is true for both domestic and overseas holidays.

• A minority of the population who have cancelled holidays are looking to replace them, but these replacement holidays are most likely to be from October onward (N.B. this was before Professor Whitty mentioned social distancing being in place for the foreseeable future).

• The South West and Scotland are the top destinations being considered, with rural and coastal the top location type.

• Those looking to replace an overseas holiday with a domestic holiday are more likely to be families, and aged 35-54 years old.

• Those looking to replace a domestic holiday with another domestic holiday are more likely to be aged 55+.

The prospects for the UK tourism markets continue to look more positive than for international travel. For those who are contemplating a summer holiday, rural locations outstrip urban locations, with ‘rural /coastline’ topping the list overall. Only 3 in 10 would prefer a city or large town destination – despite ‘the city break’ traditionally being the most preferred type of domestic short break.

6 May 2020

Safety / reassurance guidelinesAs part of our planning for recovery, providing reassurance of measures taken to prevent infection, is going to be critical in encouraging visitors to return to Scotland. A new set of industry guidelines is being developed by the Scottish Tourism Emergency Response Group (STERG) and it is recognised that a co-ordinated approach throughout the UK will provide best clarity for potential visitors. Discussions around factors such as cleaning regimes, physical distancing options and interaction with staff are all being considered, and updates will be provided as progress is made.

With increasing clarity developing around the nature of what the post lockdown Covid19 landscape will look like, innovators are looking at ways of mitigating against the problems of physical and social distancing while restrictions are in place. The events sector is particularly impacted by physical distancing as a source of mass participation.

• The Danish city of Aarhus allowed singer Mads Langer to perform a drive-thru event at a newly constructed venue just outside the city. With six days’ notice, the event sold 500 tickets to locals. The audio feed was broadcast over a very limited FM radio frequency into fans’ cars.

• While the world waits for a vaccine, design company "Production Club" have developed their Micrashell Concept for ‘Safe Raving While Social Distancing’ at live events and large gatherings. Micrashell is a futuristic suit packed with features, including speakers, LED strips, a camera and an N95 particulate filter and suction system. An incorporated supply system allows you to drink without exposure to the outside elements. While it is a concept for a way to enjoy concerts and events without worrying about spreading a disease it demonstrates the innovation of analysing a current problem and devising solutions to address current need.

• A Swedish couple have developed 'Bord för En', a COVID-safe outdoor restaurant for 1 person only. The open-air 'COVID-19-safe restaurant' includes a table and a single chair in a meadow. The restaurant is scheduled to open on May 10 in Varmland, Sweden and it will accommodate one customer per day. A similar concept to the Null Stern hotel (no walls, just a double bed, with a nightstand and lamps, perched on the top of a mountain.) it is catering to consumers need for safety, sense of normality and experiential trend that has been permeating tourism.

• Singapore has launched a nationwide scheme to audit hotels against a range of enhanced hygiene criteria, with a view to reassuring consumers and delivering a competitive edge. The country has begun an ambitious programme of auditing hundreds of hotels and attractions in light of the government’s strict compliance procedures throughout the pandemic.

6 May 2020

• The current UK lockdown restrictions (extended on 16 April) are due to be reviewed this week. UK Government is expected to reveal exit plans on Sunday 10 April. Lockdown restrictions have slowed down the rate of community transmission of the virus and the UK’s chief medical officer said this week the R rate stood between 0.5 and 1.

• The Scottish Government published a paper on 23 April outlining thinking on a potential strategy for lifting the lockdown. This is likely to include easing of restrictions in a phased manner.

• UK airline routes remain limited or grounded. Loganair’s operating emergency flights only, BA operating a reduced schedule, Ryanair has grounded over 90% of flights and easyJet has grounded all flights. Flybe went into administration (5th March 2020). Rail operators in the UK are also operating reduced services. Health and safety implications for future travel are key focus e.g. easyJet considering not selling middle seats.

• The Coach Tourism Association continues to support UK wholesalers and coach operators with advice and have provided a legal helpline. Operators are continuing to postpone or cancel tours and have bookings open for 2021. Many businesses have furloughed staff. Of those still operating, there are signs of interest in product development for future tours.

• Key OTA's reporting increased search intent for Scotland, indicating interest in Autumn and self-catering.

• When restrictions are lifted, focus for UK travel editors will be domestic breaks.

• On May 4, Germany's R rate was estimated at 0.74 (down from 1.0 on April 28).• Germany's federal border with Denmark is likely to be re-opened on May 15 as easing of

lockdown measures commence.• A few German states may be allowing domestic leisure visits in time for the May bank holidays,

provided the number of new infections across the regions remains low.• Swiss and Edelweiss Airlines will be receiving a joint €1.4bn state aid from the Swiss

government. This sum makes up 85% of the airlines' equity requirements and is granted as loan without government buy-in. This aid cannot be used for the support of other group airlines, e.g. Lufthansa or Austrian.

• Some tour operators and travel agent networks, e.g. DER & FTI, opened their 2021 booking season early.

6 May 2020

• On May 4, the Italian government relaxed its country's lockdown measures. Italians are now allowed to visit family members in small numbers. Parks, factories and building sites have re-opened. Citizens are allowed to move within their own residential region, cross-regional movement remains prohibited. Bars and restaurants previously limited to delivery services are allowed to offer take-away services. It remains compulsory to wear face masks and gloves in public.

• The Spanish government announced a gradual exit of its county's lockdown, with small service businesses resuming work between May 4-11, followed by restaurants and places of worship. From early June, theatres, art galleries and museums will be able to operate up to 1/3 of their capacity, with some schools also re-opening. Late June will see more shops opening and overall restrictions easing further.

• Some tour operators are seen to diversify their business, e.g. by adding MICE elements or expanding on target audiences in order to capitalise on early recovery of business trips and domestic movement.

• From May 11, the French government will relax its country's lockdown measures by region provided certain criteria are met. Retail outlets are to re-open, with a decision on restaurants/bars to follow at the end of May. While schools will gradually re-open, large events remain prohibited until September.

• The French Finance Minister is working on an economic recovery plan to support severely impacted industries, incl. the tourism sector. Until this plan is available (September), support measures currently in place will still be valid until end of May and gradually reduced after that.

• Airline holding company Air France-KLM and Air France secured €7bn in funding to maintain financial stability. This includes a French state-supported loan of €4bn, which will be granted by a syndicate of six banks to Air France-KLM and Air France. Air France's management does not expect the airline group to return to "normal" in the next 2 years.

• As lockdown measures are slowly relaxed in France, tour operators are starting to ask when it will be possible to travel to Scotland, when attractions/restaurants will re-open and what measures will be in place to welcome and receive visitors. They are also interested in knowing whether island travel will be restricted.

• SETO advised its member businesses to cancel/postpone trips up until June 12.• Some tour operators are looking at diversifying their business, e.g. by adding leisure/MICE

elements or improving tailor-made experiences in order to re-position themselves and capitalise on early recovery of different travel sectors.

6 May 2020

• The US Government’s current travel ban to UK and Europe to stop the spread of coronavirus in the US (enacted 16 March) is still in operation.

• President Trump unveiled guidelines for reopening the US economy ‘Opening Up America Again’ with a three-phased approach: https://www.whitehouse.gov/openingamerica

• Over the next few days at least 31 US States are planning phased reopening of businesses and gathering places.

• President Trump has signed the largest-ever US financial stimulus package, known as a CARES act, worth $2tn (£1.7tn) to tackle the impacts of the coronavirus pandemic. The US Treasury is now planning on an additional $3 trillion package

• The US CARES Act directed $58 billion to US airlines out of the $2 trillion economic stimulus package – key beneficiaries pertinent to Scotland are American Airlines, Delta Air Lines and United Airlines who all receive a combination of direct grants and loans (see previous updates for detail).

• Airlines must not cut pay or jobs through Sept. 30 as a condition of the grants and are barred from buying back stock or paying dividends and face restrictions on executive compensation.

• Delta Air Lines has further extended its change fee waiver policy to include existing bookings or cancelled travel through September 2020, as well as extending the expiration date for tickets into September 2022.

• Delta and American Airlines both announced that they will require passengers to wear masks. Delta specifically announced that passengers will have to wear masks beginning at check-in.

• United Airlines has published some revisions to its European flight schedule with transatlantic flights to Scotland resuming in October (reduced services).

• Delta Air Lines has published some revisions to their European flight schedule with flights to Scotland starting in July. Please note that all air schedules may be subject to change.

• Continued focus from intermediaries on ‘dreaming of future travel’ and inspirational content

• Kindergardens and primary schools re-opened in Norway as the country begins to relax some of its lockdown restrictions. The government is asking citizens to take holidays in Norway (staycations) this year.

• SAS Scandinavian Airlines expects it to take several years for them to return to normal operations and warned that they will be needing to reduce staff numbers significantly.

• In the Netherlands tour operators TUI/KRAS, De Jong Intra, Oad and Voigt Travel extended their cancellation dates and are offering vouchers (at face value) for trips that were supposed to go up until 28/05, 27/05, 20/05 and 31/05 respectively. TUI/KRAS also changed their re-booking policy. If a re-booked trip is cheaper, up to 40% of the difference will be refunded. Until 31/08 re-booking is free of charge. Some tour operators started reaching out for marketing materials to re-freshen websites and product information.

6 May 2020

• Australia has approached a point where they appear to have successfully managed the Covid-19 outbreak with very low infection rates across the country and almost zero community transmission. The focus for the government is now shifting to how to get the economy back up and running, whilst always being mindful of potential second wave of infections.

• On 8 May the Government will present their roadmap to recovery including easing restrictions and getting people back to work. Recovery timetables will be managed at a state level with guidance from federal government.

• Discussions continue between Australia and New Zealand about introducing a Trans-Tasman Travel bubble at some point, there have been no timescales attached to this but both countries are supportive of a system that allows for travel between the two without any quarantine requirements in place. Opening of wider international borders not likely for some time.

• Australian government has pledged $165m to underwrite domestic key flight routes for at least 8 weeks, the government aiming to get the country moving domestically asap.

• Qantas announced extension of cancelation of international flights until the end of July whilst Emirates have announced they will commence international flights from 1 July 2020.

• Tour Operators are offering increasingly flexible cancellation or postponement options including rebooking travel up until 2022.With some group operators working on polices and guidelines on how they will manage group travel in post-pandemic world.

• Australian Government has introduced its largest ever government support package –A$130billion to support the salaries of 6 million workers for 6months. So far in total Government aid to support businesses is approaching A$200bn, around 10% of GDP.

• Reminder: CA-US land border remains closed for the next 30 days (from 21 April), this is a further extension from the initial 30 day closure on 20 March.

• It's estimated that Canada's R rate is currently just over 1• Update - Easing of Restrictions: The federal, provincial, and territorial governments have agreed

on a set of common principles for restarting the Canadian economy. The guidelines do not include any specific targets or dates, given the epidemiological differences across the provinces. Full statement here

• Update – Keep it Clean: The industry are looking ahead at how they ensure the health and safety of their customers as lockdown eases and people start to move. A number of businesses have started to highlight ways to reassure their customers going forward. Air Canada have announced their CleanCare+ programme while Marriott Hotels have announced changes to their operations.

• Reminder: Financial aid options for airlines. PM Trudeau has mentioned again support is being discussed but still no further detail. IATA is calling for Governments globally to provide support

• Reminder: ongoing challenges within the industry around refunds/credits, travel vouchers and chargebacks.

• Update: current industry insight shows that this pandemic has highlighted the value of using a Travel Agent and that its predicted that the use of agents will increase once consumers start to book travel again. There are currently approx. 24,000 Travel Agents across Canada. There has been specific trade media interest in the role of a bricks and mortar retail travel agency stores versus a home based agency/agent. Discussion relates to the overheads of having a retail store in the current situation. Will be interesting to see if more store front retail agencies move to become home based as a result of this pandemic.

6 May 2020

Trade• China CITS (one of China's longest running state-owned tour operators disclosed their first

quarter revenue for 2020. This was GBP 865.8M, down 44.23% from same period 2019• Tongcheng (equivalent to Gumtree) & Elong (Expedia) jointly launched a new app and

mini programme. They aim to transform the company from an OTA to ITA (intelligent travel assistant) offering more personalised service and travel advice to customers

• Spring Airlines have announced they will add or resume 47 domestic routes from 3 May• Local Governments in China are issuing free digital coupons to stimulate consumption in F&B

and Tourism sectors. 30+ regions have issued more than 5.6 billion RMB of coupons.

Domestic Tourism Recovery: Hotels• As of 22 April, close to 86% of hotels in China’s major cities were open for business• As of the end of March, average hotel occupancy in China was 31.8%, up from a low of 7.4% at

the start of February• Many of the hotels on the tourism-focused island province of Hainan report that they now have

occupancy rates of around 70%.

Short-Haul Tourism Recovery: Outlook for Thailand• According to the China Thailand Travel Sentiment Survey 2020, 53% of consumers in Chinese

first-tier cities would like to travel internationally before the end of this year.• 71% indicated that they would like to visit Thailand. Another report from the Chinese Academy

of Social Sciences showed that Thailand is now the first-choice outbound destination for travellers.

• The top months for travel plans, according to the CTTS Survey, are August, October, and December

Chinese Academy of Social Sciences ReportThe Chinese Academy of Social Sciences’ “Post-Coronavirus Tourism Trends Report” looks at Chinese travel plans and priorities, including changes that have happened since the outbreak of the virus. Key report findings are: • Travellers' biggest fears are crowded places (48.6%), followed by hygiene of hotels, tourist

attractions, and other facilities (39.7%).• There is increased interest in nature, traveling to pursue one’s interests, traveling to increase

cultural knowledge, and traveling with family and friends.• However, looking at travel plans for this year, there is an increase in plans to travel alone, and a

decrease in plans to travel with family, especially among respondents with children. This may be linked to restrictions throughout China on schoolchildren’s travel, or – as the report suggests –worries about the health of children and elderly parents.

• There is also increased interest in FIT and customized travel, and decreased interest in group travel.

• 66.7% of respondents said they were interested in nature sightseeing, especially forest and desert environments.

• Safety; health and hygiene; emergency services; and travel insurance are all viewed as more important now than before the virus.

• Respondents are now less interested in visiting “well known destinations” than before the virus.

6 May 2020

These charts show the relative booking volume of flights and hotels in EMEA with different departure windows (<15 days advanced booking, 16-30 days, 31-60 days, 61-90 and 91+ days advanced booking). All of the bookings are indexed to 91+ days advanced booking for the leisure segment. This data is provided by ADARA.

Though slightly more resilient in March, bookings for 91+ days in the future had in April dropped to an index of ~2.0 (relative to 2nd Jan), similar to advanced bookings of shorter lengths. In the past week however, a slight increase in long-term advanced bookings has occurred (orange line rise bottom right of charts), likely in response to positive news stories of lockdown restrictions being lifted around Europe.

• Between 28 April to 4 May there were over 4K relevant mentions about Scotland and Coronavirus. Friday 1 May was the busiest day.

• Conversations decreased by 35% compared to the previous week.

• The main conversation topics were:

• A special lockdown version of the song “Home”;

• “stay safe” messages from users encouraging the community to remain safe and continue the lockdown, as well as showing their support by staying home and

• Concern about care homes in Scotland and how they are handling the COVID-19 pandemic.

6 May 2020

• Conversations about COVID-19 take place on social media sites (Instagram 52% and Twitter 46%).

• People used Instagram to share images of their past trips or the landscapes around them, showing their support to key workers and sharing how they spend time in lockdown.

• Similar themes can be found on Twitter, however this channel shows a higher number of conversations about news updates, politicians, government measures and chats about the wider UK.

• Online sentiment is positive (51%) and the main conversations are encouraging messages from the wider community. Negative conversations are driven by news updates and debates about government measures.

Scotland and COVID-1928th April to 4th May 2020

• Then, we analysed online conversations about “travelling to Scotland” or “holiday in Scotland” that contained mentions of COVID-19, or coronavirus.

• 373 relevant mentions were identified under these premises.

• This is a 70% increase compared to the previous week.

• The main conversation topics are people:

• Sharing experiences with trip cancellations and refunds.

• Not being able to travel to Scotland at the moment and their plans to visit when the pandemic is over

• Sharing their previous trips

Travelling to Scotland and COVID-1928st April to 4th May 2020

• 82% of the COVID-19 mentions about travelling to Scotland took place on social media sites (Instagram 28%, Twitter 54%).

• The rest of the conversations spread on forums, blogs and reviews sites as users share their experiences with trip cancellations or talk about their past holidays.

• Online sentiment is neutral to positive as users have adjusted to the current situation.

• Negative chat is mainly driven by news events and users complaining about the difficulty to get refunds for events or trips.

6 May 2020

Traffic compared YoY has remained steady since last week, with domestic traffic down 62% YoY and international down 53%. The three largest international markets (US, Germany & France) are now retaining a little over 50% of their traffic, with France only being down 45% YoY.

Traffic to visitiscotland.org is 3x higher than this time last year, rising from ~800 visits per day this time last year to ~2,600 visits per day over the past week. Growth has came from every one of the top 25 markets.

6 May 2020

A 2 year old post of Luskentyre beach suddenly began trending again on social media around the Scottish audience, resulting in a peculiar peak for Scots on Sunday 26 April that wasn’t replicated in other markets.

6 May 2020

The marketing teams at VisitScotland continue to play a key role in keeping Scotland top of mind with potential visitors of the future; and supporting our intermediary partners in destination training and planning new tours to Scotland. Visit our dedicated marketing response page on visitscotland.org, which will be updated regularly. Latest updates include:

• information on how we’re working with intermediaries across our key markets• An update on the PR coverage we’ve achieved in key markets during the current situation,

and information about the stories the media are interested in• Detail about the content we’ve been developing for the different phases of recovery

Objective:Keep yourself and Scotland safe

Messaging:Dream now, travel later

Activity:All paid and social activity pausedMessages of support to intermediariesIndustry support priority – new pages on VisitScotland.org

Objective:Reconnecting Scots with Scotland

Messaging:‘Only in Scotland’Scotland: Day tripsUK: Start planning tripIntl: Inspiration

Activity:Domestic day trip inspirationIntermediary destination training & content sharingPR inspirationVideo distribution via YouTube (UK)

Objective:Increase demand for short notice Scotland holidays

Messaging:‘Only in Scotland’UK: Book your tripIntl: Start planning your Scotland trip

Activity:UK & Intl inspirationVirtual intermediary workshops / webinarsPR inspirationVideo distribution via YouTube (UK/EU)UK campaignContent partnerships

Objective:Increase demand for 2021 Scotland holidays

Messaging:‘Only in Scotland’Book your trip to ScotlandMarket prioritisation

Activity:Virtual intermediary workshops / webinarsDestination training events Media fam trips / PRVideo distribution (YT)Campaign activityContent partnerships

Objective:Keep Scotland top of mind, build advocacy & trust

Messaging:‘Only in Scotland’Dream now, travel later

Activity:Absence video / socialArmchair travel –virtual tours on VisitScotland.comActivity to engage / inspireIntelligence gatheringVisitScotland.org extendedMarket/audience insight webinars for industry

6 May 2020

VisitScotland has published this report in good faith to update stakeholders on its activity. VisitScotland has taken all reasonable steps to confirm the information contained in the publication is correct. However, VisitScotland does not warrant or assume any legal liability for the accuracy of any information disclosed and accepts no responsibility for any error or omissions.Images: © VisitScotland

VisitScotlandOcean Point One94 Ocean DriveEdinburghEH6 6JHT: 0131 472 2222business.communications@visitscotland.comwww.visitscotland.org

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