What does COVID-19 Mean for the Portuguese Travel Industry? What are the next steps?

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The world has changed. And it is changing more each day. Before COVID-19 Portugal was one of the hottest and fastest growing destinations for Americans in Europe. In late 2018 Travel + Leisuredeclared Portugal the “Destination of the Year for 2020.” TAP grew its flights from 3 gateways to 7. American travelers surpassed 1 million in 2020 for the first time ever.

According to a recent Harris Poll just 21% of Americans say they will stay in a hotel in 30 days. But some 60% say they would stay in hotel in six months or less. Big hotels, meeting hotels’ and properties with more than 200 rooms may have to wait for a vaccine to restore their market share.

Today, all TAP flights are suspended, and Portugal is in a lockdown. So, how can Portugal rebuild in a post COVID-19 world? It can, if the right steps are taken, and smart investment is made. Let’s start off with a SWOT analysis.


Strengths


COVID-19 has not impacted Portugal as it has Spain and Italy. And the country’s government response has drawn praise from American newspapers.

Portugal is the closest European nation to the US - just 4-5 hours to the Azores or Lisbon. New York or Boston to Lisbon is the same as flying to Los Angels. And the route was not dependent on the now troubled low-cost carriers.

Portugal is a mostly rural nation, with only a few modest sized cities. And, Americans were starting to ask what to see after Lisbon or Porto.

Small and locally owned hotels dominate the Portuguese market, with the exception of the Algarve. And these smaller more intimate hotels will be where Americans want to go next.

With dozens of natural parks well preserved mountains and coastal regions, very good roads and excellent rail - Portugal makes it easy for Americans to explore.

Weakness


The can’t skipcampaign was never really aimed at the US market, and made little sense to the US traveler who saw Portugal as thenext big place to go. As a result, there is no solid brand image here

Knowledge of Portugal beyond Lisbon, Porto and the Algarve is sparse - and only recently did the nation’s regions see the US as a priority market, so there is work to be done.

Americans poorly understand Portugal’s culture, cuisine and geography.

Visit Portugal is out dated and not aimed at the US market.

Opportunity:

Italy, Spain, and France are hard hit and will take a long time to recover.

There will be lots of pent up demand to travel.

Portugal is still a mostly rural nation.

Most Portuguese hotels are small and locally owned.

Threats

Other nations may rebrand and aim new products at the US market.

Domestic travel may fill the gap left by the COVID-19 issue.

It may take years to find a vaccine

Economy may not revive for years.

Sentiment in Portugal could turn against foreigners.

By the time things come back, travelers may have forgotten about Portugal.

So, now what?

Research – take the time to understand the market, where it is going, and what you should invest in to match market trends.

Brand – Your brand may be out of tune, date, or sync. Now is the time to figure that out and make the adjustments. Brands that do not adapt will fail. It is that simple. And if you just dumped a lot of money into it, mourn and move on.

Market to the new truths; don’t just go back to what worked before.

Marco-target. The age of one-size fits all is long over. Break the market down by smaller audiences, and adjust your digital marketing.

© 2020 by Louis Karno & Company LLC.

info@lkarno.com |  Tel: 1-603-224-5566

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