Are all consumers price sensitive to travel agencies services in Hong Kong?

A recent study conducted by Chill Creative Company found that there is a segment of the generation Y market in Hong Kong that are willing to pay more for travel agency services.  However there are certain conditions to this.  In the study over 90% of respondents were aged between 24-33 years old with over 40% of them travelling at least 3 times a year.  When asked about how they prefer to buy the services of a travel agency, almost 70% said that the store environment is quite important for them.  In our focus group interviews, we found that the generation Y find it ‘fun’ to go out with their friends and sometimes walk into a travel agency to plan their trips together.  Most said they will normally choose package tours but about 40% said they preferred just getting hotels and airline packages to they could plan their own tours. 

Over 53% of the respondents said that many travel agencies do not have user-friendly websites.  Many of the young generation said that they would prefer more functional websites and do not like the many pdf pop ups that come up so often.  Although there was some satisfaction of the services in they industry, most said they were just ‘satisfied’ which meant they were not loyal to the travel agency and would shop around for better services.  Another major concern of the younger generation was the way travel agencies provide information.  They felt that staff needed to be more polite and willing to answer questions.  The key value of providing such a service is the advice the customers get from the travel agent.  In essence, the customer is being given some level of consultancy and social interaction is of utmost importance.  However overall most customers are not loyal to the brands and just go ‘travel agency shopping’ regularly as they don’t find any specific one they are attracted to for the long term.  When asked if they would pay more for a better service, a strong 61% of this market said yes they would.  And overall this would also lead to higher levels of customer loyalty meaning the company could spend less to target new customers.

There is therefore a large segment that wants to be loyal to one travel agency and won’t therefore be price sensitive.  However in order for them to be loyal - they value a better website, more brand recognition, better service quality and more ‘attentive’ staff. 

Chill Creative Company can help you to achieve this with your consumers in an affordable way leading to a higher return on investment.  Visit our website www.chillcreativeco.com for more information.

Case in point – the ‘youth’ dynamic in the new virgin advertisement campaign

‘Flying in the face of ordinary’

Photograph source: David Paul Morris/Bloomberg

Although a cheeky use of the storyline of superheroes and of the corky ‘saving us from the bland, the beige and the common can’t be bothered’, Virgin’s new ad campaign has definitely defined the Virgin Atlantic brand in a new ‘young’ light.  In today’s murky and saturated industry, few airline brands stand out.  Virgin has always taken that ‘next step’ in building their brand to target the new generation of travellers.   In the 90s it was all about service standards when Richard Branson’s tagline was about being ‘no ordinary airline’.    When the traveller was the savvy businessman or woman and service differentiation and excellence was a key part of the value an airline could provide.  Therefore the campaign of being ‘no ordinary airline’ ensured Virgin’s brand building success in the 1990s. 

Today with the typical passenger being from the Generation Y category, people looking for more adventure and fun, Virgin has taken cues from this new mindset of consumer and reinvigorated the brand through communicating an affective value proposition.  It’s the same message but encoded to the new generation of ‘super heroes’ of travel!

For more information on how to develop a successful brand strategy, contact Chill Creative Company at +852 3695 0642.