Analysis and forecasting for summer 2021
March results for mountain and city destinations
However, let us first take one step back and analyze the final results for mountain and city destinations for the month of March, in comparison with prior months.
These graphs basically show us two things: in line with the epidemiological trend, February was the best month of the last period, due to a predominance of “yellow zones” (therefore lower risk and less travel restrictions) within the national territory; conversely, there was an inevitable decline in March, following an increase in the contagion rate and the reinstatement of orange and red zones (therefore more restrictions) in almost all of Italy.
However, the drop in March was much more conspicuous for properties located in mountain destinations, clearly those that decided to remain open during the winter season. Movement restrictions imposed on orange and red zones caused a dramatic drop in leisure demand, and mountain destinations are largely dependent on this segment.
The cities (from Milan, Rome, Naples, Turin, to the smaller ones) were able to withstand the blow, in spite of everything. This is due to the fact that city properties continue to perform fairly well in this period and achieve economically sustainable results (with peaks of up to 100% occupancy on weekdays) mainly thanks to the individual and transient business segment (the conference and MICE segment is clearly reduced to zero), that continues to move and travel for essential purposes, in spite of everything and regardless of the color classification of a specific region.
This is partly also due to the so-called “third segment”, that is, the category of people who stay in a hotel for purposes not strictly related to work or vacation, but which in any case fall within the permissible reasons for self-certification.
This trend is likely to recur in April, as well.
May-October trend for seaside, mountain, lakeside, city destinations
Let us now analyze the situation (as of 22 April 2021) for the next months, from May to October, on the four reference clusters – seaside, mountain, lakeside, and city – and the changes compared to our last survey from a month ago.
This last graph shows that occupancy has increased on all clusters and for all months, compared to the survey that we conducted a month ago.
This basically means that, despite current restrictions and the constant climate of terror conveyed through the media, people are undauntedly continuing to book their summer getaways, with the unrelenting desire to travel and the optimistic belief that free travel will indeed be possible, at least domestically, as was the case last summer.
And the pick-up trend we are encountering is typical of a normal pre-pandemic season.
We are recording the most positive pick-up figures from seaside, lakeside, and mountain destinations, which in this period are booked mainly by Italians and, to a lesser extent, also by European tourists from neighboring countries (German, French, Swiss, Austrian, Slovene, etc.), in line with what we saw last summer.
City destinations are still underperforming on wider-ranging booking windows, mostly getting by on domestic business customers with a 1- or 2-day booking window, as was also the case in prior months.
From June onwards, we still see moderate growth for city destinations, which becomes more apparent from September, at which time it is expected that increased global immunization and immunity will lead to a resumption of unrestricted international travel, as well as major events and fairs.
In principle, the data we are seeing today means one thing: assuming that the epidemiological and health situation from June onwards will be much better than the present one (both due to the elderly and vulnerable groups having been vaccinated, thereby bringing the number of deaths to zero and reducing hospital admissions, as well as the natural immunity of millions of people who have already contracted COVID-19 and have antibodies, and the temperatures and outdoor spaces that should facilitate a natural slowdown of virus circulation), hoping that politicians do not have new unpleasant last-minute “surprises” in store for us, with favorable weather conditions the coming summer promises to be the best one ever for seaside, mountain, and lakeside destinations.
All the more so, given the massive desire of people to make up for lost time after being homebound for so many months and having “missed” a winter (in the case of mountain destinations).
But it will also be a summer of strong recovery for city properties (as was indeed the case of last summer for those who bravely chose to remain open by adopting the correct sales strategy and achieving excellent results), and which will lead to the long-awaited return to normal pre-COVID-19 performances (occupancy and ADR) from September onwards.
The reason why we are inclined to be optimistic, politicians permitting, is that this summer we will see, aside from Italians, many more foreigners. In fact, we are seeing a fair percentage of bookings from EU European, British (from June onwards) and American travelers (from August onwards).
The introduction of the Green Pass (which will allow European citizens to travel freely within the EU by proving that they are vaccinated, have tested negative to the COVID-19 test, or are immune after having recovered from the virus) will certainly contribute to boost EU-originated pickup.
Then, we have British and Americans travelers who are undoubtedly the most active in the world in terms of reservations, also thanks to the excellent results achieved with their vaccination rollout, the gleams of hope provided by their governments and health authorities concerning the possibility for vaccinated people to travel abroad with no restrictions upon their return, the resumption and increased frequency of medium- and long-haul flights from June onwards (with the introduction of so-called COVID-tested flights), and the reasonable financial subsidies distributed to help the categories most impacted by the pandemic and relaunch the economy.
Being able to finally welcome Americans back this summer is a breath of fresh air which will mainly contribute to the recovery of art cities, and is partly due to the fact that Americans have never been imposed any actual and strict lockdowns since the start of the pandemic, and have continued to travel and spend the holidays within their country for over a year.
So, it is understandable that many of them (especially those who are vaccinated, almost 130 million to date) will want to experience once again the pleasure of traveling overseas to enjoy something that cannot be found at home. From this point of view, Italy has clearly always been one of the preferred destinations. And the booking dynamism that we are seeing from American travelers for the coming months is further confirmation of this.
We expect this growing trend to become increasingly evident next month (thereafter witnessing an overwhelming and unstoppable avalanche of reservations from June onwards, as was the case last summer), and we will keep you updated in our next report.