The Brexit Story Part I: Keep Calm and Carry On
Last Thursday, just over half of the British population voted to leave the European Union.
Shocked? Confused? Concerned? Yes, and so was I. But now’s the time to make ourselves a cup of tea and consider the real consequences to the travel industry.
British author Douglas Adams explained the commercial success of the fictional Hitchiker’s Guide to the Galaxy in his absurd sci-fi novel with the now famous quote: “First, it is slightly cheaper; and secondly it has the words don’t panic inscribed in large friendly letters on its cover.”
You might not get the British humor, but you will see how Adams has inadvertently summed up the essence of crisis management for the tourism industry: price and reassurance.
Any travel company looking to sell vacations to post-Brexit Britains may be tempted to print the words “don’t panic” on its website and point out that the pound is weak against the dollar. But what do travel organizations, such as Visit Britain and the European Travel Commission, think of this major change? We called them to find out.
Visit Britain Continues its Marketing Campaign
We first contacted Visit Britain to ask for their point of view on how the destination will be affected by the Brexit vote. We got the institutional statement of: “We offer a warm welcome to our many visitors. We are anticipating a strong summer holiday season as we continue our global #OMGB ‘Home of Amazing Moments’ marketing campaign to show people why they should book a holiday. It’s a great summer to come to Britain.” Admittedly, the response didn’t answer my question, but it was a classic British case of “keep calm and carry on.”
ETC: “After Six Weeks, it Will be Business as Usual”
For the other side of the story, we phoned Eduardo Santander, head of the European Travel Commission (ETC). Eduardo, who has seen many crises affecting the industry from terrorism to taxes, was also calm and collected: “Call me back in six weeks” was his first comment. “Media storms typically last no longer than six weeks. Today everyone is talking about Brexit. Everyone is concerned and speculation and fear sell newspapers for a while. I can assure you that in six weeks’ time, it will no longer be headline news and we can get back to business as usual.”
What is business as usual for the ETC? It is funded by member countries (ETC had their own Brexit in 2011 when Britain decided not to be a member) and a grant for the European Commission. It is responsible for the promotion of Europe as a region to long-haul tourism markets, primarily in North America and Asia, who have the perception of Europe as a single tourist destination. We asked Santander more specifically if he thought Brexit would have a negative effect on the region’s perceived appeal for these long haul markets.
“Europe will not suffer as a region because nothing has really changed. We are still the safest and most culturally rich tourist destination in the world and geo-political or trade issues are not relevant to or understood by long haul travelers. That said, for certain markets, particularly China and the rest other Asian markets, Britain is less competitive as a destination without Europe. The perception is that Britain will now only offer Britain whereas a vacation to France, Spain, Italy, Germany, etc. is seen as a vacation to Europe and will offer the full variety of European culture and richness of travel experience.”
Bottom Line: No Immediate Effect to the Travel Industry
The ETC is sure that there will be little or no immediate effect to the industry. Vacations have been booked and things will calm down as the UK negotiates its amicable divorce from Europe on the best possible terms. No changes will be made for at least two years. When both parties negotiate these practical implications, it is in neither party’s interest to do anything to stop visitors traveling freely in and out, to or through the UK.
Britain is, after Germany, the largest European outbound travel market. One in five tourists on Spain’s beaches this summer will be a Brit and that is not including the hundreds of thousands of UK citizens that live permanently under the Spanish sun. Any restriction in travel between UK and “the continent” would be a disaster for both sides.
Uncertainty is bad for everyone and the British and European authorities will be working hard to dispel any sense of doubt or uncertainty about the effects of Brexit on travel and tourism as soon as possible. So the official, institutional message from both sides of the English Channel is “don’t panic.”
To be fair, there is nothing for tourists to be concerned about. If anything, the drop in value of the pound will be an advantage. However, the effect on the industry and Britain and Europe’s economies and, therefore, the analysis by the private sector industry leaders, is much more complex. These implications will be the subject of my next article after I’ve had a nice cup of tea (I am British after all).