The economic benefits of a tech-first traveler safety strategy

As Thomas Goetz once famously wrote, “Feedback loops provide people with information about their actions in real time, then give them a chance to change those actions, pushing them toward better behaviors.” And nowhere is this notion more apparent than the global travel industry - one of the largest and fastest-growing industries in the world.

The global travel ecosystem is more than just an economic sector. Including indirect contributions, travel and tourism accounts for a staggering 10% of global GDP, or more than $8 trillion, according to the World Travel and Tourism Council.

According to the World Economic Forum and Accenture’s Digital Transformation Initiative, tourism safety is a foundation of industry growth. Referred to as “Ubiquitous Tourist Safety,” traveler confidence and well-being, both at the point of trip planning and during travel, is consistently found to be one of the key drivers for the upward momentum.

Industry research reveals that the more confident, knowledgeable and empowered a traveler is, the better the travel experience. Better yet, when empowered with localized safety information, travelers are more likely to repeat the experience, recommend destinations and travel to more locations. Underscoring the impact, that behavior has a direct effect on tourism economies and tens of millions of jobs, and communities, worldwide.

While travel can open the door to exciting and extraordinary situations, travelers must be aware of potential pitfalls. It is smart to be informed and prepared, especially in less familiar destinations or those with relatively less stable environments. However, many risks can be characterized as either localized or isolated, and to the less informed traveler, perceptions of danger or risk may indeed appear closer than they really are.

The result can trigger a cascading series of negative impressions that can have far-reaching consequences for tourism destinations and for local economies. Yes, red zones do exist, and bad things happen all around the world. But travel should not be avoided due to broad apprehensions surrounding a more narrow destination.

Take this New York Times article from 2015 as an example. A series of Western travel warnings issued after a round of violence in a remote coastal area was a significant part of the reason, according to Kenyan officials, for the near-collapse of Kenya’s entire coastal tourism industry. And why not? For travelers relying on government advisories on which places are safe and which are not, hearing about a “war zone” can most certainly be described as an effective deterrent to travel to a region or even an entire country.

It is incumbent on government advisories to alert travelers, but the unintended side effects can be devastating. Previously limited in scope or ability to provide contextualized or localized information, government travel advisories adversely impact country and regional economies. Sadly, Kenya has not been the only impacted economy.

Another prominent example of generalized views creating inadvertent problems across wide areas was during the height of the Ebola crisis in 2015. Travelers canceled trips to South and East Africa, when the epicenter was West Africa, over 5,000 miles away.

Moguls and influencers, such as Virgin’s Richard Branson and Bill Heinecke, CEO of Minor Group, have recognized the problems caused by blanket travel advisories and have been vocal about their negative impact. In Branson’s words, “This is effectively a ban on travel, rather than leaving people to make up their own minds after being given all of the information.”

Can technology and media help solve such problems? Imagine millions of travelers and citizens equipped with smartphones, sharing their own views of safety conditions on the ground, in real time. Those aggregated insights, when distributed to the tourism industry, stimulate more travel because uninformed, less aware travelers who only believe what they consume in the media likely have a different, often pejorative, opinion of a destination than those empowered with localized safety insights.

Boosted tourism is possible because of the ability to narrow the gap between a negative perception of safety around a generalized area and the objective reality, provided in part by users who live in and know the safety of his or her community.

While travel can open the door to exciting and extraordinary situations, travelers must be aware of potential pitfalls.

Michael Becker - GeoSure

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Travel risk is relative to location. Quantifying safety at a level that goes beyond the country and city level, granular down to the neighborhood level, and making that information available to travelers is one solution. Further, expressing safety in a way that empowers travelers with the safety information they need, instead of heightening anxiety, enriches the travel experience and keeps people traveling again and again.

The economic effect on countries and cities from tourism is remarkable. Destinations with blemished reputations, which happen for a variety of reasons, can lead to a decrease in the number of visitors. But destinations have the ability to help change the narrative. They can lead safety promotional initiatives aimed toward altering perceptions and highlighting traveler well-being in order to attract an increased number of visitors and improve the local economy.

One method for evaluating the contribution of tourism revenues to the local economy is the Regional Input-Output Modeling System (RIMS) method. The RIMS model calculates the economic impact of tourism on a destination as a function of the number of tourists multiplied by the average spend per visitor multiplied by a “multiplier effect.”

The multiplier is complex and includes amounts of how much of the supply chain is local, how much is distant, salaries, tax rates, etc. The multiplier is never near zero and will exceed 1.0 when secondary economic activity is stimulated. For instance, the multiplier for Miami is 1.76, Puerto Rico is 2.08 and Turkey is 1.52.

Imagine a forward-thinking destination organization launching an innovative tourism campaign based around safety stewardship. Using the RIMS method as an example, if visitors to Puerto Rico spend $2,000 on average, for every additional visitor that a safer city would attract, an additional $4,160 ($2,000 x 2.08) in economic activity would be produced.

An increase of just 10,000 visitors per year would result in an increase of $41.6 million in economic activity, and an increase of 100,000 visitors would result in an increase of $416 million. This hypothetical example, even for large destinations, moves the needle.

Beyond the spectacular volume of tourism economy jobs and capital, what about engaging communities? Individual safety consciousness, or “safety ethos,” can elevate safety awareness in our cities and neighborhoods. That mindset can improve community safety and allow locals to participate. That helps local economies, jobs and capital flows, enhancing city and country reputations, which leads to increased tourism - all in a positive feedback loop effect. Taken one step further, imagine if that community progress can be measured.

In the end, through the combination of media, the tourism industry and advances in technology, such as a mobile application that drives higher safety awareness down to a granular neighborhood level, the power of the positive feedback loop fuses with real-time insight to promote improved safety and traveler confidence, ultimately enhancing the economies of tourism destinations and cities around the globe.