Bus and Motor Coach Library

The Changing Face of Consumers

Author - Brian J. Niddery (2004)

Without doubt, the motorcoach industry provides an extensive mosaic of services ranging from urban commuter services, intercity scheduled services, charters and tours, shuttles, contract services, air and sea port services, as well as a variety of institutional uses extending into corporate, parks and more.  In spite of a string of unfortunate events that significantly reduced tourism and business travel in general, many believe the overall need to employ bus and coach service is indeed expanding.

Within this mosaic there are a series of market dynamics at work that influence the nature of coach travel.  Most importantly this industry is seeing a change in customer demographics.  Seniors, recognized as a traditional mainstay of coach business (as a percentage of total sales) will likely show a decline over the coming decade, whereas the next generation of seniors, the so-called future seniors (ages 54-64) and the baby-boomers generation (ages 35-53) will continue to represent a growing source of business.

Changing demographics translate to changing needs and desires.  The current senior generation is relatively less traveled, whereas the next generation is comparatively well traveled and embracing greater appreciation and sophistication in both their needs and in their demands. 

Another major factor is a business world that through technology and communications has the ability to more accurately identify and target consumer groups and sub-groups, thus their ability to develop more custom-tailored products of every kind.  Today's consumers now enjoy a far greater array of choices and options.  And as product choices continue to grow, so do consumer expectations.  Add the vertical factors associated with socio-economics, and diverse cultural groups, you have the makings of a bewildering patina of consumers, a sophisticated mix of interest and pursuits with a diverse set of needs and desires. 

Whereas at one time passenger transportation was a more simplified product - fewer in number, more basic in nature and in expectations, and that appealed to a wider segment of the population.  Today, we are dealing with a growing multi-generational mix of active customers engaged in a wide-ranging plethora of pursuits.  Instead of fewer travel products enjoyed by a relatively large portion of the population, there are now an increasing number of travel related products each appealing to fewer customers.  You could say that the passenger transportation industry is becoming more boutique-like in nature.

A major outcome of this trend is smaller passenger loads. Although these factors are affecting the bus industry as a whole, its influence is being particularly felt within the tour, shuttle and leisure travel industry.  The tour industry is experiencing smaller numbers of people, shorter duration travel, and more affinity type tours. 

As we earlier mentioned, the next generation of seniors and the baby-boomers are an expanding source of new customers with greater discretionary incomes and leisure time to enjoy. Their needs and desires are quite different than the present senior generation, as they comprise a growing "affinity" market; that is people of like interests forming their own groups and creating their own specific "one-up" itineraries.  Affinity groups by nature tend to be smaller in size and often shorter in duration. In addition they demand an excellent level of service - not just good - but excellent levels of service.  Unlike the traditional coach market business of a decade or several decades earlier, today's leisure travel clientele are not interested in traveling a thousand miles to simply view the countryside.  Being well-traveled consumers, they are interested in more active and themed itineraries that are infinite in range and interest - historical and architecture, literary venues, cuisine, soft and hard adventure, sports, cultural, the arts, and so much more.
This has led to new terminology in the marketing lexicon known as "experiential travel".  This term holds a great deal of potential for the bus industry.  "Experiential" means the "total experience".  Future seniors and baby-boomers want the "experience" to begin from the moment they leave their front door until they return to their front door.  And this experiential or "totality" very much influences the way in which they wish to travel.  To start they have relatively little tolerance for "wait times" or having to stand in line at terminals or airports, or to be herded from one venue to another.  This is in stark contrast to a generation before, who were not quite so well-traveled, and where line-ups, waiting in an airport or railway station, or delays in boarding a cruise ship was simply considered as part and parcel of the overall experience.  This emerging market segment wants a continuous, relaxed, and a fulfilling leisure travel experience, devoid as much as possible of interruption or frustration.  This represents an opportunity - perhaps an inordinate opportunity - for the bus and motorcoach industry to deliver a higher level of service that is more seamless in nature. 
Recent National Tour Association (NTA) surveys show that tour operators are increasingly offering more travel packages focusing on special interests such as hard and soft adventure, gay and lesbian travel, sports tours, wine tasting, gardening and agriculture. Seniors still represent the largest customer base for NTA tour operators, yet NTA's latest research also shows that its tour operators are serving more future seniors, baby boomers, and young adults ages 21 to 34. In a 2003 National Tour Association (NTA) Member Survey, Tour Operator members were asked what percentage of their customers fell into the following age categories.  The summary results are as follows:

Student                               17%
Young Adult (21-34)              5%
Baby Boomer (35-53)          14%
Future Senior (54-64)          23%
Seniors (65 and older)         41%

Tour Operator members were also asked, which of the following types of travel packages does your company presently offer?  The percentage of members offering these types of tours are summarized as follows:
Agricultural                             24%
Alumni                                    31%    
Amusement Parks                  35%    
Cruises                                   67%    
Cultural                                  59%    
Dinner Theaters                      58%    
Ecotours                                 22%    
Events                                    58%                
Fall Foliage                             74%    
Family                                     35%    
Gaming (casino, etc.)              44%    
Garden (floral)                        55%    
Gay/Lesbian                            8%      
Grandparent/Grandchild         28%    
Hard Adventure                      10%    
Historic Heritage                     73%    
Holidays                                  63%    
Learning                                 34%    
Museum                                  68%    
Music                                      53%    
Mystery                                   39%    
National Parks                         67%    
Religious                                  33%    
Reunion                                   35%    
Science                                    20%    
Shopping                                 55%    
Soft Adventure                        44%    
Sports (golf, skiing, etc.)          26%    
Sports                                      36%    
Student                                   47%    
Theaters (general)                  65%    
Wine Tasting                           39%    

The consumer mix is changing, both demographically and in the range and types of vacations that consumers now demand.  As this market changes and evolves, it follows that your customers and your range of services must also change and evolve.