Paul Tumpowsky, CEO of Skylark, was interviewed by editor in chief Arnie Weissmann for his thoughts on what 2019 might bring:
For U.S. travelers, 2019 will be a big year. The world is continuing to sort of hate America but love Americans as they travel worldwide, and a strong dollar is helping a lot. Younger travelers are traveling farther. They're free agents in the sense that they're willing to fly on a lot of different carriers.
We're seeing a lot of interest in the secondary markets in Europe, like Portugal, and people who have already done Portugal, they're pushing toward the Azores. There's a trend toward adding on. Someone who has always wanted to see London or Paris will also add Malaga [Spain]. Or in Japan, people want to cover their bases in Tokyo and Kyoto but then add a couple of days in a ryokan
Increased connectivity and long-haul aircraft have even made places in the Indian Ocean a bit more accessible. Hawaii, from the East Coast, is more accessible. You can go to Kennedy Airport tomorrow at noon and be in Nairobi at 10 the next morning. It's just getting easier to travel, and it makes the world a smaller place. And something as simple as a $10-per-day international phone plan enables people to be in communication for less as they're traveling around the world.
The notion of the Instagrammable picture comes into play, even during client travel planning. People don't realize that they're going a very far distance to take a single photo and that some destinations are not exactly as they appear in pictures.
Another way the world is getting smaller is that things are getting standardized. You can do your workout on vacation, and it will be like home. Everyone has the same USB plugs. It puts people more at ease as they travel farther.
As the big-name U.S. luxury brands expand internationally, they're betting on U.S. customers versus other countries. All have hotels that are being built, opened or acquired. Everyone from Aman to Four Seasons to Belmond are showing us maps with "opening in 2019," "opening in 2020," "opening in 2021."
The luxury space is more insulated from economic downturns than the rest of the market. Maybe they fly to Europe in business and home in premium economy in a downturn. Unless we're talking something really recessionary, which I don't foresee in 2019, unless there's a catastrophic world event, our customers are spending on vacations.
[As far as destination trends go], smaller, off-the-beaten-path properties in New Zealand are what's catching my eye. And I'm really interested in South America. Patagonia and the Atacama region are going to continue to be really hot. With Latam merging all these South American airlines, air coverage from the U.S. is going to be really strong, and it'll be much easier to move around the continent.
And Dominica. It's never had a luxury hotel, but by the end of the year, there will be a Kempinski, an amazing property. It'll be interesting to see whether building a first-class, luxury resort from scratch on some of these islands will build into something special. I think the answer is yes, and I think it will put Dominica on the map quickly.
We're the only true hybrid [online-offline] agency. We put a lot of work into making sure a client can book online, but our agents fully support them and help them along the way, whether on the phone, by email, text, chat or any way the clients use.
We're four years old. In 2017, we were up 265%, and if we finish December strong, we'll be up 300% in 2018. We see significant growth next year.
I think OTAs, because they've diversified their products, are going to continue to do well. Selling travel is about understanding the customer journey, not just selling [discrete] products. They're going to have some challenges ahead to make sure that components work well together, but I don't see any reason why the big OTAs would see weakness in 2019. They have a role to play, and I think they are providing good service for customers. Otherwise, they wouldn't be as successful as they are.
Likewise, I don't see any reason why traditional luxury travel agents will not do well with their existing clients. Our research has shown that it's very difficult to convert a luxury traveler away from an adviser if they have a relationship of several years. Providing those existing travelers continue to travel, the agencies that support them will continue to do well. In the long run, do I think that business will change? Yeah, I do, that's why we're betting on our business. But for decades, travel agents have done very well defending their client base, and I don't see that changing in the near-term.