The millennial generation—those born between 1980 and 2000—are today’s youngest working segment. They are also set to become the largest, comprising an estimated 75% of the global workforce by 2030. For brands across the globe, millennials are a vital generation to understand and connect with, and I believe they are even more influential in the Middle East, where they account for a quarter of the population. Across the GCC, millennials tend to be higher spenders than their global peers, and travel is a particularly popular and motivating sector for millennials, especially those in Saudi Arabia.
In the Middle East, millennials from Saudi Arabia spend two and half times the global average on a typical trip and this trend is set to continue. Due to an affinity to spend massively, the millennials from the Kingdom value travel related benefits and rewards, such as hotel upgrades and discounts. The same applies for U.A.E. millennials who like to plan trips in advance but tend to have a more cautious outlook. Interestingly for U.A.E. millennials, accruing Air Miles is a compelling attraction and often a deciding factor in how they spend on travel online. The region’s travel industry is feeling the punch of their spending power and it is estimated that millennials from the Emirates will generate $40,000 in average annual gross income by 2019.
It’s important to note millennials are not one homogenous group. There are disparities in behavior between millennials in different countries; Saudi millennials claim to spend twice as much time as their U.A.E. counterparts in searching online for products or viewing social media. Also, there are disparities between younger and older millennials within the same country.
Millennials have grown up surrounded by and adapting to hightech gadgets, the internet, social networks and being plugged in 24/7. They are endless explorers, prone to taking last minute trips, always looking for the best deal and with almost half of them booking travel through mobile devices. Indeed, travel apps have become the millennials’ preferred method of interacting with brands, almost 1/3 more than past generations. As the demands of today’s ultra-connected traveler evolve and increase, travel providers have an opportunity to leverage mobile technology even more to enhance the end-to-end travel experience, make their journey more seamless and ensure they stay connected to the traveler throughout their journey. Smart travel brands will continue to look at how mobile can help bridge the gap between generic experiences and ones where the end-traveler feels truly engaged and supported.
Millennials are also prolific business travelers, and the Middle East has a very competitive business tourism product. When it comes to the travel industry and how people book their business trips, the smartphone was a game-changer for business travel. Connected business travelers now have access to real-time information and assistance on-the-go. The GBTA has re-ported in its annual survey that 64% of business travelers check their travel itinerary via their devices whilst on the road and this figure is 77% for millennials; they have embraced these options more than other age groups. Airlines and travel agents across the Middle East understand they need to create engaging and revenue generating multi-channel services that support their travelers across all touch points. Many leading airlines in the region have launched successful travel apps which deliver innovative digital travel solutions for their travelers, improving the travel experience.
As travel services are being increasingly integrated and inter-woven together, the future competition for business travel will take place at the juncture of booking travel products, providing real-time help and assistance along with payments and loyalty. Millennials value trust and love a personalized travel experience. In fact 60% of millennials are likely to upgrade their travel experience by purchasing in-flight services to feel valued and have a bespoke travel experience. For the industry this means unbundling their services and empowering travel experiences. In summary, millennial travelers want a customer driven business model, so airlines and travel agents across the Middle East need to meet the demand for personalization and tailored offerings and create benefits that reward the way millennials want to travel, such as innovative, next generation loyalty programs. Millennials are self-reliant and therefore, businesses must become digital by default to improve interactions and trust with millennials.
Rabih Saab is president and managing director of Europe, Middle East, Africa and South Asia at Travelport.