Making Travel Connections - Insights on the American Traveller in Canada
The importance of the tourism sector to the Canadian economy cannot be overstated. The industry generates an estimated $100 billion a year in revenue and directly employs one in 10 Canadians.
As impressive as those numbers are, the sector has plenty of room to grow. The challenge, however, will be to determine where that growth is going to come from and what type of investment will be needed to attract those visitors.
One of the main challenges for the travel and tourism industry is they lack the proper data to compile a robust and comprehensive profile of their guests. Without these data, the sector lacks a clear idea of where visitors are going, how long they are staying or what types of travel experience they’re looking for. As an example, while airlines, hotels and car rental companies have rich information about their customers, they have a limited view of the visitors to their markets who are not using their products or services.
To fill this void, some companies occasionally turn to visitor intercept surveys or visitor count data. But these approaches are not only time-consuming and expensive, but they can also leave many important questions unanswered.
Targeting American travellers
VisitorView was developed to answer these questions about the most important market to the Canadian tourism industry: the United States. VisitorView identifies which Americans have a high propensity to visit Canada, as well as which tourist regions they are most likely to visit.
By profiling these visitors, the tourism industry can identify their preferences, behaviours and spending capacity. Not only will this allow marketers to target American households that are most likely to visit specific Canadian destinations, but it will also allow tourism operators to reach potential visitors who participate in particular activities, such as skiing, camping or shopping.
For instance, with these insights, mountain resorts will be able to identify which American skiers are most likely to visit Canada. Not only will this allow those resorts to sharpen their messaging, but it will also enable them to target the best prospects across the U.S. at the neighbourhood level. By targeting their marketing, these reports will allow them to lower their marketing costs because they won’t have to connect with as many people to achieve the desired response.
To ensure those messages reach their target audience, VisitorView can be linked to other databases to describe the media preferences of the major consumer segments by market. This will allow the travel and tourism industry to optimize their media buying strategies.
How VisitorView works
This innovative solution combines aggregated, anonymous and privacy-compliant mobile location data, which is collected from devices held by Americans, with advanced geodemographic projection techniques and segmentation systems. Our estimates are calibrated using Statistics Canada’s International Travel Survey, as well as the agency’s Frontier Counts of U.S. overnight person trips to Canada.
The result is a dataset of American neighbourhood-level estimates of overnight American visitors to Canada, the provinces and territories, or one of Canada’s 85 tourism regions as defined by Destination Canada. In addition to the number of overnight visitors, the dataset contains estimates of overnight trips and the number of nights spent, which help organizations measure the economic impact of these visitors. VisitorView is updated quarterly to track seasonal effects to help the industry develop strategies to attract more visitors during off-peak periods.
While this resource can serve as a benchmark for the travel and tourism industry, VisitorView can also be linked with additional demographic and behavioural data to help the industry make more informed decisions that will fuel future growth.
The real power of VisitorView comes from its ability to profile those visitors. When combining VisitorView with Claritas PRIZM® Premier, the leading consumer segmentation system in the U.S., we find a core group of 23 out of a possible 68 segments accounts for 57% of all visitors to Canada. Put another way, one-third of the U.S. population accounts for almost 60% of the visitors to Canada.
While these 23 segments share a fondness for Canada, these segments are quite distinct. More than half of American visitors can be linked to mature or older segments with average to above-average income levels and live in urban, suburban and small towns. These are consumers who load up at Costco and wear clothes from Chico’s and Kohls. In their spare time, they enjoy attending live events, like the theatre and cheering on their favourite Major League Baseball (MLB) team.
More importantly, these mature and older families have an average household income of US$93,976 a year, which allows them to travel. The Muskokas and Parry Sound region in Ontario is one of the more popular Canadian destinations for these visitors, particularly for those living in the northeastern U.S. Typically, American visitors to the province’s cottage country usually lasts between six and nine days.
At the same time, about 30% of visitors come from more affluent family segments who reside in suburbia. With average household incomes of $101,671, these families gravitate to the large CMAs like Vancouver, Toronto and Montreal at almost twice the rate of the average American visitor. The remaining 20% of this core group of visitors to Canada come from young, urban and upwardly mobile segments.
For improved targeting, VisitorView can further profile these segments based on media consumption habits, as well as the types of activities they like to participate in while visiting Canada. For instance, traditional media continues to be the best way to reach mature or older segments. These families listen to CBS News radio and recap the week by reading the Sunday New York Times on the weekend.
Canadian tourism destinations looking to raise their profile may want to pay attention to awards season since this audience over indexes for the red-carpet spectacles on TV. It’s worth noting that these families don’t commute as much, which makes out-of-home ads less effective for this audience.
Similar insights are available for the other target segments as well. The on-the-go lifestyles of younger consumers, for instance, makes them receptive to outdoor transit ads. As a sign of their love for travel, members of this younger segment flip through Hemispheres, United Airlines’ in-flight magazine at particularly high rates. Meanwhile, the more affluent of the three target segments read The Wall Street Journal and consume everything sports. They also go to the movies, meaning tourism companies have the chance to wow them on the big screen as they are just starting on their popcorn.
The Canadian tourism industry is alive and well. VisitorView helps make it stronger.
Larry Filler is a senior vice president and leader of the Tourism Practice at Environics Analytics.
Click here to download the full report "Insights on the American Traveller in Canada".