Media, Money, and the Future

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As we learned in our research, Americans are undoubtedly aware of the current economic struggles. And large companies aren’t oblivious to this either. The reminders pervade media forms of all kinds: newspaper headlines, popular rap song lyrics, credit card commercials, etc.

Although we focused on different American industries, we have all seen how companies of every kind are riding out the recession and applying new technologies. During these tough economic times, these new media features are especially critical tools in getting American consumers excited about spending money. Businesses in every industry – travel, food, music, sports, and movies – are aware that Americans are surfing the web, and they are more than willing to take advantage of this trend: from P2P music sharing to Burger King video contests via their official website and everywhere in between.

mass media

We are in the digital age, and the truth is, companies and organizations need to realize this if they want to survive in this suffering economy. As technology rapidly evolves and changes, so too do trends in mass media. The shift to an increase in digital media means a shift to a digital economy. Most of us can take care of our bills and banking online – now it merely seems like numbers on a computer screen rather than your life savings. But companies are relying on this in an attempt to survive. They use digital technology to advertise how easy-to-use their products are, making them more appealing to a mass audience.

As you have read, the different industries all play a vital role in the economy. While each one is individualized, it has its own niche. This example of demassification shows the fragmentation of American society and how there are varied interests among citizens. Some are music lovers, some love to travel, and some Americans just love to eat. Even though there is demassification, there are also new conceptions of community. Our separate interests allow us to join new groups where we can interact with those who share our same values and interests. Blogs allow for followers and others to share their ideas and experiences. Music lovers can use sites to talk about the newest music releases, and food lovers can write about cheap new finds. These new communities allow for convergence of media sources. YouTube has been a huge success for advertising for all industries, along with social media sites for the younger generations.

Social Media Bandwagon

Despite the distinctive qualities that separate our industries of focus, they are all united and affected by the economy and media. No matter how creative or scientific a company might be, they can never predict just where technology and economics will lead society next.

As shown in our study of media in the American economy, all of these industries seem to be hovering toward a complete switch to digital media, be it for advertising, accepting consumer response, for convenience and accessibility, or even security. Even though we cannot predict in what direction society will go next, it is clear that most industries are banking on a digital market to bring (or keep) them out of the hole.

Travel’s Future

200506311-001As we all know, the travel industry was hit hard by economic downturn. Jobs were lost, airlines filed for bankruptcy, and families stopped going on vacations. All of these aspects have changed the travel industry for the time being. These startling numbers seems drastic at first, but when you consider the travel industry it is an expansive industry that also effects other industries. Here is a look at some if its current impacts:

Impact on the Job Industry and Tourism:

  • Global travel and tourism economy GDP declined by 4.8% in 2009
  • Almost 5 million jobs were lost in 2009
  • Business travel decreased by 8.0% and travel & tourism investment declined by over 12%
  • Tourism provide the US with $142.1 billion from international visitors and $29.7 billion is generated from travel trade surplus in the US

(Information courtesy of World Travel and Tourism Council)

Future Growth?

  • Emerging economic countries are expected to be a new source of growth, increasing  international travel; China alone set to provide almost 95 million visitors  by 2020
  • Innovation by the travel and tourism industry will create new products and markets increasing the appeal to travel
  • Travel and tourism is forecast to grow 4% per year between 2010 and 2020
  • This growth will support over 300 million jobs by 2020

(Information courtesy of World Travel and Tourism Council)

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There is hope for the industry! This is good news for an industry that employs so many people and contributes to almost all aspects of the economy. According to the US Travel Association direct spending by resident and international travelers in the U.S averages $2.1 billion a day, $88 million an hour, and $1.5 million every second. The travel industry is huge, and we are ready to see it it prosper again!

Airline Merging Help or Hurt?

As today’s economy has its ups and downs the airline industry if constantly fighting to gain loyalty and support. This is something that is hard to do when flights are constantly delayed, service is bad, and flights have to be re-directed on a daily basis. The industry itself has to juggle increased prices in fuel and costs for maintenance and repair. These increased costs end up being pushed on the customer.delta.logo

In January Delta and Northwest decided to merge to create world’s largest airline. This can be seen as a threat to the airline industry or a helpful start. Many are worried about a monopoly forming resulting in higher ticket prices. The Los Angeles Times states:

“The pact came amid one of the industry’s most tumultuous periods as three airlines collapsed in one week”

so hopefully the companies will look out for the interest of the customer. Dana Hobart, an aviation law expert at the Los Angeles firm of Hennigan Bennett & Dorman says:

“For the two carriers, this merger is a very important step to keep from going out of business,” said . “But for the flying public, it’s not so good because there will be reductions in routes and services.”

Northwest_Airlines_airplane_4c42.JPGAs travelers, we will have to wait to see how the consolidation effects us. Both of these airlines have varied routes meaning lots of consolidation for flights. But maybe there will be good out all of this. US Airways CEO says the airline industry is extremely competitive and its fragmentation causes it to not be profitable. So maybe mergers will help customers during this difficult economy!

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This video shows customers mixed opinions with the new merger!

Online Travel

20070619_expedia_logo_18Planning your next trip? Do you first open up the internet browser and google cheep flights? Or log into Expedia or Travelocity and plan your flights, rental cars, and hotel all in one? Today, technology and increased internet capabilities travel online has become fast, easy, and cheep. All things us Americans are looking for now! We have a limited attention span so the travel industry has to keep up with our habits. Meaning they have to constantly adjust to our changing ideas and demographics. User friendly websites  help the everyday customer. According to Biz Travel Trends the demographics of Americans have changed significantly over the last ten years:

“In part, this shift in demographics is attributed to the ease of technological accessibility. According to the census bureau, 42 percent of Americans have a computer with internet access in their homes”.

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Internet technologies and its effectiveness have driven the convergence trend. We should now expect online travel searches to be commonplace. People love the fact that they can see pictures of hotels, read reviews, and book their reservations all at the same place. Also, these websites connect directly with the hotels and airlines to get you the best deal! Travel agencies are marketing to the customer:

“A strong impression(of the site) translates to repeat business. The millennium travel trend equates to a forward-thinking corporation continuously evolving alongside swift marketing strategy and implementation…”

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According to the U.S. Travel Association the internet was used by about 90 million American adults to plan travel during the past year .  76 percent of these were online travelers planning leisure trips online. Most online travel planners are somewhat or extremely satisfied with their experiences when using the internet to plan their trips. Also, many see the internet as a very useful or essential tool for planning many aspects of a trip. The internet makes travel easy and cheeper!

Worth the tank?

high-gas-prices-photoHow many times do you fill up your tank of gas? Most American’s fill up their cars at least once a week. Between daily commutes, errands, and vacations we use our cars all the time. A Professor from the University of Southern California has investigated how the price of gas effects our spending habits. In the short run we could:

– eliminate driving vacations

-carpool or ride public transportation

-buy cars with better gas millage

But all of these options are either expensive or inconvenient. That is why we make cuts in other areas:

“In 2007, Wal-Mart estimated that the then current higher gasoline prices take away $7.00 per week from an average family budget. Since then, this figure has certainly increased significantly”.

It is clear that gas prices effect consumer spending. Instead of cutting back on gas consumption, we cut back on eating out, vacations, and entreatment, and shopping:

“Some economists estimate that for every one cent increase in the price of gas, spending in other areas will decline by one billion dollars”.heavy-traffic-i95

Our reliance on gas shows how we narrow minded we are. We are willing to hurt all the other industries just as long as we don’t have to give up driving. Other industries are feeling the effects too. Consumers are noticing higher prices in grocery stores because the goods have to be transported. Warehouse stores or discount retail stores are seeing more action. Consumers want to get all their shopping done at one place for the best price possible.  Gas prices effect everything!

Cyber Travel?

plane-travelThe current American economy has had its ups and downs causing many to not afford traveling or vacationing. Also, the airline industry has taken people on a new ride. Its rough take off since 9/11 has ricocheted into other travel industries.  All of these problems have affected how the travel industry promotes itself.

Technology has changed the face of advertising. Before, a local travel agent would advise about your next vacation. With internet anyone can research for their vacation in the comfort of their home. Also, you don’t have to pay someone to do that work for you which is why travel agents were the first to go when families and individuals started cutting out unnecessary costs. In Ulrike Gretzel article for the Journal of Travel Research he explores how the web is the future for advertising. Companies are creating blogs where people can write about their experience and even upload photos! Marriott International has used this idea and started Mr. Marriott’s blog. However, Gretzel states that because technology changes so quickly:

“It is difficult for most marketing organizations, to keep pace with the evolution of new technologies…, the changes in the consumer market, and growing competition due to increasing globalization”.

Globalization is due to the fact that  boundaries can be hopped quickly and easily. Allowing individuals to form their own communities  based on travel interest or destinations. Travel corporations are experimenting  how to appeal to interest groups by attacking it with many different advertising strategies like search engine optimization and banner ads with Google. How are these strategies going to play out? Get ready for the ride!