COVID-19 has made forecasting more important in tourism and hospitality than ever before. In this video, I reflect upon my experiences and what I have learned about forecasting during the 2020 pandemic. I demonstrate forecasting in tourism by using business travellers in Finland as a case study. See the full presentation at https://youtu.be/AfGBA4mQrXw

1. Forecasting in
tourism
Case business travel in Finland
Juho Pesonen, Head of e-Tourism research,
University of Eastern Finland

2. Sources
• Alan A. Lew, Joseph M. Cheer, Michael Haywood,
Patrick Brouder & Noel B. Salazar (2020) Visions of
travel and tourism after the global COVID-19
transformation of 2020, Tourism Geographies, 22:3,
455-466, DOI: 10.1080/14616688.2020.1770326
• Zhang, H., Song, H., Wen, L., & Liu, C. (2021).
Forecasting tourism recovery amid COVID-19. Annals
of Tourism Research, 103149.
• Shih-Shuo Yeh (2020): Tourism recovery strategy
against COVID-19 pandemic, Tourism Recreation
Research, DOI: 10.1080/02508281.2020.1805933
• https://www.mckinsey.com/industries/travel-
logistics-and-transport-infrastructure/our-
insights/for-corporate-travel-a-long-recovery-ahead

3. Topics
1. Forecasting as a skill and a
way of thinking
2. Case business travel in
Finland
3. What lies ahead?

4. 1. Forecasting as a skill and a way of thinking

5. Hindsight is
easy

6. Forecasting requires particular ways of
thinking and skills
Accept that you are
wrong, all the time.
Challenge what you
know and what you
believe in. Consider
them as hypothesis
to be tested.
Understand biases
and heurestics,
system 1 and
system 2 thinking.
Forecast
systematically and
through
likelihoods.
Learn from your
mistakes.
Update your
estimates as new
information comes
in.
Do not go solo.

7. Whoever can become a great forecaster, but it requires a lot of work.

8. 2. Future of business
travel, case Finland

9. Social media questionnaire for tourism experts,
two respondent groups.
Question (Group 1, n=55) Mean Median Standard deviation
How likely (0-100 scale) it is that business
travel in Finland returns to 2019 levels in
2021 when measured with number of
overnights?
24,42 21,5 18,6
How likely (0-100 scale) it is that business
travel in Finland returns to 2019 levels in
2023 when measured with number of
overnights?
52,3 56 24,49
How likely (0-100 scale) it is that business
travel in Finland returns to 2019 levels in
2025 when measured with number of
overnights?
63,04 64 27,82

10. The second group was provided
with additional information:
In 2019 5 276 625 domestic business traveler overnights. In 2020 3 385 026 overnights, resulting in the reduction
of 36 %.
In 2019 2 495 302 foreign business traveler overnights. In 2020 840 864 overnights, resulting in the reduction of
66 %.
Altogether in 2020 45 % less overnights from business travelers than 2019.

11. Second group
Question (Group 2, n=40) Mean Median Standard deviation
How likely (0-100 scale) it is that business
travel in Finland returns to 2019 levels in
2021 when measured with number of
overnights?
17,97 14 18,56
How likely (0-100 scale) it is that business
travel in Finland returns to 2019 levels in
2023 when measured with number of
overnights?
48,15 49,5 21,83
How likely (0-100 scale) it is that business
travel in Finland returns to 2019 levels in
2025 when measured with number of
overnights?
59,5 58,5 24,52

12. Group of hotel managers as the second sample

13. Kyselyn tuloksia, some, 82 vastausta kahteen
ryhmään jaettuna
Question (Group 1, n=14) Mean Median Standard deviation
How likely (0-100 scale) it is that business travel in
Finland returns to 2019 levels in 2021 when
measured with number of overnights?
12,31 4 26,82
How likely (0-100 scale) it is that business travel in
Finland returns to 2019 levels in 2023 when
measured with number of overnights?
49,81 50 21,86
How likely (0-100 scale) it is that business travel in
Finland returns to 2019 levels in 2025 when
measured with number of overnights?
74,35 80 21,95
Question (Group 2 [with additional information], n=17) Mean Median Standard deviation
How likely (0-100 scale) it is that business travel in
Finland returns to 2019 levels in 2021 when
measured with number of overnights?
13 8 15,63
How likely (0-100 scale) it is that business travel in
Finland returns to 2019 levels in 2023 when
measured with number of overnights?
51,29 58 25,22
How likely (0-100 scale) it is that business travel in
Finland returns to 2019 levels in 2025 when
measured with number of overnights?
77 81,5 21,84

14. Factors affecting business travel (A Fermi
problem)
Is business travel at 2019 levels in 2023?
Economic downturn / recession
COVID-19 and
new strains
Travel
regulations
in Finland
and abroad
Fear to
travel
Vaccines
Remote
work as the
new
standard
Sustainability
Savings vs lost income at
businesses
Flight
connections Avoiding travelling to stay
home
Cultural factors
Bleisure
Short haul / Long haul
Social relationships
Domestic / abroad
Travel bubbles
Travel behavior of the top 20?
Increased price of travel
Car and train
vs. airplanes
Airbnb etc.

15. Forecasting is hard work!
Not worth on trivial matters.

16. Scenario thinking
• Four scenarios
1. In 2023 at 2019 level (Domestic 5,3m; foreign 2,5m, altogether 7,8m business
traveler overnights).
2. In 2023 well above 2019 level (Altogether yli 8m business traveler overnights).
3. In 2023 a bit less than 2019 level (Altogether 6-8m business traveler overnights).
4. In 2023 well below 2019 level (4-6m business traveler overnights).
• What are the odds of any of these scenarios happening?

17. Not just the quantity
but also the numbers
• What kind of new services business
travellers need in the future?
• Will the length of stay increase?
• Does the structure of the markets
change? White collar travellers vs
workers.
• How to ensure safety in business
travel?
• Does customer loyalty change and
how?
• What are meaningful partnerships?
• How do we have to develop our
strategy to meet the future of
tourism?

18. 3. How to move forward from here?

19. Do likelihoods even matter??

20. Is the forecasting you
do systematic?

21. Kiitos!
Contact:
Juho.Pesonen@uef.fi
@eppuJ
www.juhopesonen.com
https://fi.linkedin.com/in/juhopesonen
https://uef.academia.edu/JuhoPesonen
https://www.researchgate.net/profile/Juho_Pesonen
www.uef.fi/mot
www.uef.fi/tmm