REPORT FROM THE U.S.— The American traveler took an average of four trips during the past 12 months, spending more than US$3,500 on leisure travel services, according to results from the new Portrait of American Travelers survey released yesterday.
“We think that demand for leisure travel services is going to turn positive for the year ahead,” said Peter Yesawich, chairman and CEO of Orlando-based Ypartnership.
A slightly higher percentage of travelers (16 percent) plan to take more trips during 2010 than do those who plan to take fewer trips (14 percent). Among affluent households with an annual income greater than US$125,000, 20 percent plan to take more trips versus only 9 percent who plan to take fewer.
“The majority of that demand originates, not surprisingly, from more affluent households,” Yesawich said.
Obstacles to travel and the new resourcefulness
When asked their reasons for cutting back on travel during 2010, respondents cited a number of obstacles:
| Household budget concerns/cutting back on discretionary spending | 54% |
| Concerned about economy/own job | 39% |
| Airfares too expensive | 36% |
| Travel in general too expensive | 33% |
| Gas prices are too high | 20% |
| No time/too busy | 14% |
| Can’t get time off from work | 11% |
| Need/want to do some projects I have been putting off at home | 11% |
But such obstacles spurred by the downturn have, in turn, sparked a new resourcefulness on the part of consumers, according to Jim Taylor, vice chairman of Waterbury, Connecticut-based Harrison Group.
“People have become intensely resourceful in the way they go to market,” he said. “Cutting back is more likely to have made them feel smart and prideful than deprived.”
Of those surveyed, 86 percent agreed with the statement, “I have done a good job of making my household more fiscally responsible,” while 79 percent agreed, “I have become a much smarter shopper thanks to today’s economic situation.”
Smarter shopping translated into a number of different buying habits, such as an increased propensity to use coupons and direct offers 36 percent more often this year than last. The same goes for waiting for sales (35 percent) and shopping online (26 percent).
These sentiments converge with the arrival of new technology that allows travelers to shop even more aggressively, Yesawich said. Not surprisingly, online distribution channels such as online travel agencies and brand websites were the most commonly used methods of booking.
| An online travel agency site such as Expedia, Travelocity or Orbitz | 66% |
| A branded travel service supplier site such as American Airlines, Hilton Hotels or Hertz | 48% |
| A meta search site such as Kayak | 15% |
| A traditional travel agent | 8% |
| American Express Travel Services | 5% |
| Other | 7% |
While OTAs have been around for, in some cases, more than a decade now, a recent digital selling method has only recently gained prominence, Yesawich explained. Flash-selling, as the practice is known, allows suppliers to send a targeted group of customers a travel offer that must be booked within a relatively short window, if not immediately.
During 2009, 14 percent of respondents purchased a travel service as a result of receiving an unexpected e-mail. Of these, 38 percent purchased an entire vacation package.
“This is really quite remarkable,” Yesawich said. “You might expect someone to book a hotel room on the spur of the moment, but four out of 10 of these travelers had booked an entire vacation package.”
The practice is creating headaches for hotel prognosticators, who are finding it increasingly difficult to forecast given shorter booking windows. During 2009, 27 percent of travelers took a last-minute trip, booking less than eight days before their trips.
No green for green
While 81 percent of survey respondents considered themselves environmentally conscious, only 9 percent made travel decision within the past year based on environmental decisions. Furthermore, only 16 percent were willing to pay higher rates or fares to patronize travel service suppliers who demonstrated environmental responsibility.
“There’s not extra green for going green,” Yesawich said.
Tapping into the network
A number that’s jumped dramatically in recent years is the percentage of travelers who maintain a profile on a social networking site. This most recent survey found that measure at 46 percent, with millennials (61 percent) and Gen-Xers (54 percent) leading the pack in terms of usage.
But despite their prevalence, social networking sites had a very limited influence on travelers purchasing habits.
“When we asked those travelers to tell us the extent to which they consult content on the social sites when it comes to getting recommendations about destinations and travel suppliers, the numbers are in low single digits (6 percent),” Yesawich said.
The year ahead
Using the survey’s findings, Yesawich and Taylor drew the following conclusions about the year ahead:
- Although the Great Recession has supposedly ended, consumers don’t feel and/or behave that way yet.
- Consumers have developed greater confidence in their ability to maneuver through the prevailing economic uncertainty.
- Vacations remain a birthright, and travelers will continue to display a new resourcefulness in their pursuit of the best fares/rates.
- Family travel (including multigenerational family travel) will continue to grow in popularity as more adults think of vacation time as family time.
- Last-minute vacations will become more popular as flash sale e-mails promote more last-minute discounts.
- Travelers favor environmentally responsible suppliers but are not prepared to reward their commitment by paying them a premium.
- Travelers are active users of social media, but most do not rely on the content of these media to guide their decisions about travel suppliers.
- Demand for leisure travel should grow modestly in the year ahead, led by more affluent households.