There have years been various determinants towards travel and these constantly change based on numerous factors, including individual preferences, types of travel, convenience and availability. But, price has always been a key factor whether travelling for business or for leisure. Every proposed trip, be it a client meeting, visiting an exhibition, or holidaying at the beach has a price ceiling and we all love to get a good deal.
Travellers will continue to make value-based decisions that reflect their own personal views when booking travel, but the COVID-19 pandemic has resulted in some clear shifts in views on travel, even if they may just be short-term as we continue to face the threat of potential new infections. New research from Expedia Group reveals some of these shifts, including positive sentiment on vaccine passports, increased budgets, and an enduring demand for safety and financial security.
Expedia Group’s Traveler Value Index examines the views of 8,000 people in eight countries (Australia, Canada, France, Germany, Japan, Mexico, the United Kingdom, and the United States) to understand their values and expectations as the pandemic becomes more controlled in many parts of the world. The latest research, conducted by Wakefield Research in Apr-2021 and May-2021, projects an improved outlook for 2021 and beyond.
As vaccination rates rise and borders open across the globe, people are “ready and eager to travel,” says Ariane Gorin, president, Expedia for Business, Expedia Group. However, the months of uncertainty are “weighing on their travel decisions,” according to Ms Gorin, and shifting the conventional belief that price is the top driver of bookings. “These insights show people want to book with trusted travel providers that will deliver on their experiences, keep them safe, and protect their financial investments,” she explains.
Despite a period of uncertainty, Expedia Group’s Traveler Value Index shows that people are making travel a financial priority. More than a third (34%) of travellers have larger travel budgets now compared to 2020. In fact, nearly one in five respondents globally (18%) expect travel to be the activity they spend most on in 2021, on par with major spending items such as home renovation (18%) and ahead of entertainment (12%), buying or taking care of a car (11%), or healthcare (11%). Additionally, more than third (36%) say they would trade a pay raise for more vacation days.
But, travellers are thinking differently about the frequency and length of travel. Many (60%) are opting for domestic travel in the short-term, however they are planning to get away more often, nearly half (41%) wanting more frequent, shorter, trips. The outlook for international travel is also improving, with more than a quarter (27%) of travellers considering a trip to another country in the next year. In fact, nearly three-quarters (71%) of travellers are comfortable showing a vaccine passport to travel internationally.
The research also shows an increased desire for new and different experiences over nostalgic destinations, with three-quarters (75%) of travellers likely to select a travel destination they’ve never been to before. Additionally, more than half (52%) are likely to use a new mode of transportation, and nearly a quarter (22%) are looking for a once-in-a-lifetime experience on their next trip.
Weighing less heavily on price, travellers want to support sustainable practices, with nearly three in five (59%) willing to pay higher fees to make their trip more sustainable. Additionally, the research shows a majority (65%) are more likely to book with travel providers that have inclusive policies. This includes properties that are owned by women and/or people of colour, are welcoming to the LGBTQIA+ community, and those that are supportive of people with disabilities.
But it is financial security and safety that now rank as the highest priorities for travellers across all experiences, a shift from the conventional wisdom that price drives consumer behaviour. The Traveler Value Index shows more than one in four travellers most value the ability to get a refund, particularly for airline (26%) and vacation rental (26%) experiences, followed by enhanced cleaning and disinfection. “The results highlight a need for travel providers to clearly communicate cancellation policies and cleanliness measures to help ease any anxieties and build confidence,” notes Expedia Group.
The Traveler Value Index also shows differences in values by age group, indicating that younger groups are less focused on price and refunds. For hotels and vacation rentals, the ability to get a full refund increases in value with age. However, travellers under the age of 40 in the US and Japan rank enhanced cleaning the most important factor in hotel bookings, while also seeing more value in contactless experiences and premium benefits.
Airline travel decisions are also shaped by financial security, where more than a quarter of respondents (26%) most value the ability to get a full refund. However, millennial and Gen Z travellers, or travellers under the age of 40, see more value in contactless experiences, first-class benefits, and environmentally friendly policies compared to older generations.
North American millennials, or those born between 1981 and 1996, value flexibility in car rental decisions, ranking the ability to make changes second. The trend of North American millennials valuing flexibility is also evident in air travel, showing how the ability to change plans without penalty is worth just as much as lower pricing.
Cruise passengers from numerous countries though still rank low pricing as the top value. However, North American Gen Z travellers, or those born in 1997 onwards, rank environmentally friendly policies second in the list of values, showing that younger age groups weigh the environmental impact of their travel decisions in addition to price.
They say ‘a picture paints a thousand words’. In this regular section CTC – Corporate Travel Community offers an illustrative insight into a key industry observation or trend, this week highlighting a graphic from the aforementioned Expedia Group research that highlights that one in four travellers most value the ability to get a full refund across all travel experiences.
HEADLINE FIGURES FOR WEEK COMMENCING 02-Aug-2021:
Departure frequencies down -0.33% versus last week; up +32.95% versus 2020 and down -30.72% versus 2019.
Seat capacity down -0.48% versus last week; up +35.36% versus 2020 and down -31.70% versus 2019.