Price no longer the primary driver of travel decisions

US: New research by Expedia Group has revealed shifting views on travel, including positive sentiment on vaccine passports, increased budgets, and an enduring demand for safety and financial security.

The Traveller Value Index examined the views of 8,000 people in eight countries to understand their values and expectations as the pandemic becomes more controlled in many parts of the world. The research was conducted by Wakefield Research between 16 April and 7 May 2021.

Respondents included 8,000 nationally representative adults over the age of 18 from Australia, Canada, France, Germany, Japan, Mexico, the United Kingdom, and the United States.

Ariane Gorin, president, Expedia for Business, Expedia Group, said: “As vaccination rates rise and borders open across the globe, people are ready and eager to travel. However, the months of uncertainty are weighing on their travel decisions 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 added.

Improved outlook for 2021 and beyond

Despite a period of uncertainty, the Traveller Value Index shows that people are making travel a financial priority.

More than a third [34 per cent] of travellers have larger travel budgets now compared to 2020. In fact, nearly one in five respondents globally [18 per cent] expect travel to be the activity they spend most on in 2021, on par with major spending items such as home renovation [18 per cent] and ahead of entertainment [12 per cent], buying or taking care of a car [11 per cent], or healthcare [11 per cent].

Additionally, more than a third [36 per cent] said they would trade a pay raise for more vacation days.

Travellers are thinking differently about the frequency and length of travel. Many [60 per cent] are opting for domestic travel in the short term, however they are planning to get away more often, nearly half [41 per cent] wanting more frequent, shorter, trips.

The outlook for international travel is also improving, with more than a quarter [27 per cent] of travellers considering a trip to another country in the next year. In fact, nearly three quarters [71 per cent] 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 per cent] of travellers likely to select a travel destination that they have never been to before. In addition, more than half [52 per cent] are likely to use a new mode of transportation, and nearly a quarter [22 per cent] are looking for a once-in-a-lifetime experience on their next trip.

Decisions reflect personal values

The Traveller Value Index reveals that travellers continue to make value-based decisions that reflect their own personal views when booking travel. Travellers want to support sustainable practices, with nearly three in five [59 per cent] willing to pay higher fees to make their trip more sustainable.

Additionally, a majority [65 per cent] 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.

Financial security and safety are top priorities

The Traveller Value Index ranks the factors shaping booking decisions across multiple travel experiences, including:

  • The ability to get a full refund if their plans change
  • Atypical, low pricing cause by low demand during the pandemic
  • Contactless experiences like card-less hotel or vacation rental entry, online check-ins, or digital boarding passes
  • Environmentally friendly policies such as a reduced use of plastics or locally sourced food and products
  • Enhanced cleaning and disinfection procedures
  • ​Flexible policies to change bookings
  • First-class benefits and upgrade

Financial security and safety rank as the highest priorities for travellers across all experiences, a shift from the conventional wisdom that price drives consumer behaviour. More than one in four travellers most value the ability to get a refund, particularly for airline [26 per cent] and vacation rental [26 per cent] 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.

The Traveller Value Index also shows differences in values by age group, indicating that younger groups are less focused on price and refunds. These include:

  • 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 USA 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 per cent] 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 are the only respondents from numerous countries who 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.

Click here to download the full Traveller Value Index report.