Is Travel Going Anywhere? Yes and No.
2023 Travel Trends Overview
Travel is in the human DNA. It allows us to experience new things, understand others, reconnect with loved ones and so much more. With so much happening in the world, travel is more important than ever to help us feel connected to each other.
The travel industry has faced some significant challenges over the past few years. COVID-19 brought the industry to its knees. But on the other side of lockdown, we’ve seen a great return to travel. People were sick of being locked down and were ready to get out and see the world again. 2022 boasted record travel numbers from many destinations across the globe. Even as costs crept up, consumers continued to travel.
But what will 2023 bring? The market is volatile. Inflation and the rising cost of living are causing struggles for many families. Will there still be money left to make travel plans?
The answer is “yes,” although this year will likely bring on some changes in how consumers are traveling. Here are some predictions for the year ahead.
RISING COSTS WILL AFFECT TRAVEL FREQUENCY
Price increases are nothing new at this point. From higher grocery bills to more money spent at the gas pump, we’ve all felt the effects. Certainly, the travel industry has seen its fair share of rising costs in the last year. Despite this, travelers remained unphased throughout 2022. Demand continued to surge post-COVID and many consumers were willing to pay a premium if it meant finally taking that long-anticipated trip (or trips). Whether or not this sentiment will continue throughout 2023 remains to be seen. The holiday 2022 travel season was a record-setter and early 2023 travel numbers are holding strong for now. But as the cost of living continues to increase, the data is starting to show that American travelers may be tightening their purse strings. Destination Analysts recently released trend data for 2023, showing almost half of Americans cited the high cost of travel as a factor that prevented them from taking a trip in the past six months. What does this mean for the industry?
As the costs increase, discretionary spending decreases and with it, travel spending. However, with demand still at record highs, consumers will unlikely cut off trip planning altogether. More likely, the number of trips they take throughout the year will decrease. When COVID travel restrictions were lifted, consumers planned a record number of trips and traveled more frequently. Over the next few years, it’s likely that frequency will decrease. The once-a-year family vacation may become the norm once again.
DEALS WILL BECOME MORE IMPORTANT
Travel is still high on consumers’ priority list, but with less budget to make a stellar trip happen, saving and deals will become more important. We’ve talked about how consumers will be taking fewer annual trips. That’s because they’ll be saving to splurge on a truly memorable vacation experience. That one trip to make it really count. We can also expect travelers to place higher importance on deals. Expect a heightened interest in special rates, rewards programs, credit card travel points, etc. More consumers may also lean into non-peak seasons for a more cost-efficient trip. In fact, with remote work also making travel more flexible, we may enter a time when there is no “peak” and “off-peak” season.
UNIQUE EXPERIENCES WILL TRUMP THE AVERAGE VACATION
Because travelers will be taking fewer trips, they really must make the ones they do take count. This means leaning into unique and unexpected experiences. This means something different for everyone so destinations would do well to take stock and identify what niche experiences they can offer and who those experiences appeal to so they can market accordingly. For example, many consumers are now seek unplugged” or “off-the-grid” offerings. Destinations with a strong nature offering can address this want. Wellness vacations and foodie destinations also continue to rise in popularity. 2023 will usher in the “no normal” for travel.
DON’T FORGET THE BUSINESS TRAVELER
Often destinations focus more on B2C communications, but in 2023, the B2B traveler should not be ignored. The emergence of remote work has added so much flexibility to where workers can conduct business. This, coupled with an increased emphasis on health and wellness post-pandemic, has made bleisure – a blend of business and leisure – a major trend for 2022 and 2023 (and likely beyond that). The idea of bleisure is not new, but it is something that is becoming bigger than ever before. Destinations should take notice and consider how to market to this group to show how travelers can blend work and play to make a truly productive and memorable trip.
OUTLOOK FOR THE FUTURE
It’s difficult to say with any certainty how the industry will move in the coming years, with so many factors at play. What can be said, though, is consumers have become hooked on travel post-COVID and this is not expected to change anytime soon. Sure, the frequency and types of trips may change, but the industry’s strength will likely continue for some time. After being closed off from the world for so long, the human need to connect with others and see the world has returned with a vengeance. We’ve always loved to travel. But now, we NEED to travel.
Destination Analysts, The State of the American Traveler in January¾Americans’ Top Travel Predictions for the New Year, January 2023
Expedia, 2023 Travel Trends Report, 2023