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Global Travel Budgets on the Rise; TripAdvisor Releases Results from New Study

Travel News Asia Videos Podcasts Latest Travel News Asia Thursday, 24 April 2014
 

TripAdvisor has unveiled the results of the third installment of TripBarometer, a biannual study conducted on behalf of TripAdvisor by independent research firm Ipsos.

The survey highlights country, regional and global travel trends, according to more than 61,000 travellers and hoteliers around the world, with 5,657 consumer and 1,142 business respondents from Asia. Revealing changes in consumer spending plans and worldwide travel patterns, the TripBarometer also reports behavioural differences in planning and booking habits of travellers.

The results of the latest TripBarometer study paint a positive picture for the global travel industry – overall, travellers are planning to spend more on their holidays in 2014 with the average annual traveller spend rising from US$5,955 in 2013 to US$6,136 for this year, an increase of three%. On average, Asian travellers plan to increase their annual travel spend by 7% from US$4,331 in 2013 to US$4,633 in 2014.

Additionally, the proportion of travellers planning to travel more has increased across almost all markets. This year, 90% of global travellers are planning to travel domestically (up from 87% in 2013) and 77% plan to travel internationally, up 12% compared to 2013 (65%). In Asia, 93% of travellers are planning to travel domestically (up from 90% in 2013) while 74% are planning to travel abroad, up 14% compared to 2013 (60%).

Budgets Increasing but Travellers Still on Hunt for a Bargain

South African travellers are planning the biggest increase in their travel budgets this year, up 30% from 2013, followed by Indonesians, Australians and Malaysians. Despite relatively low optimism in the economy (only 11% of global respondents and 17% of Asians will spend more on travel because they feel more confident about the economy), travellers are not willing to give up their holidays, with many opting to hunt for bargains and make sacrifices in other areas of their lives in order to protect their travel spend.

The tendency to do more research in order to find the best bargain is strong amongst travellers. The majority of travellers (Global: 54%; Asia: 51%) say their choice of holiday is often determined by the availability of a good deal or special offer. In fact, TripBarometer respondents in Asia indicate that ‘price’ (94%) and ‘special offers’ (49%) are important decision-making factors when booking their accommodation.

The study reveals that currency fluctuations are likely to affect travel plans of Asian travellers, with 51% indicating that it would impact their holiday plans, compared to 44% globally. Despite this, those affected are still planning to travel; of those travellers that say currency fluctuation will impact them, 53% global respondents and 53% of Asian respondents will research more to find the best price.

However, global hoteliers place higher importance on online reviews than price in terms of influencing travellers’ booking decisions. Similarly, Asian hoteliers perceive online reviews (61%) to have the biggest impact when travellers book accommodation, followed by price (55%) and recommendations from friends and family (39%). The results suggest that although hoteliers know price is an important factor, they believe that the room rate combined with a good online reputation will ultimately influence travellers’ booking decisions.

Looking ahead at the next 12 to 24 months, Europe tops the list of places global travellers plan to visit (46%), followed by Asia (39%) and North America (32%). The US (28%) tops the list of ‘dream’ destinations for Asian travellers to visit in the next 12 to 24, followed by Italy (27%) and Australia (26%).

“Exploration is back on the agenda in 2014, with more travellers planning international trips this year,” said Marc Charron, President, TripAdvisor for Business. “TripBarometer offers up insights into the needs and behaviours of consumers in today’s rapidly changing travel marketplace, providing valuable insights for hospitality businesses looking to attract new audiences. Travellers are upping their budgets but they are looking for bargains, expecting their accommodation of choice to deliver on value. Special offers, complimentary amenities and exceptional service are all going to be important factors in swaying potential guests.”

The increase in travel budgets and travel plans is mirrored in business confidence with 70% of global hoteliers saying they are optimistic about their profitability in the next year (up from 67% in 2013). In comparison to the global average, Asian hoteliers seem less positive, with 63% claiming they are optimistic about their profitability in the next year (down from 72% in 2013). Over half (55%) of Asian hoteliers are also planning to increase room rates with 47% saying this is due to increased overheads.

Online and Offline

Most global travellers (65%) start planning their trip at least three to four months before they intend to go, with just under a third (32%) expecting to book one month ahead of their trip. In contrast, the majority of global hoteliers (65%) estimate that most of their bookings take place within four weeks of the guest’s date of arrival, with the length of time increasing slightly for resorts.

Travellers from Asia are the most likely to book their accommodation relatively last minute, with 23% booking up to two weeks before their trip which is higher than the global average of 16%.

When it comes to travel planning, online dominates, with 98% of travellers globally using online resources – 74% of global respondents cite ‘TripAdvisor’ as the most commonly used online source for inspiration when researching and planning holidays, followed by ‘content generated by travellers on travel websites’ (53%). Yet online and offline co-exist. Travellers globally report that they like to use both online and offline resources to plan their trips, with 87% also using offline means, including word of mouth (55%) and travel guide books (45%).

Mobile Booking Increases in Asia, Global Uptake Still Slow

Globally, travellers are attached to their mobiles, with a majority saying they use their smartphones on holiday (Global: 91%; Asia: 94%). One in three travellers use their smartphone to find things to do (Global: 37%; Asia: 34%), and just over a quarter are searching for hotels (Global: 27%; Asia: 32%). Despite the increasing number of travellers using their mobile to plan and research, the trend has not yet crossed over to the booking stage.

Close to the global average, 62% of Asians booked their last trip online. For those who booked their last holiday online, three out of ten stated ‘better price’ as the reason for choosing this booking method (Global: 31%; Asia: 35%). Twenty-seven% of Asians booked offline, compared to 24% of global travellers. Whilst online bookings are commonplace, mobile bookings are emerging slowly. Just four% of travellers globally booked the accommodation for their last trip via mobile; however, China is leading the pack with 10% of Chinese booking via mobile, followed closely by Thailand (9%), Indonesia (7%) and Malaysia (7%). This behaviour implies a ‘leapfrogging’ from offline to mobile channels in Asian markets.

Three in four (76%) of global hoteliers and eight in ten (82%) Asian hoteliers already have a mobile offering for travellers in place, of those who do not, 50% of global hoteliers and 60% of Asian hoteliers plan to introduce a mobile offering in 2014. Nearly half (47%) of Asian hoteliers currently allow guests to book rooms via their website on a mobile device, and 31% have a mobile friendly website. While it seems as though the hospitality industry is prepared for a shift towards mobile booking for travellers, there is still a disconnect.

“While the importance of mobile is accepted by the travel industry, and as evidenced by travellers using their smartphones in increasing numbers while in destination, there is still a tremendous opportunity when it comes to booking,” said Barbara Messing, CMO, TripAdvisor. “Hotels are gearing up to welcome bookings via mobile and travellers are already researching hotels on their phones – the next step is facilitating the booking process on mobile devices to reach more people on the go.”

TripAdvisor, Travel Trends

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