The U.S. Millennial Traveler: Leading a Travel Revolution · 2014-10-27 · travel brands. But they will be, when they reach their peak earning and spending years. • Now is the

The U.S. Millennial Traveler: Leading a Travel Revolution Sponsored by

October 21, 2014

Lorraine Sileo

Senior Vice President

Research

PhoCusWright Inc

Marcello Gasdia

Senior Analyst,

Consumer Research

PhoCusWright Inc

Udayan Bose

Founder and

Chief Executive

NetElixir

#phocuswright #netelixir

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The U.S. Millennial Traveler: Leading a

Travel Revolution Sponsored by

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October 21, 2014

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Agenda

1. Why millennials?

2. General travel behavior—millennials vs. older travelers, is there

a difference?

3. Key online shopping and booking trends

4. Technology + travel planning

5. What happened to social?


Why are

Millennials So

Important?



SPENDING

POWER


Source: U.S. Census Bureau

25% of U.S.

population

80 million U.S. consumers were born between 1977 and 2000, making the millennial generation

bigger than Baby Boomers and Generation X


2013 Incidence of Leisure Travel,

by Age

Source: PhoCusWright's Consumer Travel Report Sixth Edition

68% 73%

67%

60% 60% 59% 65%

18-24 25-34 35-44 45-54 55-64 65+ Average


General Leisure

Travel Behavior



66% consider travel a very important part of their lifestyle


Millennials Travel Often


3.19

2.84

Millennial travelers Older travelers

Annual Leisure Trip Frequency


71% took at least one quick getaway

in 2013 (3 nights or less)



2x more likely to take long trips (14 nights or longer)



42% traveled internationally in 2013 (compared to only 28% of older travelers)




$3,217

$3,381

Millennialtravelers

Older travelers

Annual Leisure Travel Spend



Only booked hotels 1.5x in 2013 (compared to 2 for older travelers)



6 in 10 stayed with

Friends and

Family for

at least

one trip in

2013 #phocuswright #netelixir


Only half of millennials took a

purely discretionary trip in

2013



• Not the core customers for

travel brands. But they will

be, when they reach their

peak earning and spending

years.

• Now is the time to build

relationships, as they begin

to engage with travel

brands and form

perceptions about them,

and develop travel habits

and preferences.


37%

50% 53% 52% 54%

67%

18-24 25-34 35-44 45-54 55-64 65+

22%

41%

49% 50% 50% 57%

18-24 25-34 35-44 45-54 55-64 65+

Airline loyalty member

Hotel loyalty member

Loyalty




85% of millennials “…always check multiple websites to

make sure they get the best deal”


Millennial Travelers and Older Travelers

Generally Use the Same Websites to

Shop for Travel


54%

48%

37% 37%

27%

21%

54%

46%

36% 31% 33%

7%

OTA SearchEngine

TravelerReview

Metasearch TravelProvider

SocialNetworks

Millennial Travelers Older Travelers


But There are Significant Differences in

WHY They Choose Where to Shop

Online…


57%

48%

36% 36% 29%

7%

59%

36% 34%

49%

20% 17%

Ease of use Best prices Brand trust Goodprevious

experience

Widestselection

Loyaltymembership



Widest selection

Dis(loyalty)

Best prices

(Perceived) Open to new

channels


Millennials Gravitate to Intermediaries

When It Comes Time To Book Flights


37%

24%

15%

8% 6%

28%

42%

9%

16%

3%

OTA Direct online Metasearch Direct by phone Retail travelagent

Airline Booking Channel (Typical Behavior)




23% of millennial travelers booked their last

trip less than one week before departure

Only 12% of

older travelers

did the same




Smartphone 90% 57%

Tablet 55% 34%

Desktop 62% 73%

Laptop 82% 73%

Source: PhoCusWright Inc.



Destination Selection

Travel Shopping

Booking

15%

13%

7%

6%

11%

5%

82% 89%

84%

Tablet Smartphone Desktop

Devices Used During Trip Planning

Lifecycle Travelers (Non-millennials)

Source: PhoCusWright’s Traveler Technology Survey 2013


Destination Selection

Travel Shopping

Booking

25%

25%

16%

36% 37%

23%

79% 80%

80%

Tablet Smartphone Desktop

Devices Used During Trip Planning

Lifecycle Travelers (Millennials)

Source: PhoCusWright’s Traveler Technology Survey 2013


Polling Question

What percent of millennial mobile travel planners used a

search engine to research upcoming trips on a smartphone?

A. 15%

B. 27%

C. 54%

D. 66%


66% of millennials

use search to shop and buy

travel on mobile

Search is #1 for Mobile (not OTAs)


Social

Networks???


Social

Networks???

Economy #phocuswright #netelixir


Source:

Storage $200 a year

Extra parking spot $100 a year

Lawnmower $20 a day

Dog $10 a walk

Boat $250 a day Car $50 a day

Bike $10 a day

Guitar $50 a week Power Tools $20 a day


Source:

Extra Room $75 a night




Source: PhoCusWright Inc.

Private Home, Apartment or Condo

Rentals are Growing…

8%

10% 10%

14%

0%

10%

20%

2010 2011 2012 2013


Source: PhoCusWright’s Share This! Private Accommodations and the Rise of the New Gen Renter

Half of Renters are Millennials…

51% 49%

Millenials 18-34

35+

Renters

38%

62%

Non-Renters


26%

26%

27%

29%

36%

44%

45%

48%

49%

52%

0% 10% 20% 30% 40% 50% 60%

More casual

Prefer a “home-like” experience

Less expensive

More privacy

More freedom

Better value for money

Easier to accommodate my family or groupof friends

Multiple bedrooms

More room/space

Home-like amenities (kitchen facilities,washer/dryer)

Why Renters Rent

Source: PhoCusWright’s Share This! Private Accommodations and the Rise of the New Gen Renter


Why Millennial Renters Rent

Source: PhoCusWright’s Share This! Private Accommodations and the New-Gen Renter

40%

41%

38%

52%

47%

34%

44%

41%

48%

44%

0% 10% 20% 30% 40% 50% 60%

More casual

Prefer a “home-like” experience

Less expensive

More privacy

More freedom

Better value for money

Easier to accommodate my family or groupof friends

Multiple bedrooms

More room/space

Home-like amenities (kitchen facilities,washer/dryer)


Overview


Questions?



Upcoming Webinar: Mobile End to End: The Impact of Mobile across Search-

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November 6, 2014

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Vice President

Research

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PhoCusWright Inc.

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The U.S. Millennial Traveler: Leading a Travel Revolution · 2014-10-27 · travel brands. But they will be, when they reach their peak earning and spending years. • Now is the