Generations January 2018 On The Move - Expedia

Generationson the MoveJanuary 2018A deep dive into multi-generational travel trends andhow their habits will impact the future of the industryResearch Presented By: 2018 Expedia and The Center for Generational Kinetics. All rights reserved.1

table ofcontents03a word from the authors04spending and travel priorities09online travel agencies and theappeal of convenience14social media and the importanceof travel19research conclusions20about the authors21methodology22copyright and usage 2018 Expedia and The Center for Generational Kinetics. All rights reserved.2

a wordfrom the authorsNew technologies, greater connectivity, and changing values have transformedthe way we look at travel. Add in the coming of age of the first generation ofdigital natives, and we’re on the verge of tipping point as the cycle of travelplanning, purchasing and experiencing changes.Sampling more than 1,000 adults in the UnitedStates, aged 18-65, provided multi-generationalinsights that not only paints a positive picture for thefuture but also signals to the industry that it needs toevolve to stay relevant.generational cheat sheetgeneration Z(1996–earlier)Consumers have more options for searching andbooking travel than ever, making it vital for providersto understand these travelers’ thoughts anddesires. Americans are shucking their materialismin exchange for life enriching experiences, growingsocial media influences, and highly ping into these trends will give travel providersa head start in reaching younger generations set tobecome powerful consumers. Earning their attentionearly will pave the path to winning their loyalty.generation X(1965–1976)Now is the time for a fresh look at travel, particularlythe role of online travel agencies, and the preferencesof younger generations like Gen Z (ages 21 andyounger) towards traveling.baby boomers(1946–1964)Expedia and The Center for Generational Kineticsare pleased to partner on this groundbreakingnational research.traditionalists(1945–before)– Expedia and The Center for Generational KineticsFor more information about thegenerational birth years, click here. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.3

spending and travelpriorities through agenerational lens 2018 Expedia and The Center for Generational Kinetics. All rights reserved.4

a shift in americanspending prioritiesFor decades, the American economy centered around materialism, with therole of marketing and advertising revolving around connecting potentialcustomers not only with products they needed, but also products theywanted or thought they needed to add value to their lives.An emerging trend.is the shift towards placing value on experiences, rather than things.PrioritizeExperiencesOVER74%Productsor Thingsof AmericansNowhere is this shift in priorities moreimmediately evident than in travel, at its heartan industry inherently based on experiences.Baby Boomers are entering a stage where“less is more,” while younger generations,particularly Millennials, are leading the chargein placing a newfound value on experiences,more than things.When it comes to where Americans are spendingtheir money, travel is a top priority, particularlyamong Millennials. In fact, The national studyfound that 57% of Americans are currentlysaving money specifically for travel. But, this iseven higher for Millennials, where 65% of whichwho say they are currently saving for travel. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.5

Bottom Line:In the shift towards valuing experiences over materialproducts, travel makes an impressive showing. Morethan half of all Americans say they are saving specificallyfor travel, with Millennials leading the charge. Travel isa common way for all generations, regardless of age, tospend their disposable income. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.6

age and incomeinfluence travel prioritiesExperiences are top of mind across all generations when it comes to travel,but the nature of those experiences varies greatly.The national study found Gen Z travelers valueadventure experiences such as exploring andtrying new things more than anything else. Onthe other hand, Baby Boomers see traditionaltravel experiences such as sightseeing or touringas the most important. Millennials and Gen Xdesire relaxation, such as the beach or spa time,more than anything else.Age is not the only factor influencing the natureof travel. Income brackets also come into the mix.Lower income travelers prioritize spending timewith loved ones the most, while middle incometravelers place a priority on sightseeing ortourism. Higher income travelers just wantto relax.less than 49K 50K- 74K 75K Connection TravelTraditional TravelRelaxation Travel(spending timewith loved ones)(site-seeing,tourism, etc.) 2018 Expedia and The Center for Generational Kinetics. All rights reserved.(unwind, de-stress,sleep in, etc.)7

When it comes to accommodation, allgenerations tend to value hotel reviews whenmaking their selection, with a string of badreviews acting as an automatic disqualificationfrom consideration. Younger generations aremore particular when it comes to connectivity.Wifi is an absolute necessity for 1/3 of Gen Z andthey are often willing to select hotels based onfree Internet access.Not only do the nature of trips differ greatly,but the duration does too. Americans, especiallyyounger generations, make the most of longweekends (typically 3-5 days).In fact, the national study found thatthe long weekend is the most preferredlength of time for a leisure trip forMillennials, Gen Z, and Gen X.Baby Boomers are much more likely to travel fora week or even longer. They are also more likelyto book trips further in advance, often monthsprior to departure, while Gen Z is apt to bookless than 30 days out, often within just a weekor two of travel.Bottom Line:When it comes to the type of trip,including activities, accommodation,and duration, priorities often followpatterns by age and income. The triplength also varies by age, with the longweekend serving as the preferred leisuretrip length for younger generations andBoomers typically traveling for longerdurations. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.8

online travelagencies and theappeal of convenience 2018 Expedia and The Center for Generational Kinetics. All rights reserved.9

online travel agencies spellconvenience for travelersFew aspects of travel have changed more over the past two decades thanthe research and booking process. For the most part, gone are the maps,phonebooks, and international calling cards—arranging accommodations nowonly requires internet access, which for many, is accessible in the palm of theirhands. The world of online travel booking has exploded and evolved beyondjust browsing the websites of individual hotels or airlines. Customers wanteverything, all in one place, and convenience is now the name of the game.What does convenience look like?80%of Americans say it’shelpful to be able to book alltravel and accommodation(such as flights, rental cars,vacation rentals, or hotels)on one website.Even more staggering is that 87% of Gen Z say bookingin one place is helpful.If an all-in-one online shopping destinationis helpful, is it also preferable? The nationalstudy found that younger generations do, infact, prefer to book this way. Half of Gen Z and48% of Millennials say visiting an online travelagency website is how they prefer to booktransportation and accommodations.It requires a great deal of trust from consumersto make a purchase without shopping around,but this is exactly what the majority of travelerssay they would at least consider doing. Thenational study found that 55% of travelerswould consider, and 15% would definitely bookan entire trip through an online travel agencywithout visiting any other websites. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.10

Bottom Line:Convenience is king for all travelers,especially evident in the opennessof younger generations to bookaccommodations using online travelagency websites. Already, half theGen Z respondents and nearly half ofMillennial respondents say an OTAis their preferred way to book travel.The majority of travelers, regardlessof age, believe it would be helpful tobook accommodations in one placeand say they would consider bookingan entire trip through an OTA withouteven visiting other websites. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.11

family members aregreat travel companions and often foot the billBy and large, Americans like to travel withfamily members—spouses, children, parents,or other family members are the preferredtravel companions across generations. Gen Z,the youngest generation of travelers, is far morelikely to travel with parents, with 54% sayingthey usually or always travel with their folks.Parents don’t just make great travel companions;they also serve as good financial sponsors.The national study found that58% of Gen Z respondents’ parentspaid for trip expenses when theytraveled together over the past year.The phenomenon of parental sponsorshipisn’t applicable only to Gen Z, with 24% ofMillennials also stating parents pay for theirtravel costs when they go away together.While group travel – whether with family,friends or tour groups – is the more commonlypreferred trip type, the national study founda surprising number of people prefer to travelalone for leisure. More than one-third ofAmericans have traveled alone for leisure inthe past year, but the number is even higher forMillennials, 42% of whom have traveled alone. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.12

Bottom Line:Travelers like to experience new destinations withcompanions, and often in the case of youngergenerations, those travel partners are parents who paytheir way. However, people also travel alone for leisure,with a notable number of Americans having done so inthe past year. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.13

social mediaand the connectionto travel 2018 Expedia and The Center for Generational Kinetics. All rights reserved.14

social media is disruptingthe travel funnelThe process of making consumerdecisions has radically changed foryounger generations—social mediais at the heart of that change, withthe ready opinion of dozens of friendsright at consumers’ fingertips.A post on social media can turn into a poll,collating tips and opinions of multiple peoplein a matter of minutes.When it comes to making travel purchasingdecisions, Gen Z and Millennials are mostheavily influenced by input on social media. Infact, the national study discovered that 27% ofMillennials have posted a potential trip on socialmedia to canvas opinions before booking!27%of Millennialshave posted a potential tripon social media to canvasopinions before booking!Interestingly, socialized purchasing decisionsappear to have a halo effect, stirring interestamong potential buyers who see or weigh inon a decision. The study discovered that36% of Gen Z travelers have chosen a destinationspecifically because they saw postings about thedestination on social media.36%of Gen Zhave chosen a destinationspecifically because theysaw postings about thedestination on social media. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.15

Bottom Line:Social media has a profoundinfluence on the purchasing decisionsof younger generations, even tothe point of directing their traveldecisions. They pan their social medianetworks for opinions before choosinga destination, and even make traveldecisions based on others posts. Thesecret to capturing the attentionof this generation of consumers isinexorably tied to social media. 2018 Expedia and The Center for Generational Kinetics. All rights reserved.16