Cost of living crisis and travelling abroad
The days of cheap flights appear to be over. Summer is well and truly upon us, but will holidays abroad be something that we have to cut back on this year?
The cost-of-living crisis continues to have a great impact on our daily lives. With such financial strains being felt, we wanted to assess the impact that this will have on holidays abroad, along with the ways in which people are planning on cutting back.
Summer holiday cutbacks
Results from Savanta’s consumer omnibus which surveyed a nationally representative sample of 2,227 UK adults, revealed that around six in ten (58%) will be cutting back on holidays abroad this summer due to the cost-of-living crisis. Moreover, just under one quarter (23%) will not be cutting back and around one in five (19%) reported that the cost-of-living crisis has no effect on whether they will travel abroad. When looking at the demographics of those who will be cutting back, age is a contributing factor, with Millennials being the most likely to cut back (63%) and Baby Boomers the least (54%). Gender also comes into play with females more likely to cut back than males (63% vs. 54% respectively).
We looked at ways in which individuals will be cutting back this summer, the top cited method was to refrain from booking any holidays abroad (41%). Those living in Wales and the Midlands are the most likely to do this (47%), while those living in London are the least likely (33%). Following this, the next top money-saving methods were to reduce the number of holidays booked abroad (18%), holiday closer to the UK than usual (13%) and stay in cheaper accommodation, e.g. hostels (12%).
Savanta’s Consumer Compass involving 1,412 UK respondents has also shed some light on this topic. It revealed that the top three ways respondents were saving money on holidays were:
• Holidaying in the UK (30%)
• Going on shorter holidays (21%)
• Going on holidays at different times of year, e.g. off-season (17%)
Are staycations viewed as more cost effective?
Staycations have become popular since Covid – but are they perceived as more or less affordable than holidays abroad? Our consumer omnibus revealed that over two in five (45%) believe that staycations are more affordable, 15% consider them less and around one in five (22%) think that they are neither more nor less affordable than holidays abroad.
Perceiving them to be more affordable appears to decrease by age, with 52% of Gen Z believing this, compared to 39% of Baby Boomers – this downward trend in age could be due to older generations having more budget to spend whether they are abroad or in the UK, and so they are more likely to perceive them as neither more nor less affordable. Region also comes into play, with Londoners being the least likely to perceive staycations as more affordable (40%) and Wales/Midlands and the South (excl. London) being the most (46%).
With a large proportion of UK adults planning on cutting back on holidays this summer, it will be difficult for companies to retain their customers if travel costs continue to rise. It will be interesting to monitor this as time goes on and cost of living pressures may or may not continue.