Navigating Money Trouble: This Year’s Summer Travel Trends

George Meshkov
6/1/2023

Good News for Summer Travel

One of the most promising findings that we can hope for is a heightened interest in travel in general and, this year, that is most definitely the case. Last year, about 60 percent of U.S. respondents said they planned to travel during the summer. This year, that number rose to 63 percent, with 57 percent saying they took a trip in 2022. In combination with 75 percent of participants indicating they’re either really excited or happy to travel this year, the outlook for the season looks positive. While the percentage of those planning to take a trip remains behind pre-pandemic studies, the 63 percent mark is the highest we’ve seen in four years.

Much of this year’s increased interest in travel can be attributed to the waning pandemic as the upward trend aligns with a downward trend we’re seeing in travel-related precautions. Most avoidant and cautious behaviors, such as avoiding airports, crowded places, and certain countries were less popular this year, as were concerns, such as getting sick on a trip, not being able to return home, and needing to cancel. When choosing a destination, fewer travelers said the risk of getting COVID-19 played a role, yet over 25 percent still cited it as an essential factor. The lingering effects of the pandemic seem to have impacted travel habits in some ways, but not drastically so.

2023 Summer Travel Habits

Big(ish) Trips for Travelers

While the percentage of those planning trips still lags a little relative to 2019, those who are traveling this year appear to be planning bigger trips. For one, travelers are planning to be away a little longer. The average trip length for U.S. respondents was 1.6 weeks, the longest average trip length that we’ve seen in seven years. Travelers are planning to spend a little more, too. The average budget was just over $3,000, up 6 percent YOY, and 54 percent of travelers stated their budget has either increased a lot or slightly compared to 2022.

Domestic Destinations + Experiences

Interestingly, while the average trip length and budget grew this year, international travel plans were slightly down while domestic trips were slightly up. Considering these changes, what’s even more peculiar is an increased interest in tours, with 30 percent of travelers stating they intend to take a tour-based trip, up 11 points YOY, while interest in coastal, mountain, and city travel more or less remained stagnant. These fluctuations, or lack thereof, may suggest that many travelers are looking for more active, experience-filled trips relative to past years, even if it’s within the U.S.

The Why of Travel

As we’ve seen in past studies, relationships were the driving force for many travelers, and the most popular factor when choosing a destination. Up eight points YOY, 34 percent of travelers will choose their destination because they have friends there, and partners and children were the most popular choices in travel companions. Aligning with these trends, coming together with family and friends was the most popular ideal travel activity, followed by resting and having peace of mind, and enjoying a change of scenery and discovering new cultures. However, when it comes to what travelers actually expect to be able to do on their trips, while more believed they will be able to explore their destination and discover different walks of life compared to last year, only 30 percent of respondents believed they’ll be able to find relaxation and peace of mind, a downward trending data point for 2023 and a potentially troubling number compared to the 47 percent that seek such rest and rejuvenation.

Transportation Trends

The preferred mode of transportation can tell you a lot about a traveler’s intentions, and this year’s transportation trends were pretty consistent with 2022’s. Personal car was the most popular transportation choice, slightly more popular than last year, followed by air travel, which was also up one point YOY. These choices were shaped by convenience more than any other factor, with 63 percent of travelers citing it as a key criterion, a six-point increase compared to 2022. The popularity of drive-to destinations neatly aligned with this year’s heightened interest in domestic travel. This trend is likely further shaped by the second most popular transportation-choice criteria: affordability.

This Year’s Detractor: Economic Concerns

After years of COVID-19-related worries, there’s a different but still familiar travel threat in town this year: the economy. While not being able to afford a trip is often the most popularly cited reason for respondents not traveling in any given year, this year the data point rose six points, with 51 percent of participants selecting it. Interestingly, this increase in economic concerns may not necessarily be tied to inflation. Still the most significant concern negatively impacting travel enthusiasm, inflation was also down a point among travelers YOY, while personal/family reasons increased by two. When asked about their main concerns about their next trip, 40 percent of respondents chose running out of money, up three points compared to 2022. When asked about the most important factors impacting destination choice, intended budget was by far the most popular selection, up eight points YOY with 56 percent of participants choosing it.

2023 Trend: Last-Minute Deals

With money worries being top of mind, it’s no surprise that many travelers will be looking for last-minute deals this year. Thirty-seven percent of travelers will be searching for these deals, and while 67 percent of respondents said they would make plans at least two months out, another two-thirds of travelers surveyed hadn’t booked their trip yet at the time of the survey (we should be clear that this survey was conducted between March 20 and April 7, a month earlier compared to previous years. Yet, we still see the trend as noteworthy). When asked if they would take a domestic or international trip, 38 percent of respondents weren’t sure yet and 15 percent said they would book their trip later than they did last year, up four points compared to 2022.

How might the economic impact a traveler’s accommodation choice? Affordability was up six points YOY in this category. Although hotels are consistently the preferred accommodation type among travelers, this year the choice also experienced a four-point increase compared to last year, while vacation rentals remained stagnant YOY. These changes could suggest that travelers are finding hotels to be a little cheaper this year and that they’re garnering more interest as a result. When asked how they intend to adapt their travel plans as a result of inflation, nearly 30 percent of respondents stated that they would look for cheaper lodging.

2023 Trend: Workcations on the Rise, Sustainability Ebbs

What compliments rising money worries among travelers? Working on vacation. What doesn’t? Sustainable travel. Although many travelers reported already participating in sustainable travel practices, such as reducing waste and their carbon footprint, fewer did than in 2022 for the vast majority of these practices. On the other hand, 36 percent of travelers said they will work at least part of the time that they’re away, up four points YOY. The upward-trending “workcation” is most popular among domestic travelers and seems to be, at least in part, a strategy for taking longer trips. When asked about their workcations, 41 percent stated they’ll arrive earlier as a result of working on their trip and 32 percent stated they’ll stay longer. In terms of accommodation type, hotels and vacation rentals were the most popular workcation choices and both were up in popularity YOY.

The Takeaway

There’s a lot that property owners and vacation rental managers can be optimistic about this summer. You can expect more travelers getting out and about, and domestic and drive-to destinations should be popular. Even though this year’s traveler is relatively cost-conscious, those taking trips are also ready to spend a little more in terms of both time and money. So, how can you optimize this year’s revenue? Catering to the workcation traveler seems to be a good bet, and so does investing in packaged experiences for guests. Price hikes, on the other hand, might be ill-advised as hotels create more competition compared to previous years and travelers look for last-minute deals.

What’s another way to boost your income and help travelers find the rest and relaxation that they want? Offer travel insurance from Generali Global Assistance. With commission earned on every plan sold, easy-to-administer programs facilitated by in-house APIs, and 40 percent of travelers interested in buying it for their next trip, it’s a win-win across the board. Get started with us today.

George Meshkov

George Meshkov is the senior vice president of travel insurance sales at Generali Global Assistance.