Deloitte: Seeking deals, Americans prepare to travel again

Millennials are increasingly looking for travel deals. Image credit: Getty Images (Deloitte Millennials Deals)

A new study from Deloitte examines findings from the firm’s Global State of the Consumer Tracker and InsightIQ business-intelligence platform for insights into the trajectory of leisure travel in the United States.

By examining the evolving safety and economic concerns, future travel intentions, current travel spending and online travel shopping behavior, the report, authored by Marcello Gasdia and Anthony J. Jackson, offers a glimpse of how the leisure travel sector may recover. 

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As of mid-May, nearly a third of U.S. consumers said they would feel safe staying in a hotel. This number is up from roughly 1 in 5 in early April. During the same time period, consumers reported feeling safer conducting everyday business like going to the store, up to 42 percent from 30 percent. Equally positive, almost one-third of US consumers (31 percent) were planning to stay in a hotel for leisure during the summer months—slowly improving from a mid-April low of 24 percent. 

There is certainly interest in getting on the road again, according to Deloitte: Daily traffic to online travel agency websites and travel metasearch engines is slowly improving. It was down roughly 80 percent year-over-year in early-April, but somewhat improved in the third week of May, when it was down only 73 percent year-over-year.

That Summer Feeling

The recovery window will likely vary across different segments of the travel industry. While leisure spending intentions show signs of growth for both hotel and domestic flights, other segments (including car rental, cruise, and international air travel) have yet to show a material increase, according to the report.

Summer travel plans are reportedly stronger among 18–34 year olds, hitting 36 percent for hotel and 34 percent for domestic air travel in mid-May. Millennials also are more likely to be actively searching for travel deals, signaling stronger evidence of a price bottom for the age group.

Health vs. Finances

While there is significant interest among U.S. consumers to travel, however, health and financial concerns (more the latter than the former) are driving would-be travelers to delay paying deposits on their trips. “The percentage of U.S. consumers concerned about making upcoming payments (27 percent) and delaying large purchases (43 percent) have yet to show signs of falling,” the report claimed. “While the economic fallout from COVID-19 will naturally have a latent effect, a potential scenario of falling health concerns and prolonged financial stress brings important implications to the travel industry.” 

Still, Americans are willing to spend money on their leisure travel. Hotel, airline and car rental spending has now sustained four weeks of positive year-over-year growth. The report states that it seems possible that spending bottomed out in mid-April, falling 80 percent to 90 percent across travel segments compared to the previous year. If this is the case, it is hard to go anywhere but up, according to Deloitte.