Table of Contents
Executive Summary
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- Impact of COVID-19 on the UK travel market
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- Figure 1: Impact of COVID-19 on the UK travel market, in short, medium and long term, 22 April 2021
- The market
- COVID-19 hits after holiday market reaches record heights
- Value of domestic holiday market expected to reach record levels in 2021 and then again in 2022
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- Figure 2: COVID-19 scenario forecasts for the value of domestic holidays taken by British residents, 2015-25
- International travel restrictions and lack of clarity delay the recovery of overseas travel…
- …but an increase in average prices will mitigate some of the damage
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- Figure 3: COVID-19 scenario forecasts for the value* of overseas holidays taken by UK residents, 2015-25
- The risk of vaccine-resistant strains of COVID-19 adds huge uncertainty
- The UK’s countryside has the highest growth potential
- Premiumisation is the biggest opportunity for overseas travel
- Cost of COVID-19 tests puts nearly half of travellers off
- High interest in integrating international travel restrictions in the planning and booking process
- The consumer
- The unveiling of the roadmap triggered more holiday bookings…
- …but levels remain low compared to before COVID-19
- Domestic travel market set to benefit from damaged confidence in overseas travel
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- Figure 4: Changes to holidaying frequency once the coronavirus outbreak is over, by destination, March 2021
- The younger generation has remained most open to international travel, but will be price-sensitive
- Reconnecting with family and friends is a key travel motivation
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- Figure 5: Holidaying intentions once the coronavirus outbreak is over, March 2021
- COVID-19 has increased the desire to take a holiday of a lifetime
- Majority of travellers are open to returning to tourism hotspots after vaccination
- Hardest-hit segments can benefit from vaccination requirements for certain itineraries
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- Figure 6: Attitudes towards COVID-19 vaccines and travel, March 2021
- Brits have not lost their appetite to travel
- Increased focus on wellbeing provides opportunities for offering wellness experiences
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- Figure 7: Attitudes towards wellness and responsible travel, March 2021
- Working holiday appeals to almost half of those who have flexibility on their working location
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- Figure 8: Interest in working holidays, by age, March 2021
Impact of COVID-19 on Travel Segments
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- The pandemic has boosted the appeal of rural and coastal areas and self-catered options
- Lack of overseas travel options has increased interest in rediscovering the UK
- Subdued appeal of city breaks
- Cruises and escorted tours have been particularly hard hit
COVID-19 Consumer Timeline
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- Phase 1 – January-March: consumers go into lockdown
- Phase 2 – March-June: adapting to life in lockdown
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- Figure 9: Recorded daily number of confirmed cases of COVID-19 and deaths registered as relating to the virus, 30 January-1 September 2020
- Phase 3: emerging from the initial lockdown
- Phase 4: rise of the next wave
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- Figure 10: Recorded daily number of confirmed cases of COVID-19, 30 January 2020-28 March 2021
- Phase 5 – January-March: winter lockdown and vaccine rollout
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- Figure 11: Cumulative number of first and second vaccines delivered in the UK, 10 January-7 April 2021
- Phase 6a – March onwards: the restart of domestic travel
- Phase 6b – May onwards: the proposed restart of international travel
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- Figure 12: Traffic light system for international travel, as recommended by the Global Travel Taskforce on 9 April 2021
The Post-pandemic Outlook for Travel
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- Staycation boom intensified amid uncertainty regarding the lifting of international travel restrictions
- Demand for holiday rental properties will accelerate
- The UK’s countryside has the highest growth potential
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- Figure 13: Participation and future ‘main holidaying’ intentions in the UK, by holiday type, February 2020 vs March 2021
- Premiumisation is the biggest opportunity for overseas travel
- Increased interest in nature-based breaks overseas
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- Figure 14: Participation and future ‘main holidaying’ intentions abroad, by holiday type, February 2020 vs March 2021
- Cost of COVID-19 tests puts nearly half of travellers off
- High interest in integrating international travel restrictions in the planning and booking process
The Economic Impact
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- A record drop in economic activity…
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- Figure 15: Annual percentage change in GDP, 2007-25 (forecast)
- …as COVID-19 restrictions caused a severe fall in spending
- Consumer spending is heavily dependent on the path of the pandemic
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- Figure 16: Household consumption index, 2019-25 (scenario forecasts)
- Furloughs have saved millions of jobs…
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- Figure 17: Number of employments furloughed, time series, March 2020-February 2021
- …but unemployment is forecast to rise when state support ends
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- Figure 18: Quarterly unemployment rate, Q1 2008-Q1 2026 (forecast)
- Under-25s have taken the brunt of COVID-19 job losses
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- Figure 19: Change in number of employees on payroll, by age, February 2021 vs February 2020
Market Size and Performance
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- Impact of COVID-19 on the UK travel market
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- Figure 20: Impact of COVID-19 on the UK travel market, in short, medium and long term, 22 April 2021
- COVID-19 hits after holiday market reaches record heights
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- Figure 21: Volume and value* of domestic holidays taken by British residents, 2015-20
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- Figure 22: Volume and value* of overseas holidays taken by UK residents, 2015-20
Market Forecast
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- Value of domestic holiday market expected to reach record levels in 2021 and then again in 2022
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- Figure 23: Forecast volume of domestic holidays taken by British residents (prepared on 22 April 2021), 2015-25
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- Figure 24: Forecast value* of domestic holidays taken by British residents, at current prices, (prepared on 22 April 2021), 2015-25
- International travel restrictions and lack of clarity delay the recovery of overseas travel
- Many overseas 2021 summer holiday bookings have been lost…
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- Figure 25: Forecast volume of overseas holidays taken by UK residents (prepared on 22 April 2021), 2015-25
- …but an increase in average prices will mitigate some of the damage
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- Figure 26: Forecast value* of overseas holidays taken by UK residents at current prices (prepared on 22 April 2021), 2015-25**
- Longer-term prospects remain positive, but potential pandemics pose a significant threat
COVID-19 Scenario Performance
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- Mintel’s approach to predicting the impact of COVID-19
- Fundamental differences in how COVID-19 is affecting consumer markets
- The risk of vaccine-resistant strains of COVID-19 adds huge uncertainty
- A rapid COVID recovery will have less impact on the recovery of domestic travel
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- Figure 27: COVID-19 scenario forecasts for the value of domestic holidays taken by British residents, 2015-25
- Extended COVID disruption will be disastrous for international travel
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- Figure 28: COVID-19 scenario forecasts for the value* of overseas holidays taken by UK residents, 2015-25
- COVID-19 market disruption: risks and outcomes
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- Figure 29: Summary of Mintel scenario expectations and the impact on the holidays market, April 2021
Consumer Concerns over the Impact on Health
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- Exposure anxieties align with case numbers
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- Figure 30: Mintel COVID-19 exposure anxiety and lifestyle impact index, 28 February 2020-12 March 2021
- Exposure anxiety typically higher among over-55s
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- Figure 31: Proportion of adults indicating higher levels of anxiety (‘4’ or ‘5’) towards being exposed to the coronavirus, by age, 28 February 2020-26 March 2021
- Middle-age band fear transmitting virus
Consumer Concerns over the Impact on Lifestyles
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- Concerns about lifestyles impact outweigh exposure fears
- Consumers react to unprecedented lifestyle restrictions
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- Figure 32: Mintel COVID-19 exposure anxiety and lifestyle impact index, 28 February 2020-12 March 2021
- Lifestyle impact concerns high across all age groups
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- Figure 33: Proportion of adults indicating higher levels of anxiety (‘4’ or ‘5’) about how the outbreak could impact their lifestyle, by age, 28 February 2020-26 March 2021
Impact on Household Finances
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- Financial wellbeing has hit new heights despite the crisis…
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- Figure 34: The financial wellbeing index, January 2015- March 2021
- …but many still feel worse off than a year ago
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- Figure 35: Changes in household finances, January 2015- March 2021
- One in six have been furloughed at least once
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- Figure 36: Impact of COVID-19 on employment and working patterns, February 2021
- Income trends point to a two-track crisis and recovery
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- Figure 37: Impact of COVID-19 on personal income, February 2021
- Cuts to discretionary spending have kept household finances afloat…
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- Figure 38: Impact of COVID-19 on household debts, February 2021
- …and led to a record savings boost
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- Figure 39: Impact of COVID-19 on the value of savings in different products, February 2021
- Most are optimistic about the year ahead…
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- Figure 40: The financial confidence index, January 2015-March 2021
- …and looking forward to getting back to experiences
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- Figure 41: Financial priorities when COVID-19 is no longer a concern, February 2021
Booking Intentions
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- The unveiling of the roadmap triggered more holiday bookings…
- …but levels remain low compared to before COVID-19
- The domestic holiday market benefited most from the uptick in bookings
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- Figure 42: Actual bookings and plans to book a holiday in the next three months, January 2019-March 2021
- Over-55s remain cautious about booking holidays
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- Figure 43: Plans to book a holiday in the next three months, by age, January 2020-March 2021
Future Holidaying Frequency by Destination
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- Domestic travel market set to benefit from damaged confidence in overseas travel
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- Figure 44: Changes to holidaying frequency once the coronavirus outbreak is over, by destination, March 2021
- The younger generation has remained most open to international travel, but will be price-sensitive
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- Figure 45: Changes to holidaying frequency once the coronavirus outbreak is over, positive vs negative (percentage points)*, by age and destination, March 2021
- Longer breaks will be popular in 2021
- International travel restrictions will make overseas shorter breaks less appealing
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- Figure 46: The impact of COVID-19 on changes in holidaying intentions, March 2021
Holidaying Intentions
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- Reconnecting with family and friends is a key travel motivation
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- Figure 47: Holidaying intentions once the coronavirus outbreak is over, March 2021
- COVID-19 has increased the desire to take a holiday of a lifetime
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- Figure 48: Holidaying intentions once the coronavirus outbreak is over, by destination, March 2021
Attitudes towards Travel
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- Majority of travellers are open to returning to tourism hotspots after vaccination
- Hardest-hit segments can benefit from vaccination requirements for certain itineraries
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- Figure 49: Attitudes towards COVID-19 vaccines and travel, March 2021
- Brits have not lost their appetite to travel
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- Figure 50: Attitudes towards travel, by demographics, March 2021
Longer-term Travel Trends
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- Increased focus on wellbeing provides opportunities for offering wellness experiences
- Travellers will want greener options moving forward
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- Figure 51: Attitudes towards wellness and responsible travel, March 2021
- Over a third of those in full-time employment expect to work more from home in the future
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- Figure 52: Changes to working patterns once the coronavirus outbreak is over, by working status, March 2021
- Working holiday appeals to almost half of those who have flexibility on their working location
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- Figure 53: Interest in working holidays, by age, March 2021
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Central Forecast Methodology
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- Volume forecast and prediction intervals for total holidays
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- Figure 54: Lower bound, central and upper bound forecast for the total volume of total holidays (domestic* and overseas) taken by UK residents, 2020-25
- Value forecast and prediction intervals for total holidays
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- Figure 55: Lower bound, central and upper bound forecast for the value* of total holidays (domestic** and overseas) taken by UK residents, 2020-25
- Volume forecast and prediction intervals for domestic holidays
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- Figure 56: Lower bound, central and upper bound forecast for the volume of domestic holidays taken by British residents, 2020-25
- Value forecast and prediction intervals for domestic holidays
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- Figure 57: Lower bound, central and upper bound forecast for the value of domestic holidays taken by British residents, 2020-25
- Volume forecast and prediction intervals for overseas holidays
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- Figure 58: Lower bound, central and upper bound forecast for the volume of overseas holidays taken by UK residents, 2020-25
- Value forecast and prediction intervals for overseas holidays
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- Figure 59: Lower bound, central and upper bound forecast for the value* of overseas holidays taken by UK residents, 2020-25
- Market drivers and assumptions
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- Figure 60: Key drivers affecting Mintel’s market forecast, 2020-24 (prepared 12 March 2021)
- Forecast methodology
Appendix – COVID Scenario Performance Methodology and Assumptions
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- Volume scenario performance for total holidays
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- Figure 61: COVID-19 scenario forecasts for the total volume of total holidays (domestic* and overseas) taken by UK residents, 2020-25
- Value scenario performance for total holidays
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- Figure 62: COVID-19 scenario forecasts for the value* of total holidays (domestic** and overseas) taken by UK residents, 2020-25
- Volume scenario performance for domestic holidays
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- Figure 63: COVID-19 scenario forecasts for the volume of domestic holidays taken by British residents, 2020-25
- Value scenario performance for domestic holidays
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- Figure 64: COVID-19 scenario forecasts for the value of domestic holidays taken by British residents, 2020-25
- Volume scenario performance for overseas holidays
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- Figure 65: COVID-19 scenario forecasts for the volume of overseas holidays taken by UK residents, 2020-25
- Value scenario performance for overseas holidays
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- Figure 66: COVID-19 scenario forecasts for the value* of overseas holidays taken by UK residents, 2020-25
- Rapid COVID recovery, central and extended COVID disruption scenarios outline
- Scenario methodology
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