Although the share of online bookings for holidays was already high prior to the pandemic, it is expected to increase further due to increased interest among over-55s to book online. 77% of over-55s had booked or were planning to book their main holiday in the 12 months following March 2021 online, up from 70% who booked online prior to the pandemic. Increased online activities during the pandemic are likely to have made this demographic more confident in making online transactions.

The domestic holiday market has benefited from the cautious approach of the UK government to restart international travel. The share of Brits planning to take their main holiday in the UK now exceeds pre-COVID-19 levels, while the initial enthusiasm about travelling overseas has subsided. Encouraging bookings for the late-summer and winter season will become increasingly important as many will be reluctant to travel abroad in the short term.

The speed of recovery will depend heavily on the easing of restrictions by both the UK government and the destination itself, while a vaccine-resistant mutation of COVID-19 will be disastrous for international travel. Amid the maze of rules, travellers will be looking for reassurance and simplicity when making their holiday arrangements.

There is also a group of consumers keen to splash out on travel to make up for a prolonged period with limited options to travel. Brands have the opportunity to enrich the holiday planning and booking process with options to upgrade to more premium options, longer stays or add-on experiences.

Key issues covered in this Report

  • The impact of COVID-19 on the domestic and overseas holiday markets.

  • Trends in booking intentions and bookings.

  • Holiday booking channel and research sources.

  • Purchase drivers when choosing a travel company.

  • Attitudes towards entry requirements.

  • Consumers’ perceptions of seven key players in the holiday market.

COVID-19: market context (created on 25 June 2021)

The first COVID-19 cases were confirmed in the UK at the end of January 2020, with a small number of cases in February. Rapidly rising case numbers led to the first national lockdown, starting on 23 March. It wasn't until 15 June that non-essential stores were allowed to reopen, followed by pubs, restaurants, hotels and hairdressers on 4 July and many beauty businesses on 13 July.

By September, it had become clear that the UK was at the start of a second wave, and social distancing measures were intensified. Continued increases in infection numbers led to Wales implementing a two-week national lockdown from 19 October, England announcing a month-long lockdown from 5 November and Scotland introducing a new five-level system of coronavirus restrictions.

Despite these restrictions, however, case numbers continued to increase. All four UK nations tightened restrictions further in January 2021, effectively leading to a full UK-wide lockdown.

On 22 February, Boris Johnson announced the roadmap to an easing of restrictions in England, starting with the reopening of schools on 8 March, followed by easing of restrictions on outdoor gatherings on 29 March and with a hoped end to all restrictions by 21 June. The Welsh and Scottish governments also gave more details on their plans to ease restrictions, with both nations taking a slightly more cautious approach to the one planned for England.

In England domestic holidays in self-contained accommodation were allowed on 12 April, with the rest of the accommodation sector allowed to open on 17 May. Stays remain subject to stage three social mixing rules, which limit indoor gatherings to six people or two households.

On 9 April, the Global Travel Taskforce published a report with recommendations for the restart of international travel, which includes a traffic light system. On 7 May 2021, the UK government revealed the countries rated as red, amber or green and confirmed that international travel will be allowed from England from 17 May. In total, 12 countries had been added to the green list, with Portugal being the only green list destination from the 20-most visited destinations for a holiday abroad. However, during the first three-weekly review, on 3 June, the government announced no countries will be added to the green list at this stage. It also announced that Portugal would be moved to the amber list from Tuesday 8 June 2021 at 4am due to variants of concern and emerging mutations, while seven countries would be added to the red list.

On 14 June 2021, the UK government postponed the last step on the roadmap out of lockdown due to concerns about the exponential growth in COVID-19 cases driven by the Delta variant. This will see step 4 happening on 19 July rather than 21 June, to allow the vaccination programme to catch up. Some countries, such as Germany, Austria, the Netherlands and Italy, have imposed stricter entry requirements on arrivals from the UK, while others, such as Spain, Portugal and Greece, have relaxed measures.

The second three-weekly review of the traffic light list took place on 24 June 2021. The UK government announced that six countries will be added to the red list from 30 June, while 16 destinations and UK Overseas Territories will be added to the green list. However, all additions to the green list, with the exception of Malta, will also join the ‘green watchlist’, which indicates that these destinations are at risk of moving from green to amber. Israel and Jerusalem, which had already been on the initial green list, have been added to the ‘green watchlist’ too.

The UK’s vaccination programme started on 8 December 2020, and with the Pfizer-BioNTech, Moderna and Oxford-AstraZeneca vaccines licensed for use in the UK. On 19 May, 2021 the government announced that more than 70% of UK adults had received their first dose of the vaccine and that nearly 40% had received their second dose.

Economic and other assumptions

Mintel’s economic assumptions are based on the Office for Budget Responsibility’s central scenario included in its March 2021 Economic and Fiscal Outlook Report. After the fall of 9.9% over the course of 2020, the scenario suggests that UK GDP will grow by 4% in 2021 and 7.3% in 2022.

GDP isn’t expected to return to pre-COVID-19 levels until Q2 2022, although this is six months earlier than the OBR forecast in November 2020, mainly because of the faster-than-expected rollout of vaccines.

Unemployment is expected to peak at 6.5% in Q4 2021. As with GDP, this is more positive than the OBR’s November forecast, but the OBR does raise the prospect of long-term scarring on employment, especially in the more exposed retail and hospitality sectors.

An overview of all assumptions used to inform analysis is included in the COVID-19 Scenario Performance section.

Products covered in this Report

For the purposes of this Report, Mintel has used the following definitions:

This Report examines the behaviours and attitudes of UK adults concerning how they research and book domestic and overseas holidays. Mintel defines a holiday as a stay of at least one night that is primarily for leisure purposes. Business trips and visiting friends or relatives are not included.

An adult, for the purposes of Mintel’s research, is anyone aged 16 or over.

For the purposes of this Report, Mintel asked a number of questions to UK adults about the ‘main holiday’ they are planning to take in the next 12 months. This was defined as the holiday on which they had spent the most in terms of travel and accommodation.

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