Table of Contents
Overview
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- What you need to know
- Covered in this Report
Executive Summary
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- Independent holidays see larger rise than packages in past 5 years…
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- Figure 1: Volume forecast of overseas independent holidays, 2012-22
- Figure 2: Volume forecast of overseas package holidays, 2012-22
- …but packages slightly ahead for ‘main holidays’ abroad
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- Figure 3: How people booked their ‘main holiday*’ in the past 12 months, February 2016-18
- Jet2holidays now second largest package brand behind TUI
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- Figure 4: Passengers licensed under ATOL protection, by top 10 ATOL holders, March 2018
- Cruise, escorted tours and luxury travel are key growth areas for the package market
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- Figure 5: How ‘main holiday’ types were booked in the past 12 months, February 2018
- Convenience is a core strength of package holidays
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- Figure 6: Reasons for booking package or independent holidays, February 2018
- Responsible reputation can raise brand appeal
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- Figure 7: Attitudes towards package holidays, February 2018
- Hassle-free holidays
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- Figure 8: Further attitudes towards package versus independent holidays, February 2018
- What we think
Issues and Insights
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- Personalisation is the key to attracting a new package generation
- The facts
- The implications
- The attraction of ‘re-bundled’ travel
- The facts
- The implications
The Market – What You Need to Know
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- City break revival boosts independent travel
- Package demand stable
- Customers looking for value outside Eurozone
- Long-haul luxury has become more affordable
- Fares should stay low…at least for now
Market Size and Forecast
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- Independent holidays have outperformed packages
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- Figure 9: Volume of overseas package and independent holidays, 2012-22
- Figure 10: Value* of overseas package and independent holidays, 2012-22
- Forecast
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- Figure 11: Volume forecast of overseas independent holidays, 2012-22
- Figure 12: Value* forecast of overseas independent holidays, 2012-22
- Figure 13: Volume forecast of overseas package holidays, 2012-22
- Figure 14: Value* forecast of overseas package holidays, 2012-22
Segment Performance
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- Spain top choice for Brits while Egypt back on the map
- Turkey, Croatia and Bulgaria expected to see strong package growth
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- Figure 15: Overseas package holiday volumes, October-September 2015-17
- City break revival boosting independent travel
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- Figure 16: Overseas independent holiday volumes, October-September 2015-17
- Time-poor travellers seeking shorter breaks
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- Figure 17: Package versus independent holiday volumes by trip duration, October-September 2015-17
Market Background
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- Cautious consumers
- Pound still weak but has steadied
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- Figure 18: Spot exchange rate, Pound Sterling vs Euro and US$, June 2016-March 2018
- Oil price rising but fares likely to stay low for now
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- Figure 19: Average European Brent Crude oil prices, 2013-March 2018
- Cost of holidaying in Europe has risen sharply in 2018
- Consumer seeking cheaper alternatives
- Caribbean & Dubai have increased in value for money
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- Figure 20: Post Office travel cost barometer for popular resort destinations, 2017-18
- New package regulations
Key Players & Products – What You Need to Know
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- Jet2holidays overtakes Thomas Cook
- TUI/Cook target the Airbnb generation
- We Love Holidays becomes fifth OTA to enter top ten package ranking
- Monarch’s collapse boosts Jet2 & easyJet
- Packages get personal
Market Share
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- Big two become big three
- The rise of Jet2holidays
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- Figure 21: Passengers licensed under ATOL protection, by top 10 ATOL holders, 2012-18
- Half of top ten package brands are OTAs
- Airlines entering package space
Launch Activity and Innovation
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- TUI’s third way
- Thomas Cook extends choice to sunbeds and rooms
- Kuoni to launch new online tailor-made brand
- Phased package holidays
- TUI continues own-brand strategy...
- …and Thomas Cook follows suit
The Consumer – What You Need to Know
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- ‘Main holidays’ abroad show slight package bias
- Generational divide
- All-inclusive surge
- Package holidays remove hassle
- Independent travel offers flexibility and choice
- Tailor-made potential is strong amongst Millennials
- Packages work best for more unusual trips
Package versus Independent Bookings
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- Package versus independent split unchanged
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- Figure 22: How people booked their ‘main holiday’ in the past 12 months, February 2016-18
- Package has slight lead for ‘main holidays’ abroad
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- Figure 23: How people booked their ‘main holiday’ in the past 12 months, UK versus overseas, February 2018
- Over-55s most likely to book a package
- Singles under-represented in package market
- Package has the broadest socio-economic appeal
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- Figure 24: How people booked their ‘main holiday’ overseas in the past 12 months, by demographics, February 2018
- Two thirds book all-inclusive package
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- Figure 25: All-inclusive holiday booking in the past 12 months, February 2017-18
Holiday Types
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- Half of ‘main holidays’ to Europe are beach resort trips
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- Figure 26: Type of ‘main holiday’ taken in the past 12 months, February 2018
- Package booking dominates cruise, escorted tours and luxury travel
- OTAs are growing in the luxury travel space
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- Figure 27: How ‘main holiday’ types were booked in the past 12 months, February 2018
Reasons for Booking Package versus Independent Holidays
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- Convenience is key attraction for packages
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- Figure 28: Reasons for booking package or independent holidays, February 2018
- Extras, security and expertise additional package attractions
- Flexibility and choice seen as strengths of independent booking
Attitudes towards Package versus Independent Holidays
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- Expertise can make critical difference to customer satisfaction
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- Figure 29: Satisfaction with ‘main holiday’ over the past 12 months, by package versus independent holidays, February 2018
- Millennials prepared to pay for personalisation
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- Figure 30: Target groups based on statements about holidays – CHAID – Table output, February 2018
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- Figure 31: Target groups based on statements about holidays – CHAID – Tree output, February 2018
- Half prefer to book with responsible brands
- Rising demand for all-inclusive presents ethical challenge
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- Figure 32: Attitudes towards package holidays, February 2018
- Package holidaymakers favour specialist brands
- Younger generations looking for ways to maintain holiday habit
- Hassle-free package appeal
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- Figure 33: Further attitudes towards package versus independent holidays, February 2018
- Packages seen as best for the complex and unfamiliar
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- Figure 34: Further attitudes towards package versus independent holidays, by how last ‘main holiday’ was booked, February 2018
- Embrace package authenticity and individuality to broaden appeal
Appendix – Data Sources, Abbreviations and Supporting Information
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- Definitions
- Abbreviations
- Consumer research methodology
- CHAID methodology
Appendix – Market Size and Forecast
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- Figure 35: Package holidays, volume forecast, 2017-22
- Figure 36: Package holidays, value* forecast, 2017-22
- Figure 37: Independent holidays, volume forecast, 2017-22
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- Figure 38: Independent holidays, value* forecast, 2017-22
- Forecast methodology
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