Short and City Breaks - UK - July 2017

OVERVIEW
What you need to know
Covered in this Report
EXECUTIVE SUMMARY
Short breaks abroad up 41% in three years but pace likely to slow
Figure 1: Domestic short break market volume forecast, 2012-22
Figure 2: Overseas short break market volume forecast, 2012-22
Breaks to Spain, Netherlands and Eastern Europe have risen
Figure 3: Top 10 countries for short breaks (1-3 nights) abroad, by volume, 2016
Beach/culture breaks offer value for money
Figure 4: Top 10 lowest city break costs* 2017
Luxury, rural and Northern Lights breaks have biggest potential
Figure 5: Types of short break taken in the past 12 months and future interest, May 2017
OTAs take half of overseas bookings
Figure 6: How last short break was booked, May 2017
History/culture, hidden places and lure of the live
Figure 7: Activities people are interested in doing on city breaks, May 2017
Gateway to the new
Figure 8: Agreement with further attitudinal statements towards short and city breaks, May 2017
What we think
ISSUES AND INSIGHTS
Targeting spontaneous bookers
The facts
The implications
Niche package opportunities
The facts
The implications
Greener city breaks for older travellers
The facts
The implications
Cutbacks, budget breaks and spirit of lagom
The facts
The implications
Rural retreats
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Domestic breaks flat/overseas breaks surge in 2016
New era of uncertainty ahead
London could suffer similar impact to Paris
Breaks to Eastern Europe up 30% in 2016
Consumers continue to benefit from low fares …
…but city break costs are up 28% this year
MARKET SIZE AND FORECAST
Overall short break numbers up 2% in 2016
Figure 9: Total short breaks (1-3 nights) taken by UK residents, by volume and value*, 2012-22
Figure 10: Total short break market volume forecast, 2012-22
Figure 11: Total short break market value* forecast, 2012-22
Domestic short breaks remain flat …
Figure 12: Domestic short breaks (1-3 nights) taken by UK residents, by volume and value, 2012-22
Figure 13: Domestic short break market volume forecast, 2012-22
Figure 14: Domestic short break market value* forecast, 2012-22
…but short breaks abroad continue to surge
Figure 15: Overseas short breaks (1-3 nights) taken by UK residents, by volume and value, 2012-22
Figure 16: Overseas short break market volume forecast, 2012-22
Figure 17: Overseas short break market value* forecast, 2012-22
Slowdown expected as economic picture worsens
SEGMENT PERFORMANCE
South West/North West are leading UK regions
Figure 18: Estimated number of domestic (1-3 night) short breaks, by region, 2016
Trips to France have declined as Spain and Netherlands catch up
Eastern Europe also a growth area
Figure 19: Top 10 countries for short breaks (1-3 nights) abroad, by volume, 2014-16
Flights take off but trips through Tunnel derailed
Figure 20: Number of short breaks (1-3 nights) abroad, by mode of travel, 2012-16
Package share has declined
Figure 21: Number of short breaks (1-3 nights) abroad, independent versus package, 2012-16
Year-round strength of short break market
Figure 22: Percentage split by quarter of short breaks (1-3 nights) versus all holidays abroad, 2016
Figure 23: Estimated percentage split by quarter of short breaks (1-3 nights) versus all domestic holidays, 2016
Short breakers are high spenders
Figure 24: Estimated spend per night of short breaks (1-3 nights) versus all holidays, 2016
MARKET BACKGROUND
Wages squeezed in gig economy
Figure 25: UK average weekly earnings (excluding bonuses)* vs CPI inflation, percentage change year on year, January 2014-May 2017
Pound suffers double-digit drop since Referendum
Figure 26: Spot exchange rate, Pound Sterling versus selected currencies, June 2016-June 2017
Low oil price remains a helpful factor for travel …
Figure 27: European Brent crude prices, January 2014-May 2017
Figure 28: Petrol costs (unleaded 95 octane), January 2014-May 2017
…but other city break costs have risen steeply
Sunshine and sightseeing breaks offer relatively good value
Eastern Europe still the cheapest
Figure 29: City break costs* 2017 versus 2016
LAUNCH ACTIVITY – WHAT YOU NEED TO KNOW
Tour operators challenging OTAs
New active short breaks
Special occasion families
Going underground and off-piste in the city
Online giants developing city break apps
LAUNCH ACTIVITY AND NEW PRODUCT DEVELOPMENT
New packaged product challenges OTAs
Active UK mini-breaks
Multi-generational family breaks
Local experiences in the city
Battle of the city break apps
All you can fly
THE CONSUMER – WHAT YOU NEED TO KNOW
Coast and city equally popular
Escape to the country
Seeing the light
Millennials and well-off seniors are key groups
One in four breaks booked last minute
Hidden city
Keeping it real
Uncertainties likely to affect market
Short breaks are associated with novelty
Shorter and sweeter
PARTICIPATION AND INTEREST
Six in ten adults take short breaks
Londoners go for luxury
Figure 30: Types of short break taken in the past 12 months and future interest, May 2017
Luxury, rural and Northern Lights breaks show largest growth potential
Figure 31: Percentage-point difference between types of short break taken in the past 12 months and future interest, May 2017
Serial Short Breakers
Figure 32: Number of short breaks taken in the past 12 months, May 2017
Millennials are the leading overseas short breakers
Figure 33: Destination of last short break, May 2017
BOOKING SHORT AND CITY BREAKS
Spirit of spontaneity
Figure 34: When last short break was booked, May 2017
Half of short breaks abroad booked via OTAs
Figure 35: How last short break was booked, May 2017
PREFERRED ACTIVITIES ON CITY BREAKS
City breakers seek history, culture and hidden places
Figure 36: Activities people are interested in doing on city breaks, May 2017
Greening the city
Live action
Career-change breaks
Urban treasure hunts
SHORT AND CITY BREAKS ATTITUDES
Cost of living crisis could deter half of short breakers
Security worries are a growing influence
Figure 37: Agreement with attitudinal statements towards short and city breaks, May 2017
Those who take just one or two breaks are most likely to cut back
Figure 38: Agreement with attitudinalstatements towards short and city breaks, by numbers of breaks taken in past 12 months, May 2017
Short breaks offer opportunity for diversification
New little and often tribe is emerging
Helping people to switch off
Figure 39: Agreement with further attitudinal statements towards short and city breaks, May 2017
CHAID ANALYSIS
Methodology
Figure 40: Target groups based on attitudes towards short breaks – CHAID – Tree output, May 2017
Young family consumers are the most likely to cut back
APPENDIX
Definitions
Abbreviations