Travel Trends Show Consumers Prefer Experience Over Material
Travel trends change daily, and wanderlust is a bug that bites you when you least expect it. This year, more people are hitting the skies, filling the hotels, and flooding the theme parks.
More so, even amongst inflation rates, consumers are showing a willingness to spend a little more on their trips.
CNBC reported that the uptick in travel makes way for the "fiercest holiday season battle for consumers' wallets since before the COVID pandemic."
Retailers have also struggled to bring customers back after they bought a lot of things during the pandemic. Shoppers have also become more budget-conscious and prefer sustainability.
Travel Trends Aim Toward Experiences
Companies like Delta Air, Mastercard, and Airbnb have seen a great year of recovery. While Starbucks said customers shell out more for pricier drinks, companies like Live Nation report double-digit growth for theaters, stadiums, and festivals.
"We saw notable strength in airline, lodging and restaurant spend with a shift away from categories like home furnishings and appliances," said Mastercard CEO Michael Miebach.
The increase in travel trends has put retailers like Amazon, who reported lower earnings in October, on caution for tougher times.
FedEX CEO Raj Subramaniam also anticipates a worldwide recession. Retail sales flattened in September, and since results are not inflation-adjusted, it shows a sign of inflation taking its toll.
Travel Spending Continues to Soar
Flexible job opportunities have allowed people to travel more in the offseason. Hawaiian Airlines CEO Peter Ingram noted that people feel entitled to vacation after being deprived during COVID.
Even though airfaire was up 43%, Bank of America Institute economist Anna Zhou said, "Travel remains extremely resilient."
Out of all the companies worried, airlines and hotels dismiss any notions of a recession. However, stats also show that Americans spend more than they make. Wells Fargo senior economist Tim Quinlan says the consumers are on borrowed time with the unsustainable tradeoff in income versus spending.
"When you have times of stress and uncertainy, we're more likely to see that YOLO (you only live once) behavior happening," said Jorge Barraza, assistant professor of consumer psychology at the University of Southern California.
