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PACKAGE VS INDEPENDENT HOLIDAYS - UK - APRIL 2018

Published By :

Mintel

Published Date : Apr 2018

Category :

Travel Services

No. of Pages : N/A

Mintel’s research shows that those who book ‘pure packages’ are the most likely travellers to record high customer satisfaction levels. Convenience and the removal of travel stress are key selling-points for package brands.

Table of contents

OVERVIEW
What you need to know
Covered in this Report
EXECUTIVE SUMMARY
Independent holidays see larger rise than packages in past 5 years…
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
Figure 3: How people booked their ‘main holiday*’ in the past 12 months, February 2016-18
Jet2holidays now second largest package brand behind TUI
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
Figure 5: How ‘main holiday’ types were booked in the past 12 months, February 2018
Convenience is a core strength of package holidays
Figure 6: Reasons for booking package or independent holidays, February 2018
Responsible reputation can raise brand appeal
Figure 7: Attitudes towards package holidays, February 2018
Hassle-free holidays
Figure 8: Further attitudes towards package versus independent holidays, February 2018
What we think
ISSUES AND INSIGHTS
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
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
Independent holidays have outperformed packages
Figure 9: Volume of overseas package and independent holidays, 2012-22
Figure 10: Value* of overseas package and independent holidays, 2012-22
Forecast
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
Spain top choice for Brits while Egypt back on the map
Turkey, Croatia and Bulgaria expected to see strong package growth
Figure 15: Overseas package holiday volumes, October-September 2015-17
City break revival boosting independent travel
Figure 16: Overseas independent holiday volumes, October-September 2015-17
Time-poor travellers seeking shorter breaks
Figure 17: Package versus independent holiday volumes by trip duration, October-September 2015-17
MARKET BACKGROUND
Cautious consumers
Pound still weak but has steadied
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
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
Figure 20: Post Office travel cost barometer for popular resort destinations, 2017-18
New package regulations
KEY PLAYERS & PRODUCTS – WHAT YOU NEED TO KNOW
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
Big two become big three
The rise of Jet2holidays
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
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
‘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
Package versus independent split unchanged
Figure 22: How people booked their ‘main holiday’ in the past 12 months, February 2016-18
Package has slight lead for ‘main holidays’ abroad
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
Figure 24: How people booked their ‘main holiday’ overseas in the past 12 months, by demographics, February 2018
Two thirds book all-inclusive package
Figure 25: All-inclusive holiday booking in the past 12 months, February 2017-18
HOLIDAY TYPES
Half of ‘main holidays’ to Europe are beach resort trips
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
Figure 27: How ‘main holiday’ types were booked in the past 12 months, February 2018
REASONS FOR BOOKING PACKAGE VERSUS INDEPENDENT HOLIDAYS
Convenience is key attraction for packages
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
Expertise can make critical difference to customer satisfaction
Figure 29: Satisfaction with ‘main holiday’ over the past 12 months, by package versus independent holidays, February 2018
Millennials prepared to pay for personalisation
Figure 30: Target groups based on statements about holidays – CHAID – Table output, February 2018
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
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
Figure 33: Further attitudes towards package versus independent holidays, February 2018
Packages seen as best for the complex and unfamiliar
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
Definitions
Abbreviations
Consumer research methodology
CHAID methodology
APPENDIX – MARKET SIZE AND FORECAST
Figure 35: Package holidays, volume forecast, 2017-22
Figure 36: Package holidays, value* forecast, 2017-22
Figure 37: Independent holidays, volume forecast, 2017-22
Figure 38: Independent holidays, value* forecast, 2017-22
Forecast methodology

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