2021
9
UK COVID-19 and Travel: A Year On Market Report 2021
2021-05-06T04:10:43+01:00
OX1044915
2195
137671
[{"name":"Holidays and Travel","url":"https:\/\/store.mintel.com\/industries\/holidays-travel"}]
Report
en_GB
“Ongoing uncertainty about the lifting of international travel restrictions will see more consumers opt for staycations, with an unprecedented number of travellers planning a holiday in the UK’s countryside. Consumers…

UK COVID-19 and Travel: A Year On Market Report 2021

£ 2,195 (Excl.Tax)

Report Summary

The UK COVID-19 And Travel: A Year On report identifies consumer attitudes towards booking behaviour, holidays, and long-term travel trends in the UK. The Market report covers the market size, market forecast, market segmentation, industry trends and the effect of the COVID-19 pandemic on the Travel market in the UK.

Current Market Landscape 

The national and international lockdowns from the COVID-19 pandemic saw holiday plans cancelled overnight, forcing many holidaymakers to remain in their houses for the majority of the year. This has increased the appeal of holidays for many consumers, looking to make up for lost time and reconnect with friends and family.

  • 17% of UK travellers planned to take a holiday of a lifetime once the coronavirus outbreak is over (up from 10% pre-pandemic)
  • 37% of domestic holidaymakers plan to take more staycations when the outbreak is over.
  • 21% of those who typically took short-haul holidays before the pandemic plan to take more holidays in Europe.
  • 30% of UK travellers plan to take a holiday with friends once the coronavirus outbreak is over, whilst 18% plan to take a multigenerational holiday.

The restrictions throughout 2020 and into 2021 has seen people wanting to take the holiday they have always dreamt of, such as a round-the-world trip. However, due to the ongoing uncertainty about the lifting of international travel restrictions, staycations have started to feel like a much safer option. Confidence in international travel will take time to full recover, with the value of domestic holidays expected to reach record highs over the next two years.

Future Market Trends in Travel

The speed of the recovery of the holiday market will be heavily dependent upon when and to what extent overseas travel restrictions are relaxed. The continuation of enforced testing and quarantine measures remains a significant barrier for many, as well as potential emergency of new vaccine-resistant strains of COVID-19 which would make governments more hesitant to allow non-essential travel to or from the affected regions.

When restrictions are relaxed, reconnecting with family and friends will be a key travel motivation. The vaccine rollouts throughout 2021 will make travellers feel more comfortable about returning to popular or busy holiday destinations, providing optimism for hard-hit segments such as cruises, group tours, and city breaks.

Holidaymakers in healthy financial situations will be looking to treat themselves by choosing more luxurious options than they usually do. However, nature-based and coastal breaks also have high growth potential, with many consumers opting for quieter areas to visit.

Read on to discover more details or take a look at all of our UK Holidays and Travel market research.

Quickly understand

  • The impact of COVID-19 on the UK travel market.
  • Trends in booking behaviour.
  • Holidaying intentions and likely behavioural changes in 2021.
  • Attitudes towards COVID-19 vaccines and travel.
  • Longer-term travel trends.

Covered in this report

Brands: Kuoni, Abercrombie & Kent, P&O Cruises, Club Med, Spotify.

Expert analysis from a specialist in the field

Written by Marloes-De-Vries, a leading analyst in the Travel sector, her extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Ongoing uncertainty about the lifting of international travel restrictions will see more consumers opt for staycations, with an unprecedented number of travellers planning a holiday in the UK’s countryside. Consumers who are still interested in holidaying overseas in the near future show a willingness to splash out on these trips. As a result, luxury holidays will be a more popular option in 2021, while more travellers will be looking to take a once-in-a-lifetime holiday once the threat of COVID-19 is very low.

Marloes-De-Vries
Associate Director – Travel

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • COVID-19: market context
    • Economic and other assumptions
    • Products covered in this Report
  2. Executive Summary

    • Impact of COVID-19 on the UK travel market
      • Figure 1: Impact of COVID-19 on the UK travel market, in short, medium and long term, 22 April 2021
    • The market
    • COVID-19 hits after holiday market reaches record heights
    • Value of domestic holiday market expected to reach record levels in 2021 and then again in 2022
      • Figure 2: COVID-19 scenario forecasts for the value of domestic holidays taken by British residents, 2015-25
    • International travel restrictions and lack of clarity delay the recovery of overseas travel…
    • …but an increase in average prices will mitigate some of the damage
      • Figure 3: COVID-19 scenario forecasts for the value* of overseas holidays taken by UK residents, 2015-25
    • The risk of vaccine-resistant strains of COVID-19 adds huge uncertainty
    • The UK’s countryside has the highest growth potential
    • Premiumisation is the biggest opportunity for overseas travel
    • Cost of COVID-19 tests puts nearly half of travellers off
    • High interest in integrating international travel restrictions in the planning and booking process
    • The consumer
    • The unveiling of the roadmap triggered more holiday bookings…
    • …but levels remain low compared to before COVID-19
    • Domestic travel market set to benefit from damaged confidence in overseas travel
      • Figure 4: Changes to holidaying frequency once the coronavirus outbreak is over, by destination, March 2021
    • The younger generation has remained most open to international travel, but will be price-sensitive
    • Reconnecting with family and friends is a key travel motivation
      • Figure 5: Holidaying intentions once the coronavirus outbreak is over, March 2021
    • COVID-19 has increased the desire to take a holiday of a lifetime
    • Majority of travellers are open to returning to tourism hotspots after vaccination
    • Hardest-hit segments can benefit from vaccination requirements for certain itineraries
      • Figure 6: Attitudes towards COVID-19 vaccines and travel, March 2021
    • Brits have not lost their appetite to travel
    • Increased focus on wellbeing provides opportunities for offering wellness experiences
      • Figure 7: Attitudes towards wellness and responsible travel, March 2021
    • Working holiday appeals to almost half of those who have flexibility on their working location
      • Figure 8: Interest in working holidays, by age, March 2021
  3. Impact of COVID-19 on Travel Segments

    • The pandemic has boosted the appeal of rural and coastal areas and self-catered options
    • Lack of overseas travel options has increased interest in rediscovering the UK
    • Subdued appeal of city breaks
    • Cruises and escorted tours have been particularly hard hit
  4. COVID-19 Consumer Timeline

    • Phase 1 – January-March: consumers go into lockdown
    • Phase 2 – March-June: adapting to life in lockdown
      • Figure 9: Recorded daily number of confirmed cases of COVID-19 and deaths registered as relating to the virus, 30 January-1 September 2020
    • Phase 3: emerging from the initial lockdown
    • Phase 4: rise of the next wave
      • Figure 10: Recorded daily number of confirmed cases of COVID-19, 30 January 2020-28 March 2021
    • Phase 5 – January-March: winter lockdown and vaccine rollout
      • Figure 11: Cumulative number of first and second vaccines delivered in the UK, 10 January-7 April 2021
    • Phase 6a – March onwards: the restart of domestic travel
    • Phase 6b – May onwards: the proposed restart of international travel
      • Figure 12: Traffic light system for international travel, as recommended by the Global Travel Taskforce on 9 April 2021
  5. The Post-pandemic Outlook for Travel

    • Staycation boom intensified amid uncertainty regarding the lifting of international travel restrictions
    • Demand for holiday rental properties will accelerate
    • The UK’s countryside has the highest growth potential
      • Figure 13: Participation and future ‘main holidaying’ intentions in the UK, by holiday type, February 2020 vs March 2021
    • Premiumisation is the biggest opportunity for overseas travel
    • Increased interest in nature-based breaks overseas
      • Figure 14: Participation and future ‘main holidaying’ intentions abroad, by holiday type, February 2020 vs March 2021
    • Cost of COVID-19 tests puts nearly half of travellers off
    • High interest in integrating international travel restrictions in the planning and booking process
  6. The Economic Impact

    • A record drop in economic activity…
      • Figure 15: Annual percentage change in GDP, 2007-25 (forecast)
    • …as COVID-19 restrictions caused a severe fall in spending
    • Consumer spending is heavily dependent on the path of the pandemic
      • Figure 16: Household consumption index, 2019-25 (scenario forecasts)
    • Furloughs have saved millions of jobs…
      • Figure 17: Number of employments furloughed, time series, March 2020-February 2021
    • …but unemployment is forecast to rise when state support ends
      • Figure 18: Quarterly unemployment rate, Q1 2008-Q1 2026 (forecast)
    • Under-25s have taken the brunt of COVID-19 job losses
      • Figure 19: Change in number of employees on payroll, by age, February 2021 vs February 2020
  7. Market Size and Performance

    • Impact of COVID-19 on the UK travel market
      • Figure 20: Impact of COVID-19 on the UK travel market, in short, medium and long term, 22 April 2021
    • COVID-19 hits after holiday market reaches record heights
      • Figure 21: Volume and value* of domestic holidays taken by British residents, 2015-20
      • Figure 22: Volume and value* of overseas holidays taken by UK residents, 2015-20
  8. Market Forecast

    • Value of domestic holiday market expected to reach record levels in 2021 and then again in 2022
      • Figure 23: Forecast volume of domestic holidays taken by British residents (prepared on 22 April 2021), 2015-25
      • Figure 24: Forecast value* of domestic holidays taken by British residents, at current prices, (prepared on 22 April 2021), 2015-25
    • International travel restrictions and lack of clarity delay the recovery of overseas travel
    • Many overseas 2021 summer holiday bookings have been lost…
      • Figure 25: Forecast volume of overseas holidays taken by UK residents (prepared on 22 April 2021), 2015-25
    • …but an increase in average prices will mitigate some of the damage
      • Figure 26: Forecast value* of overseas holidays taken by UK residents at current prices (prepared on 22 April 2021), 2015-25**
    • Longer-term prospects remain positive, but potential pandemics pose a significant threat
  9. COVID-19 Scenario Performance

    • Mintel’s approach to predicting the impact of COVID-19
    • Fundamental differences in how COVID-19 is affecting consumer markets
    • The risk of vaccine-resistant strains of COVID-19 adds huge uncertainty
    • A rapid COVID recovery will have less impact on the recovery of domestic travel
      • Figure 27: COVID-19 scenario forecasts for the value of domestic holidays taken by British residents, 2015-25
    • Extended COVID disruption will be disastrous for international travel
      • Figure 28: COVID-19 scenario forecasts for the value* of overseas holidays taken by UK residents, 2015-25
    • COVID-19 market disruption: risks and outcomes
      • Figure 29: Summary of Mintel scenario expectations and the impact on the holidays market, April 2021
  10. Consumer Concerns over the Impact on Health

    • Exposure anxieties align with case numbers
      • Figure 30: Mintel COVID-19 exposure anxiety and lifestyle impact index, 28 February 2020-12 March 2021
    • Exposure anxiety typically higher among over-55s
      • Figure 31: Proportion of adults indicating higher levels of anxiety (‘4’ or ‘5’) towards being exposed to the coronavirus, by age, 28 February 2020-26 March 2021
    • Middle-age band fear transmitting virus
  11. Consumer Concerns over the Impact on Lifestyles

    • Concerns about lifestyles impact outweigh exposure fears
    • Consumers react to unprecedented lifestyle restrictions
      • Figure 32: Mintel COVID-19 exposure anxiety and lifestyle impact index, 28 February 2020-12 March 2021
    • Lifestyle impact concerns high across all age groups
      • Figure 33: Proportion of adults indicating higher levels of anxiety (‘4’ or ‘5’) about how the outbreak could impact their lifestyle, by age, 28 February 2020-26 March 2021
  12. Impact on Household Finances

    • Financial wellbeing has hit new heights despite the crisis…
      • Figure 34: The financial wellbeing index, January 2015- March 2021
    • …but many still feel worse off than a year ago
      • Figure 35: Changes in household finances, January 2015- March 2021
    • One in six have been furloughed at least once
      • Figure 36: Impact of COVID-19 on employment and working patterns, February 2021
    • Income trends point to a two-track crisis and recovery
      • Figure 37: Impact of COVID-19 on personal income, February 2021
    • Cuts to discretionary spending have kept household finances afloat…
      • Figure 38: Impact of COVID-19 on household debts, February 2021
    • …and led to a record savings boost
      • Figure 39: Impact of COVID-19 on the value of savings in different products, February 2021
    • Most are optimistic about the year ahead…
      • Figure 40: The financial confidence index, January 2015-March 2021
    • …and looking forward to getting back to experiences
      • Figure 41: Financial priorities when COVID-19 is no longer a concern, February 2021
  13. Booking Intentions

    • The unveiling of the roadmap triggered more holiday bookings…
    • …but levels remain low compared to before COVID-19
    • The domestic holiday market benefited most from the uptick in bookings
      • Figure 42: Actual bookings and plans to book a holiday in the next three months, January 2019-March 2021
    • Over-55s remain cautious about booking holidays
      • Figure 43: Plans to book a holiday in the next three months, by age, January 2020-March 2021
  14. Future Holidaying Frequency by Destination

    • Domestic travel market set to benefit from damaged confidence in overseas travel
      • Figure 44: Changes to holidaying frequency once the coronavirus outbreak is over, by destination, March 2021
    • The younger generation has remained most open to international travel, but will be price-sensitive
      • Figure 45: Changes to holidaying frequency once the coronavirus outbreak is over, positive vs negative (percentage points)*, by age and destination, March 2021
    • Longer breaks will be popular in 2021
    • International travel restrictions will make overseas shorter breaks less appealing
      • Figure 46: The impact of COVID-19 on changes in holidaying intentions, March 2021
  15. Holidaying Intentions

    • Reconnecting with family and friends is a key travel motivation
      • Figure 47: Holidaying intentions once the coronavirus outbreak is over, March 2021
    • COVID-19 has increased the desire to take a holiday of a lifetime
      • Figure 48: Holidaying intentions once the coronavirus outbreak is over, by destination, March 2021
  16. Attitudes towards Travel

    • Majority of travellers are open to returning to tourism hotspots after vaccination
    • Hardest-hit segments can benefit from vaccination requirements for certain itineraries
      • Figure 49: Attitudes towards COVID-19 vaccines and travel, March 2021
    • Brits have not lost their appetite to travel
      • Figure 50: Attitudes towards travel, by demographics, March 2021
  17. Longer-term Travel Trends

    • Increased focus on wellbeing provides opportunities for offering wellness experiences
    • Travellers will want greener options moving forward
      • Figure 51: Attitudes towards wellness and responsible travel, March 2021
    • Over a third of those in full-time employment expect to work more from home in the future
      • Figure 52: Changes to working patterns once the coronavirus outbreak is over, by working status, March 2021
    • Working holiday appeals to almost half of those who have flexibility on their working location
      • Figure 53: Interest in working holidays, by age, March 2021
  18. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Consumer research methodology
  19. Appendix – Central Forecast Methodology

    • Volume forecast and prediction intervals for total holidays
      • Figure 54: Lower bound, central and upper bound forecast for the total volume of total holidays (domestic* and overseas) taken by UK residents, 2020-25
    • Value forecast and prediction intervals for total holidays
      • Figure 55: Lower bound, central and upper bound forecast for the value* of total holidays (domestic** and overseas) taken by UK residents, 2020-25
    • Volume forecast and prediction intervals for domestic holidays
      • Figure 56: Lower bound, central and upper bound forecast for the volume of domestic holidays taken by British residents, 2020-25
    • Value forecast and prediction intervals for domestic holidays
      • Figure 57: Lower bound, central and upper bound forecast for the value of domestic holidays taken by British residents, 2020-25
    • Volume forecast and prediction intervals for overseas holidays
      • Figure 58: Lower bound, central and upper bound forecast for the volume of overseas holidays taken by UK residents, 2020-25
    • Value forecast and prediction intervals for overseas holidays
      • Figure 59: Lower bound, central and upper bound forecast for the value* of overseas holidays taken by UK residents, 2020-25
    • Market drivers and assumptions
      • Figure 60: Key drivers affecting Mintel’s market forecast, 2020-24 (prepared 12 March 2021)
    • Forecast methodology
  20. Appendix – COVID Scenario Performance Methodology and Assumptions

    • Volume scenario performance for total holidays
      • Figure 61: COVID-19 scenario forecasts for the total volume of total holidays (domestic* and overseas) taken by UK residents, 2020-25
    • Value scenario performance for total holidays
      • Figure 62: COVID-19 scenario forecasts for the value* of total holidays (domestic** and overseas) taken by UK residents, 2020-25
    • Volume scenario performance for domestic holidays
      • Figure 63: COVID-19 scenario forecasts for the volume of domestic holidays taken by British residents, 2020-25
    • Value scenario performance for domestic holidays
      • Figure 64: COVID-19 scenario forecasts for the value of domestic holidays taken by British residents, 2020-25
    • Volume scenario performance for overseas holidays
      • Figure 65: COVID-19 scenario forecasts for the volume of overseas holidays taken by UK residents, 2020-25
    • Value scenario performance for overseas holidays
      • Figure 66: COVID-19 scenario forecasts for the value* of overseas holidays taken by UK residents, 2020-25
    • Rapid COVID recovery, central and extended COVID disruption scenarios outline
    • Scenario methodology

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