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UK Travel Retail market report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Travel Retail market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry and how fast are its rates of growth? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Products covered in this Report

This Report is designed to give an overview of the travel retail market within the UK. It includes research on motorway service area (MSA), railway station and airport terminal retailing, as well as limited analysis for comparison of the foodservice offering within each hub. It combines market data, including drivers in the market and detailed information on the key players, along with Mintel’s consumer research to build a picture of the travel retail market.

Our consumer research supplied within this Report covers the following areas:

  • Which travel hubs have been visited in the last 12 months and how frequently do people visit?
  • What products have consumers purchased from retail outlets in each of the three travel hubs in the past 12 months?
  • The reasons for buying products from a retailer within a travel hub.
  • The reasons for not buying products from a retailer within a travel hub.
  • What would encourage consumers to shop at retail outlets within travel hubs?
  • Attitudes towards shopping in travel hubs.

Expert analysis from a specialist in the field

Written by Samantha Dover, a leading analyst in the Retail sector, her extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

The ongoing investment into some of the UK’s largest travel hubs is changing the face of travel retail and presenting retailers with new opportunities to enter the market. Whilst food remains the primary reason to shop in a travel hub, the ongoing development of the sector will only help to convince consumers that travel hubs can be retail destinations in their own right which could in turn encourage more purchases in other categories. However, a significant challenge remains in pricing as this continues to be a major factor in why people avoid shopping in travel hubs. Samantha Dover
Retail Analyst

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • Online takes the lion’s share of holiday bookings
              • OTAs the leading single booking channel
                • Figure 1: Estimated number of people who booked a holiday online, by channel, 2017
              • Holiday planning cycle remains consistent
                • Figure 2: Consumer plans to book a holiday within the next three months, June 2012-March 2018
              • Income squeeze abates as wage growth overtakes inflation
                • Figure 3: Average wage growth and consumer price inflation, March 2014-March 2018
              • OTA usage remains stable
                • Monarch collapse prompts investigation into traveller protections
                  • Digital assistants increasing presence in the home
                    • Social competes for space in the booking process…
                      • …but search is better placed to serve holidaymakers
                        • The travel app economy continues to grow
                          • Figure 4: Total downloads in the UK for apps in the Travel category on the iOS App Store and the Travel & Local category on Google Play combined, 2015-17
                          • Figure 5: Total time spent in the Travel & Local category on Android* phones in the UK, 2015-17
                          • Figure 6: Total sessions in apps in the Travel & Local category on Android* phones in the UK, 2015-17
                        • Companies and brands
                          • Booking.com increases penetration in the OTA market
                            • Expedia group second-largest supplier of OTA services
                              • TripAdvisor expands its reach as an OTA
                                • Figure 7: Market penetration of travel comparison websites/apps, based on online holiday booking behaviour in the last 12 months, April 2018
                              • Travellers embrace OTA apps
                                • Figure 8: Ranking of top OTA apps according to average monthly active users on iPhone and Android phones in the UK, 2017
                              • Expedia adds concert tickets to its platform
                                • Customers get more transparency from a Holiday Value Index tool
                                  • Facebook advertising targets those considering travel
                                    • Trivago continues to dominate advertising spend
                                      • Figure 9: Total above-the-line, online display and direct mail advertising expenditure on online travel/booking agents, by advertiser, 2017
                                    • The consumer
                                      • Online remains most popular booking channel
                                        • Figure 10: Ways in which consumers booked their holidays in the last 12 months, April 2018
                                      • Converting research into bookings
                                        • Figure 11: Providers used to research and book holidays online in the last 12 months, April 2018
                                      • OTAs a popular option for short-haul trips
                                        • Figure 12: Type of holiday most recently booked via travel comparison websites/apps, April 2018
                                      • At least 48% of holidays abroad are not ATOL protected
                                        • Accommodation-only bookings reserved for UK trips
                                          • Figure 13: Services booked via travel comparison websites/apps for the most recent holiday, by type of holiday booked, April 2018
                                        • Laptops and desktops remain the preferred option for holiday bookings
                                          • Figure 14: Devices used for research and booking holidays via travel comparison websites/apps, April 2018
                                        • Consumers compare their comparison sites
                                          • Consumers receptive to reward schemes
                                            • Figure 15: Consumer behaviour related to travel comparison sites/apps, April 2018
                                          • Protections available to holidaymakers
                                            • Chatbots may change the holiday booking process
                                              • An activity-first search appeals to over half of consumers
                                                • Travellers are engaged in the holiday planning process
                                                  • Figure 16: Attitudes towards holiday planning and booking processes, April 2018
                                                • Consumers still perceive OTAs as better value than traditional travel agents
                                                  • Piecemeal booking styles seems here to stay
                                                    • What we think
                                                    • Issues and Insights

                                                      • Increasing OTA access points
                                                        • The facts
                                                          • The implications
                                                            • Increasing loyalty in OTAs
                                                              • The facts
                                                                • The implications
                                                                • The Market – What You Need to Know

                                                                  • Online takes the lion’s share of holiday bookings
                                                                    • OTAs the leading single booking channel
                                                                      • Holiday planning cycle remains consistent
                                                                        • Income squeeze abates as wage growth overtakes inflation
                                                                          • OTA usage remains steady but tour operator use spikes
                                                                            • Monarch collapse prompts investigation into traveller protections
                                                                              • Digital assistants increasing presence in the home
                                                                                • Social competes for space in the booking process
                                                                                  • Search is better placed to serve holidaymakers
                                                                                    • The travel app economy continues to grow
                                                                                    • Market Size and Segmentation

                                                                                      • Online takes the lion’s share of holiday bookings
                                                                                        • Figure 17: Estimated number of people who booked a holiday, 2017
                                                                                      • OTAs the leading single booking channel
                                                                                        • Figure 18: Estimated number of people who booked a holiday online, by channel, 2017
                                                                                    • Market Background and Drivers

                                                                                      • Holiday planning cycle remains consistent
                                                                                        • Figure 19: Consumer plans to book a holiday within the next three months, June 2012-March 2018
                                                                                      • Income squeeze abates as wage growth overtakes inflation
                                                                                        • Figure 20: Average wage growth and consumer price inflation, March 2014-March 2018
                                                                                      • OTA usage remains steady but tour operator use spikes
                                                                                        • Figure 21: Websites/apps used to book holiday, 2015-18
                                                                                      • CMA investigates OTA selling practices
                                                                                        • Monarch collapse prompts investigation into traveller protections
                                                                                          • Digital assistants increasing presence in the home
                                                                                            • Social competes for space in the booking process…
                                                                                              • …but search is better placed to serve holidaymakers
                                                                                                • Figure 22: Google’s integrated hotel booking option in search
                                                                                              • The travel app economy continues to grow
                                                                                                • Figure 23: Total downloads in the UK for apps in the Travel category on the iOS App Store and the Travel & Local category on Google Play combined, 2015-17
                                                                                                • Figure 24: Total time spent in the Travel & Local category on Android* phones in the UK, 2015-17
                                                                                                • Figure 25: Total sessions in apps in the Travel & Local category on Android* phones in the UK, 2015-17
                                                                                              • Airline and direct booking apps competing with OTAs
                                                                                              • Companies and Brands – What You Need to Know

                                                                                                • Booking has highest penetration in the OTA market
                                                                                                  • Expedia Group second-largest supplier of OTA services
                                                                                                    • TripAdvisor expands its reach
                                                                                                      • Travellers embrace OTA apps
                                                                                                        • Expedia adds concert tickets to its platform
                                                                                                          • Expedia offers Holiday Value Index tool
                                                                                                            • Thomas Cook announces strategic alliance with Expedia
                                                                                                              • TripAdvisor launches Sponsored Placements
                                                                                                                • Trivago continues to dominate advertising spend
                                                                                                                • Market Share

                                                                                                                  • Booking.com increases penetration in the OTA market
                                                                                                                    • Expedia group second-largest supplier of OTA services
                                                                                                                      • TripAdvisor expands its reach as an OTA
                                                                                                                        • Figure 26: Market penetration of travel comparison websites/apps, based on online holiday booking behaviour in the last 12 months, April 2018
                                                                                                                      • Travellers embrace OTA apps
                                                                                                                        • Figure 27: Ranking of top OTA apps according to average monthly active users on iPhone and Android phones in the UK, 2017
                                                                                                                    • Launch Activity and Innovation

                                                                                                                      • Expedia adds concert tickets to its platform
                                                                                                                        • Customers get more transparency from a Holiday Value Index tool
                                                                                                                          • Thomas Cook announces strategic alliance with Expedia
                                                                                                                            • Facebook advertising targets those considering travel
                                                                                                                              • TripAdvisor launches Sponsored Placements
                                                                                                                              • Advertising and Marketing Activity

                                                                                                                                • Advertising continues its move to digital
                                                                                                                                  • Figure 28: Total above-the-line, online display and direct mail advertising expenditure on online travel/booking agents, by media type, 2015-17
                                                                                                                                • Trivago continues to dominate advertising spend
                                                                                                                                  • Figure 29: Total above-the-line, online display and direct mail advertising expenditure on online travel/booking agents, by advertiser, 2017
                                                                                                                                • Nielsen Ad Intel coverage
                                                                                                                                • Brand Research

                                                                                                                                    • Brand map
                                                                                                                                      • Figure 30: Attitudes towards and usage of selected brands, April 2018
                                                                                                                                    • Key brand metrics
                                                                                                                                      • Figure 31: Key metrics for selected brands, April 2018
                                                                                                                                    • Brand attitudes: TripAdvisor leads in consumer trust and perception of quality
                                                                                                                                      • Figure 32: Attitudes, by brand, April 2018
                                                                                                                                    • Brand personality: Trivago and TripAdvisor seen as fun options
                                                                                                                                      • Figure 33: Brand personality – Macro image, April 2018
                                                                                                                                    • Hotels.com lowest across brands in perceptions of reliability and efficiency
                                                                                                                                      • Figure 34: Brand personality – Micro image, April 2018
                                                                                                                                    • Brand analysis
                                                                                                                                      • TripAdvisor’s extensive reviews make place it the most-used brand overall
                                                                                                                                        • Figure 35: User profile of TripAdvisor, April 2018
                                                                                                                                      • Booking.com’s market leading position driven by its efficient focus on value
                                                                                                                                        • Figure 36: User profile of Booking.com, April 2018
                                                                                                                                      • Expedia playing catch-up to Booking.com and Trivago in terms of brand image
                                                                                                                                        • Figure 37: User profile of Expedia, April 2018
                                                                                                                                      • Marketing effectively boosts Trivago’s appeal and reach
                                                                                                                                        • Figure 38: User profile of Trivago, April 2018
                                                                                                                                      • Hotels.com suffers from a lack of perceived trust and innovativeness
                                                                                                                                        • Figure 39: User profile of Hotels.com, April 2018
                                                                                                                                    • The Consumer – What You Need to Know

                                                                                                                                      • Online remains most popular booking channel
                                                                                                                                        • Converting research into bookings
                                                                                                                                          • OTAs a popular option for short-haul trips
                                                                                                                                            • A third of most recent holidays were packages
                                                                                                                                              • Laptops and desktops remain the preferred option for holiday bookings
                                                                                                                                                • Consumers compare their comparison sites
                                                                                                                                                  • Consumers receptive to reward schemes
                                                                                                                                                    • Chatbots may change the holiday booking process
                                                                                                                                                      • An activity-first search appeals to over half of consumers
                                                                                                                                                        • Travellers are engaged in the holiday planning process
                                                                                                                                                          • Piecemeal holiday booking looks likely to stay
                                                                                                                                                          • Holiday Booking Channels

                                                                                                                                                            • Online remains most popular booking channel
                                                                                                                                                              • Figure 40: Proportion of consumers who booked a holiday in the last 12 months, April 2018
                                                                                                                                                              • Figure 41: Ways in which consumers booked their holidays in the last 12 months, April 2018
                                                                                                                                                            • Converting research into bookings
                                                                                                                                                              • Adding complexity to the booking process
                                                                                                                                                                • Figure 42: Providers used to research and book holidays online in the last 12 months, April 2018
                                                                                                                                                              • Travel comparison favours a younger market…
                                                                                                                                                                • Figure 43: Providers used to research and book holidays online in the last 12 months, by age, April 2018
                                                                                                                                                            • Holidays Booked through Online Travel Aggregators

                                                                                                                                                              • OTAs a popular option for short-haul trips
                                                                                                                                                                • Figure 44: Type of holiday most recently booked via travel comparison websites/apps, April 2018
                                                                                                                                                              • A third of most recent holidays were packages
                                                                                                                                                                • At least 48% of holidays abroad are not ATOL protected
                                                                                                                                                                  • Accommodation-only bookings reserved for UK trips
                                                                                                                                                                    • Figure 45: Services booked via travel comparison websites/apps for the most recent holiday, April 2018
                                                                                                                                                                    • Figure 46: Services booked via travel comparison websites/apps for the most recent holiday, by type of holiday booked, April 2018
                                                                                                                                                                • Devices Used to Access Online Travel Aggregators

                                                                                                                                                                  • Laptops and desktops remain the preferred option for holiday bookings
                                                                                                                                                                    • Mobile becomes a viable option for booking
                                                                                                                                                                      • Figure 47: Devices used for research and booking holidays via travel comparison websites/apps, April 2018
                                                                                                                                                                  • Booking Behaviour on Online Travel Aggregators

                                                                                                                                                                    • Consumers compare their comparison sites
                                                                                                                                                                      • Figure 48: Repertoire of comparison websites/apps used to book holidays, April 2018
                                                                                                                                                                    • Consumers receptive to reward schemes
                                                                                                                                                                      • Loyalty schemes appeal more to higher economic groups
                                                                                                                                                                        • Figure 49: Consumer behaviour related to travel comparison sites/apps, April 2018
                                                                                                                                                                      • Protections available to holidaymakers
                                                                                                                                                                        • Chatbots may change the holiday booking process
                                                                                                                                                                        • Attitudes towards Online Travel Aggregators

                                                                                                                                                                          • An activity-first search appeals to over half of consumers
                                                                                                                                                                            • Travellers are engaged in the holiday planning process
                                                                                                                                                                                • Figure 50: Attitudes towards holiday planning and booking processes, April 2018
                                                                                                                                                                              • Consumers still perceive OTAs as better value than traditional travel agents
                                                                                                                                                                                • Figure 51: Attitudes towards the value of deals from comparison sites, by age, April 2018
                                                                                                                                                                              • Piecemeal booking styles seems here to stay
                                                                                                                                                                              • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                                                  • Abbreviations
                                                                                                                                                                                    • Consumer research methodology