Ready or not, here they come.
Beginning next year, millennials, the millions of 17 to 34-year-olds who comprise history’s largest ever consumer generation, are poised to spend $200 million annually, and upwards of $10 trillion in their lifetime.
This anticipated future millennial spending presents a tremendous opportunity for the travel industry in particular. According to new research, the millennial generation is expected to spend more on travel services incrementally in the next year than any other age group, and will be the driving force behind the U.S. travel industry’s continued recovery. Thus, travel brands are well positioned to capture millions of new bookings each year, and grow market share, but only when marketing efforts to reach the millennial audience are effectively executed.
Industry-wide, the key to winning in the millennial marketplace is to get a comprehensive understanding of this massive consumer generation’s relationship with travel. Where, why, and how often are they traveling, and what exactly are they spending their travel budget on?
We can start by defining the millennial consumer, and their general attitudes about travel. Recent findings in MMGY’s 25th annual study, Portrait of American Travelers®, discovered that millennials are more focused on acquiring experiences than material goods. When it comes to travel, 69% of millennials surveyed said they are more likely to try new things while on vacation. What’s more, travel is increasingly important to most millennials. Specifically, the study found that 57% of millennials said that taking a vacation is the event they most look forward to each year.
This provides travel brands a great opportunity to capitalize on millennials’ adventure-seeking mentality by creating relevant, targeted messaging and creative campaigns that highlight unique offerings and ability to deliver experiences.
For example, our team worked with Bermuda tourism to help shift the perception of the island and target a younger demographic. We created an engaging interactive video, where people could choose which path they wanted to take, either “Chill”, “Fun”, or “Thrill”, with Bermuda as their destination. The end result is a personalized bookable itinerary based on the consumers preferences to build their own unique experience which they can share with their friends or save as a future travel planning tool.
In addition to understanding how millennials think about travel, we, as travel industry marketers, also need an accurate and comprehensive picture of the the millennial traveler. Although most marketers tend to think of millennial travel as being driven by single backpackers with a small budget and a carefree attitude, MMGY found that, in fact, the opposite is the case.
While 27% of millennial couples plan on taking more vacations in the next year, 43% of millennial families stated their desire to increase their vacation plans over the next 12 months. Moreover, millennial families plan to spend nearly twice as much as millennial couples on vacations in the next year, with the former budgeting $6,113 for the next 12 months, and the latter expecting to spend $3,534 in the same time period.
For travel marketers, millennial couples and families offer a big opportunity to tap into two affluent sub segments of the generation, which don’t at all resemble the backpacking-on-a-budget millennial traveler they typically think of when initially considering how to reach this consumer group.
The research also suggests millennials are taking vacations close to home more often, in an effort to save up for a bigger trip down the line. One-third of millennials surveyed took at least one vacation within 50 miles of their home, with the idea to do so fueled by their desire to save money for a more substantial trip in the next year.
In terms of travel planning, nearly one quarter of millennials—who took 4.6 overnight trips last year, compared with 4.2 for all U.S. households with an annual income of over $50,000—said they planned to take more overnight trips for leisure purposes in the year ahead.
There’s no question that millennials are changing the travel landscape worldwide. As the millennial travel engine continues full speed ahead, it’s important for travel marketers to understand the behaviors and unique attributes of this travel segment and ensure they develop the right strategy to reach, engage and convert their desirable segment.
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