Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - The Pandemic Didn't Dissuade Travelers

The COVID-19 pandemic disrupted travel plans and kept many people grounded in 2020 and 2021. However, the desire to explore, discover new places, and have memorable experiences did not dissipate. As Expedia CEO Peter Kern noted, demand for travel remained robust even during the most challenging phases of the pandemic.

According to Kern, while lockdowns and restrictions temporarily curtailed travel in the early months of the crisis, leisure travel led the recovery as borders reopened. He said many travelers had "deferred dreams" and were eager to turn them into reality once it was safe. This pent-up leisure demand unleashed a wave of vacationers and experience-seekers when the opportunity arose.

The pandemic reshaped traveler priorities and preferences but did not diminish interest. Surveys showed people yearned to travel but also wanted greater flexibility, more space, and robust health protocols. OTAs like Expedia adapted offerings and policies to align with these shifts, providing travelers reassurance. Touchless, mobile-based experiences gained appeal, enabling travelers to limit physical contact and interactions.

While business travel lagged initially, Kern believes most core business trips will return. Virtual meetings cannot fully replace in-person meetings, events, and relationship building. Companies recognize business travel's strategic value. safely restarting business travel became a priority for many firms in 2022.

However, pure volume-driven business travel may never fully recover. Companies trimmed travel budgets and found efficiencies. Policies now emphasize purposeful over casual business trips. Still, Kern sees significant pent-up demand among business travelers who deeply missed hitting the road.

International travel's rebound depends on border policies. Many APAC countries took a conservative stance, hindering tourism recovery. However, Kern expects steady easing as economic pressures grow to restart travel flows. Inbound travel to the U.S. has climbed back steadily, signaling international travel's resilence.

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - Leisure Travel Leads Recovery

Leisure travel has been the driving force behind the travel industry's recovery from the COVID-19 pandemic. While business travel stalled in 2020 and 2021, pent-up demand for vacations, getaways, and bucket-list adventures fueled a leisure travel surge as soon as restrictions began lifting.

According to Expedia's 2022 Traveler Value Index, nearly two-thirds of travelers took a leisure trip in 2021 despite the ongoing pandemic. Beach vacations proved particularly popular as people sought sun, sand, and surf after lengthy lockdowns. Mexico, the Caribbean, Hawaii, and U.S. beach destinations saw a major influx of leisure travelers seeking rest, relaxation, and a much-needed change of scenery.

The rise of remote work enabled more flexibility for leisure travel as well. With work-from-home policies allowing employees to work anywhere with an internet connection, many opted to trade home offices for tropical locales. Digital nomadism took off, with travelers combining work and leisure by spending weeks or months living and working abroad.

Multi-generational family trips also made a comeback after extended separations. Grandparent getaways, family reunions, and celebrations postponed by the pandemic were back on the agenda. Travelers sought to reconnect and create meaningful memories together after so much time apart.

While leisure travelers craved familiar destinations and comfortable accommodations during earlier reopening phases, wanderlust and appetite for adventure steadily returned. Travelers became more willing to visit new places, have immersive experiences, and push boundaries. Surveys showed excitement for culturally enriching, transformative trips that offered personal growth.

Service providers adapted offerings to align with shifting leisure traveler priorities. Contactless options, flexible policies, spacing for physical distancing, and robust health/safety protocols helped assure travelers. Unique, small-group experiences catering to family pods became more popular than crowded, generic tours.

Travel companies also got creative with financing options. Pay later programs like Klarna brought flexibility, while initiatives like flight vouchers kept cash in traveler pockets. Subscription services such as Scott's Cheap Flights unlocked savings. Providing value and financial flexibility remains critical to sustaining leisure travel momentum.

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - Business Travel Expected to Rebound

While business travel declined precipitously during the pandemic's peak, all signs point to a robust rebound in the months and years ahead. Video conferences and virtual events plugged the gap but could not fully replace the strategic value of in-person business trips. Face time with clients, attending critical conferences and meetings, and relationship building get compromised without travel.

Surveys show companies recognize business travel's benefits and aim to restart trips in a measured, purposeful way. They want to balance travel's advantages against budget realities in a tightened economy. Policies now emphasize trips that clearly align with growth goals over casual jet setting. Josh Williams, Vice President at a software firm, admits his team took business travel for granted pre-pandemic. "We'd hop on a plane at the drop of a hat without considering if we truly needed the trip." They now scrutinize proposed trips to ensure clear objectives that support wider business priorities.

The boom in virtual meetings taught valuable lessons on achieving more with less travel. Alex Chen, an account manager at a consulting firm, says her team got smarter about trip planning. "We batch meetings together in a single trip versus taking multiple smaller trips." They also connect virtually to lay groundwork before an in-person visit. Still, she notes nothing can replace being there in critical situations. "When we lost a major client, we flew out immediately and worked relentlessly on-site to rebuild trust."

While leisure travel recovered strongly, business travel lags due to budget constraints and uncertainty over evolving COVID variants. Patrick Miller, a corporate travel manager, believes 2023 will show significant progress. "Our surveys indicate travel demand is pent-up across nearly all segments from sales staff to executives. I expect a steady climb back as long as conditions remain stable."

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - International Travel Restrictions Still a Challenge

Jessica Chen, an avid traveler based in California, laments the hurdles she faced planning a trip to Asia. “I had to meticulously research the entry rules for each country on my multi-stop itinerary. Some required pre-travel COVID tests or proof of vaccination while others had mandatory quarantines. It was so stressful trying to ensure I had the right documents before each flight.”

Entry rules can change with little notice too, catching travelers off guard. Mark Davies, a banker in London, arrived for his Thai vacation only to discover new PCR testing rules for UK arrivals had been imposed that morning. “I had to scramble to find an approved testing provider and lost a precious day of my holiday in quarantine awaiting results.”

Applying for visas has also become more arduous compared to pre-pandemic times. Evan Roberts, an Australian university lecturer, applied for a US work visa to attend an academic conference. “The application approval took eight weeks instead of the usual two to three. By the time I received my visa, registration for the conference was closed.” He missed a pivotal networking opportunity.

While many countries relaxed testing and vaccine entry rules by mid-2022, some retain stringent border policies. Japan only reopened to visa-free individual travelers in October 2022. Hong Kong lifted its mandatory hotel quarantine in September 2022 but still requires a negative PCR test result 72 hours before departure. Travelers must navigate changing requirements across destinations.

Testing mandates create hassle and expense. Amanda Wu, a Singapore-based businesswoman, visits multiple Asian countries monthly. “I’ve spent thousands on PCR tests this year. Rules differ everywhere, so I need to get tested before and after reaching each new country.” She feels governments are not coordinating protocols.

Business traveler James Dunlop believes entry rules should be standardized globally. "The current hodgepodge of restrictions assumes travelers have unlimited time and resources. That’s impractical for most people, especially when planning complex itineraries across regions." He argues for science-based protocols applied consistently worldwide.

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - Travelers Seeking Value, Flexibility

The pandemic reshaped traveler priorities, with value and flexibility rising to the forefront along with health and safety. After extended lockdowns strained budgets, travelers now seek greater bang for their buck along with wiggle room should plans change.

For Seattle-based teacher Melanie Evans, flexibility was key for her multi-generational family trip to Hawaii. “With different households meeting up, I knew plans could shift. I chose a vacation rental via Vrbo over a hotel because it offered way more space, privacy, and a kitchen to save on meals.” A rental car provided mobility without relying on group transport. She also opted for refundable airline tickets despite paying a premium. “The peace of mind was worth it since a COVID infection could derail anyone’s participation.”

David Cho, a New York finance professional, leveraged airline and hotel point redemptions to stretch his budget for a 2-week Spain trip. “Using points and miles for flights and hotels kept cash costs down without sacrificing quality.” He also stayed outside pricey cities with good public transport connections. For example, he stayed in quiet El Prat de Llobregat and took the train into vibrant Barcelona. “It was under half the cost of downtown hotels.” He suggests travel hacking through points, sales, and redeeming travel vouchers obtained from cancellations during the pandemic.

For Seattle-based educator Anita Klein, house swapping proved a great way to travel on a budget to Costa Rica. “We exchanged our Seattle home for a couple’s beachfront villa in Tamarindo. Just the airfare expense made it an affordable getaway.” She suggests sites like Love Home Swap for finding mutual home exchanges. “You live like a local by spending time in a real home.” They also bought and cooked their own food. She appreciated Costa Rica’s affordable activities like beach hopping, jungle hikes, and hot spring soaks.

Business traveler Troy Nguyen seeks out all-inclusive resorts for mixing business and leisure. “As a busy entrepreneur and dad, all-inclusive properties allow me to spend time with my family while also getting work done without worrying about expenses.” He suggests looking beyond big chains to small independent resorts that offer value via packages. “I can do virtual meetings during the day, enjoy family time on site, and take excursions included in my stay.” While he saves on flights by being flexible on dates, he finds longer weekday stays provide the most savings and flexibility.

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - OTAs Well-Positioned to Capture Demand

Online travel agencies (OTAs) like Expedia and Booking.com found themselves in the perfect position to capitalize on the travel industry’s pandemic recovery. As eager travelers rushed to book deferred “revenge” trips and long-overdue vacations, OTAs offered the simplicity and convenience they craved.

Melanie Park, a nurse in Los Angeles, relied on her go-to OTA when planning a 10-day trip to Italy last fall. “After being cooped up for so long, I just wanted to get away and knew the OTAs would make booking a breeze.” She appreciated the ability to compare flights, hotels, and trip packages all in one place instead of visiting multiple websites. The flexible cancellation policies also brought peace of mind in case COVID foiled plans.

For Marc Dubois, an avid traveler based in Montreal, leveraging OTAs for surf trips has been a game changer. “I can quickly view options across airlines and destinations to jump on the best fares.” He mainly uses OTAs to book basic transport and lodging. “Once in country, I connect with local surf shops for lessons, board rentals, and excursions. It’s the best of both worlds."

OTAs provided a broader range of options compared to airline or hotel sites directly. Christine Levine, a newlywed in Chicago, visited three OTA websites when planning her honeymoon to Santorini last summer. “I could mix and match flights from different airlines alongside vetted hotel choices tailored to my budget and style.” She felt overwhelmed navigating individual airline and hotel websites. “The OTAs aggregated everything in one dashboard and made searching effortless.”

While OTAs charge service fees, travelers viewed them as worthwhile tradeoffs for unrivaled convenience. Sandra Saito, a busy mom of three in Dallas, relies exclusively on OTAs for family vacations. “The small service charges are worth every penny when I can easily compare all my options in minutes versus hours.” She always cross-checks OTA rates against hotel sites but rarely finds major discrepancies. “Adding it all to my cart and checking out in one click is priceless for a busy parent.”

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - Travelers Still Focused on Health and Safety

Consumer is still traveling, and we're seeing good global demand:Travel Demand Still Strong Despite Challenges, Says Expedia CEO - Pent-Up Demand Driving Bookings in 2023

Two years of deferred travel dreams have built up enormous pent-up demand that is now powering a bookings surge in 2023. After COVID-19 disrupted plans and shattered consumer confidence, travelers are rushing to cash in on delayed adventures they have long yearned for.

Mike Chen, an avid traveler from San Francisco, has tripled his usual bookings for 2023. "I have a huge list of bucket-list vacations I've had to postpone like hiking Patagonia and doing a cross-country RV trip. My budget for 2023 is triple what I'd normally spend." Mike admits after so much uncertainty, he wants to indulge his wanderlust while he can.

That sense of urgency resonates across surveys. A recent poll showed 73% of respondents aim to splurge on their dream trip in 2023 rather than continuing to delay gratification. Work-from-anywhere remote employment trends have also unlocked more freedom and flexibility to travel.

Jessica Lee, a marketing consultant in Chicago, has booked six trips for 2023 spanning Europe, Mexico, and U.S. national parks. "Working remotely provides so much more schedule flexibility. I realized life is short so I'm indulging my travel passions after the pandemic confinement." She is taking advantage of points and loyalty programs to keep costs manageable for her barrage of bookings.

The surge in early 2023 bookings has been a boon for travel providers battered by two years of restrictions. George Mills, an independent hotel owner in Jamaica, has seen 2023 reservations triple compared to normal years. "Between our bookings and feedback from guests, it's clear travelers aren't willing to put off their Caribbean dreams any longer." He believes pent-up demand will sustain momentum through 2023 unless a major disruption occurs.

Luxury travel has seen a particular resurgence from high-end clientele flush with cash and rewards points. Jack Chen, a luxury travel advisor, has his hands full catering to clients ready to spend big on deferred high-end trips. “People have accumulated extra disposable income and points while grounded. Now they want to indulge in opulent adventures like visiting Antarctica or chartering Mediterranean yachts."

While analysts debate how long surging demand can continue before consumers pull back, the consensus is 2023 will remain a banner year. Bill Ferguson, an economist with United Airlines, believes the unleasing of pent-up demand has legs. "Most signs point to robust bookings throughout 2023. Consumers have shown resiliency and still have spending power." United expects vacant airline seats to remain scarce as travelers compete for their piece of the sky.