Research Insights U.S. travel's third-largest segment by size: Experiences

U.S. travel's third-largest segment by size: Experiences

March 2019
Phocuswright Research

U.S. travel's third-largest segment by size: Experiences

Travel is an experience. It's about dreams and relationships. Daring, exploring, learning. Doing and not doing. Indulging and relaxing. Connecting, reconnecting. Travel is about being there. Active travelers, those who participate in travel activities, are a passionate subset who place high importance on travel. Travel is a key part of their life, and they take more trips and spend more on travel annually than the average leisure traveler. According to Phocuswright's newly published travel research report, Experiences 2019: U.S. Market Opportunity and Consumer Behavior, travel activities account for 8% of U.S. travel gross bookings and the segment comes in third by size behind hotels and flights. The U.S. travel activities market totaled $34 billion in 2018, and growth is outpacing the total travel market.

Phocuswright Chart: U.S. Total Travel Activities Market
(Click image to view a larger version.)

Flights and accommodation can be a notable part of the travel experience if a traveler is in a front-of-plane seat or staying in a unique accommodation, but mostly these products serve as logistics. It's the things travelers do when they get there that inspire them to go places. Seven in 10 travelers consider activity options as an important factor when deciding on their destination, and more than one third start researching activities before they book any other trip elements.

The industry has had to adapt business to realign to traveler behaviors, including what consumers hope to experience and how they behave throughout the activity decision-making process. Activity providers have gotten serious about digitizing business, making their inventory discoverable and bookable online – where most travelers prefer to research and purchase travel. The adoption of third-party reservation technology systems has contributed greatly to progress, providing a more efficient solution to manage business.

Even though reservation technology adoption has been on the upswing, connectivity into online resellers, that is, connectivity into the platforms that aggregate activities for consumers to search and buy, is still largely manual. Moreover, many smaller business owners feel their enterprises are not of sufficient size to require technology to assist in their distribution. However, online activity resellers and reservation technology companies have spearheaded industry efforts to educate providers and champion the importance of digitization. More activity providers are getting the message and becoming connected and savvy. More ways than ever before enable travelers to discover and book things to do and fulfill their experiential aspirations.

Phocuswright's Experiences 2019: U.S. Market Opportunity and Consumer Behavior tracks the U.S. travel activities sector, examining how U.S. consumers view and engage with activities, and charts the activity provider and seller marketplace. Purchase this report to gain insights into:

  • Who the active traveler is – how they profile themselves, what motivates them to travel and choose particular activities
  • The traveler activity lifecycle – where, how and when travelers research and book activities and why
  • The size and composition of the U.S. travel activities marketplace and forecasts through 2022
  • The state of U.S. activity supply – online distribution, technology adoption and marketing tactics
  • The outlook for online intermediaries and suppliers' attitudes toward online distribution

Phocuswright's Experiences 2019: U.S. Market Opportunity and Consumer Behavior is immediately available to Phocuswright Open Access subscribers – learn how to unlock it for your entire company here.

Dig into Europe's travel activities scene

Explore how the explosive experiences segment is disrupting the traditional European tour operator market and creating new challenges in destination marketing at Phocuswright Europe. Phocuswright shares its latest research on the segment to kick things off, followed by a lively roundtable discussion with market players.