Transcript Document

Air Travel: Trends, Insights
and Opportunities
Gabe Ingalls
May 2011
Summary – Budget and Long-Haul
In the last two years 23% have been on a budget holiday overseas. Of this, independently
booked trips were twice as likely to have been taken as packages.
Across all adults, the most popular attitude towards budget holidays is negative – almost one in
three people say they prefer to save up and take more expensive holidays. Amongst people
who’ve been on budget holidays, more than four in ten people say they’ve had great holidays
for a budget amount.
Again amongst this latter group, almost one in four say budget holidays are all they can afford,
while one in five go on budget holidays because they prioritise other spending. Consumers who
say they can only afford budget holidays are most likely young, particularly 15-24-year-olds.
Mintel’s research shows that nearly a fifth of those who have taken a long-haul package over
the past year say they are now less likely to take long-haul holidays as a result of the recent APD
rises. Nonetheless, both long and short haul flights are up year on year on Bing.
Long-haul holidaymakers are most likely to be ABC1 pre-/no family couples/singles or ABC1
third age couples, particularly in the 55-64 age group.
The strongest attraction of long-haul holidays is seen as the opportunity for enjoying fresh
cultural experiences,
© 2010 Mintel International Group. All rights reserved. Confidential to Mintel.
Summary: Flight Priorities and Consumer Trends
Prompt departure/arrival times are a key issue for consumers – one in three rank this as the
most important ‘not in flight’ factor of a good air experience.
Second-ranked here is the desire for a decent hand luggage size/weight allowance, with this
option far more likely (at a ratio of two to one) to be chosen by women.
Approximately one in six look first for some form of onboard entertainment – this is particularly
important to fliers with children and those on long-haul journeys.
The cost of food/drink onboard (ie when it is not included in the ticket price) is a concern for
many – almost eight in ten fliers believe that when food/drink can be purchased onboard it is
too expensive.
Two in five think that airlines could do more to make check-in faster. And the older fliers are,
the more likely they are to agree – three in four of those aged 55-plus do so, for example.
At the other end of the age range, younger fliers are the most likely to agree that price is the
most important thing in choosing an airline. In fact, the younger the traveller, the more likely
they are to agree.
© 2010 Mintel International Group. All rights reserved. Confidential to Mintel.
Market Environment – Budget and Long Haul
Research
Issues in the Market: Budget
•With an average expenditure of £212 in 2010, domestic holidays are the key competition for
budget overseas holidays. While all overseas trips and budget breaks dropped in 2009, UK
holidays taken by UK residents rose almost 17% that year – with much media attention devoted
to this so-called ‘staycation’ trend.
•Fuel supplements are back for many flights. Both of the market-leading tour operators – TUI
and Thomas Cook – have re-introduced surcharges, adding £15 per person on short-haul trips.
The instability in major oil-producing regions across the globe suggests that prices are unlikely
to fall in the near future.
•In addition, petrol prices have reached a record high in the UK, and have also surged in
popular European destinations for budget holidays – increasing the overall expense of self-drive
holidays, a major budget trip segment. This does, however, also have implications for domestic
holidays (the competition) with three in four UK holidays taken by car.
•Budget holidays abroad are more likely to be independent trips (where components are
bought separately) than packages, as Mintel’s exclusive consumer research reveals. The leading
low-cost airlines easyJet and Ryanair have continued to grow throughout the recession, and in
the period 2006-2010 increased passenger numbers by 50% and 80% respectively.
© 2010 Mintel International Group. All rights reserved. Confidential to Mintel.
Research
Issues in the Market: Long Haul
•Long-haul holidays have fallen 15% in volume and value terms over the past two years, to
reach 7.24 million trips and a value of £6.9 billion (excl. transport) in 2010.
•Some 46% of UK adults have now been on holiday outside Europe at some point in their lives.
Almost a fifth of consumers have travelled beyond Europe on holiday during the past 12
months.
•However, Mintel’s research shows that nearly a fifth of those who have taken a long-haul
package over the past year say they are now less likely to take long-haul holidays as a result of
the recent APD rises.
•Long-haul holidaymakers are most likely to be ABC1 pre-/no family couples/singles or ABC1
third age couples, particularly in the 55-64 age group.
•The strongest attraction of long-haul holidays is seen as the opportunity for enjoying fresh
cultural experiences, selected by a third of consumers overall, and over half of recent long-haul
travellers.
•Just one in eight consumers say they would want expert advice from a travel agent before
booking a long-haul holiday, a fall of seven percentage points since November 2006.
© 2010 Mintel International Group. All rights reserved. Confidential to Mintel.
Consumer Trends
Search
Air Travel Hitwise Demographics
•
•
•
The South-East, London and some of the
North-West have the highest % of Searchers
There is an even gender split in the
consumers in the is category
The 55+population make up a large
percentage of the searchers in the category
Source: Hitwise
Source: Hitwise
Source: Hitwise
Search
Air Travel Hitwise Demographic Mosaic and Social Grades
• Air travel has the highest number of visitors in the A/B/C1
categories however indexes the best in the A/B category
• Suburban Mindsets, Liberal Opinions and Professional
Rewards make up the top 3 mosaic groups while the Alpha
Territory’s and Active Retirements over index
Source: Hitwise
Source: Hitwise
Advertising Climate
Media Spend
Travel advertisers tend to spend the
most on Press advertising and
Television followed by the Direct Mail
On average the industry spent around
8% on Internet advertising (not
including search)
Source: NNR adDynanix : 2009 - 2010
Impressions and Audience by Publisher - AdMetrix
•
•
•
While the top number of impressions goes to Yahoo! only beating out
Microsoft sites slightly, MS Sites have a larger number of Advertising
Exposed Unique Visitors than any other publisher
MS sites have the 3rd highest frequency behind that of Yahoo! Sites and
AOL
MS Sites have the highest GRP of the Total Population
MS offers a unique opportunity to Air Travel Advertisers to make the most
of their campaign by offering the largest reach of all publishers
Source: ComScore AdMetrix: March 2011
Top Advertisers by Impression AdMetrix
Source: ComScore AdMetrix: March 2011
The top 5 Advertisers make up 74% of the
vertical’s impressions
Search
Bing Search Traffic KPIs
•
Overall, flights/air travel KWs have grown 38% year on year for 2011
•
While this took a dip in April, mostly in the 2nd half of the month as a result of Easter,
the Royal Wedding and Bank Holidays, the market has grown 13% for April year on
year
•
Long-haul flights have been popular in the 1st quarter due to the increase in public
holidays in April
1.
Microsoft Advertising Intelligence Tool
Search
Product and Location KW Traffic - Bing
•
Year on year for 2011, Bing has seen
strong growth in traffic to East Asia as
well as Australia/New Zealand
•
However, overall, short-haul flights
have grown more in 2011 (45%) than
long-haul (36%)
1. Microsoft Advertising Intelligence Tool ( Year on year and month on month for April)
Search
KW Traffic vs Exchange Rates
Expenditure once you reach a destination can also be a deciding factor when
choosing a destination. Consequently, keyword traffic to destinations can be
influenced by the exchange rates to those destinations as shown below.
Current Exchange
Rates
Australia – 1.5
United States – 1.6
Europe – 1.1
Search
Air Travel - Hitwise Category
•
Capital One KWs are typically a combination 1 to 3 search terms
•
While organic clicks provide most of the traffic, paid search has grown in the
past couple of months to account for almost the same % of clicks
Source: Hitwise
Source: Hitwise
Search
Air Travel KW Demographics and Daily Trends: Bing
•
54% more during the week than weekend
•
There is a slight bias towards female searchers; traffic peak in the 35-49 age brackets
1. Microsoft Advertising Intelligence Tool
Search
Air Travel Hitwise Demographics
•
•
•
The South-East, London and some of the
North-West have the highest % of Searchers
There is an even gender split in the
consumers in the is category
The 55+population make up a large
percentage of the searchers in the category
Source: Hitwise
Source: Hitwise
Source: Hitwise
Search
Air Travel Hitwise Demographic Mosaic and Social Grades
• Air travel has the highest number of visitors in the A/B/C1
categories however indexes the best in the A/B category
• Suburban Mindsets, Liberal Opinions and Professional
Rewards make up the top 3 mosaic groups while the Alpha
Territory’s and Active Retirements over index
Source: Hitwise
Source: Hitwise
Microsoft Media Network Trends
Microsoft Media Network
Network Demographics
54% of the impressions occur between 18 and 34, while a larger proportion of
clicks occur in the higher age brackets, 25-54, than in impressions
Impressions and conversions peak in the 18-24 for females while the higher
age groups are more evenly split
55% of conversion occur between the 18-34 age bracket
Conversions for Travel usually entail a booking
Conversions are
predominantly females,
particularly in the lower age
groups even though clicks
are more evenly distributed
throughout the
demographic range
Source: Microsoft Media Network : July 2010 – April 2011
Microsoft Media Network
Network: Day of the Week
There is a slight decline in impressions through out the week however consumers
are more likely to click during first half of the work week and on Sunday
Conversions have two peaks on Tuesday as well as at the end of the week on
Friday
Source: Microsoft Media Network : July 2010 – April 2011
Microsoft Media Network
Network: Time of Day
There is a build of Impressions and Actions during the early afternoon and a slight
elevation in the early evening
There are two main peaks that occurs post-lunch before the end of the work day and at the
end of the evening
Targeting options could
include the during and
post-lunch targeting to
hit the break browsers
Activity ramps up quickly
during the start of the
work day and maintains
levels until evening
Source: Microsoft Media Network : July 2010 – April2011
Consumers are most active
during the evening
Air Travel Opportunities
Emerging Destinations
Because of many variables in the market place, there are many factors which influence destination choice. Exchange
rates, fuel prices and cost of living are all factors. On Bing, East Asian countries have seen strong growth so far in
2011. Moreover, budget airlines to sunny European destinations should also continue to grow
Demographic/Mosaic
The users and searchers for this type of product index well in demographic sectors and can be targeting with our
Mosaic offering
Search and Display – Better Together
Use both offerings to help boost your ROI moreover, use our display offering to help boost your brand campaign.
Particularly when we have seen good increases in traffic in the start of 2011
Emerging
Destinations and
Micro Trends
Independent
Budget Flights to
Traditional
European
Destinations
Search and
Display Better
Together