Overseas holidays to bounce back by 2011, says Key Note study

Market research body Key Note is predicting a post-recession bounce back for sales of overseas holidays and a fall in domestic holiday bookings by 2010 or 2011.

Its Market Assessment 2009 report, Holiday Purchasing Patterns, predicts long-term trends of increasing overseas holiday sales and declining domestic holidays will quickly be restored after the recession. It also concludes that there will be an overall fall in the number of trips taken, but a rise in value.

For this year, however, Key Note predicts an increase in the overall number of holidays taken, from 120 million trips in 2008, to 121 million in 2009, because of more affordable breaks, particularly in the UK. These figures refer to all trips being taken by UK holidaymakers.

Its figures show 43 million overseas holidays, valued at £24.5 billion, will be booked this year – a decline of 4.4% in volume terms on last year – and 78 million domestic trips, valued at £15 billion.

The report added: “[Domestic holidays] will be a substitute [for overseas] holidays. However, the long-term trend in the market will be quickly restored, meaning the upward trend for holidays abroad will be resumed in 2010 or 2011, where there could be a strong ‘bounce-back’ from 2009, as consumers realise they regretted not going abroad for a long holiday the previous year.”

From 2010, it forecasts a steady annual increase in overseas trips, to 46 million by 2013 – a growth of 7%. At the same time it predicts a gradual decline in domestic trips, to 72 million by 2013 – a decline of 7.7%. Likewise, spend on overseas trips will go up, to £28.5 billion by 2013 (a 16.3% rise), and the value of domestic trips will fall to £14 billion (a 6.7% fall).

Overall, by 2013, the number of holidays taken will fall by 2.5% from 121 million in 2009, to 118 million in 2013, according to Key Note, while the overall value of all trips taken will increase by 7.6% from £39.5 billion, to £42.5 billion.

The report said less capacity – already about 25% of overall industry capacity has been taken out in 2007/08 by the major operators – combined with a more sophisticated market, will drive consumers to take more expensive overseas holidays.

The future of high quality package holidays remained secure, it said, despite a rejection by many holidaymakers of the traditional package holiday because of a mass market image of ‘crowded beaches and shoddy, noisy resorts with tower-block accommodation’.

It added: “The future of high quality ‘packaged’ holidays is assured, as evidenced by the buoyant demand for long-haul, all-inclusive resorts and cruise holidays.”


More from the Key Note report


UK holiday market forecast by volume and value, 2009-2013

Volume (million trips)
Holidays abroad 43.043.544.545.346.0
Domestic holidays78.
Value (£ billion)
Holidays abroad*24.525.426.327.428.5
Domestic holidays15.015.014.914.614.0
Total 39.540.441.242.042.5

*Excludes transport to and from the UK.

Note: This table illustrates the growth in the UK holiday market in volume terms between 2004 and 2013. The table shows the decline in volume terms predicted for the domestic holiday market and the total market, but the slight rise forecast for overseas holidays.

Source: Key Note/NEMS Market research, February 2009

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