UK consumers are set to spend £40.9 billion this year on package holidays both at home and abroad, according to new research.
This is 94% of pre-pandemic levels in 2019 when Britons spent a total of £43.5 billion on packages, an analysis of data from the Office for National Statistics by payment technology provider BR-DGE calculated.
UK online searches for package holiday deals increased by 31% month-on-month in June, showing travel demand growing ahead of the busy summer trading period.
June 9 was the most popular day for package holiday searches during the month as UK temperatures hit 30C and the UK Health Security Agency issued an extreme weather warning.
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A survey of more than 1,200 consumers, conducted on behalf of BR-DGE between December and January, highlights how this trend is set to continue with two-thirds (65%) of UK holiday goers reporting that they spend over £1,000 a year on holidays.
More than a fifth (21%) of those who purchase travel use their credit and debit cards for transactions.
However, more consumers are turning to alternative payment options to fund getaways and travel amid the cost of living crisis.
One in 10 of UK holidaymakers are paying for their travel and holidays with buy now, pay later or instalment options, rising to nearly 18% among millennials.
Almost half (42%) of respondents said that they would be open to using alternative payment methods such as buy now, pay later in order to buy holidays in the future.
BR-DGE travel specialist Emily Whalley said: “The UK travel industry is reaching a tipping point as travel demand is soon set to bounce back to pre-pandemic levels.
“Travel firms are seeing positive momentum as consumer demand for hassle-free holidays remains robust, despite disposable incomes being hit by the increased cost-of-living.
“We continue to see holiday goers looking for value and flexibility, seeking out discounts and deals for quick getaways and greater personalisation at the checkout via new payment methods.
“This data further shows the value of creating bespoke payment workflows and checkout experiences that align with different consumer habits so that holiday goers are supported throughout the customer journey.
“For travel providers, this highlights the importance of delivering an end-to-end frictionless customer experience in order to drive loyalty, protect margins, and deliver a first-class holiday for all.”
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