Skift Take
At the Skift Global Forum in New York, we polled travel industry decision-makers to determine how they approach the rise of experiences, how they think about shifting traveler behaviors, and how technology impacts modern booking processes.
Key Points
- Travel experiences have become a crucial part of the booking process, with spending increasing by one-third since 2019.
- Social media is more effective in inspiring travelers rather than driving bookings, with 57% of Gen Z and millennials using it for planning.
- Generative AI is seen as a key tool for inspiration and aggregating reviews, with potential for growth in personalized customer experiences.
Summary
The article discusses the growing significance of travel experiences in the industry, highlighting that spending on experiences has outpaced consumer goods since 2019. It explores the influence of social media as a source of inspiration for travelers, particularly among younger generations, and the emerging role of generative AI in inspiring and informing booking decisions. The piece also underscores the importance of sports tourism and the potential for destinations to capitalize on these events through proactive strategies.
This sponsored content was created in collaboration with a Skift partner.
Experiences and activities are a surging sector in the travel industry. At the Skift Global Forum in September, Skift Head of Research Seth Borko hosted Ruzwana Bashir, founder and CEO of Peek, Nishank Gopalkrishnan, chief commercial officer of TUI Musement, and Jules Seeley, senior partner at McKinsey & Company, in a discussion about the growing importance of travel experiences.
During talks like this one, we surveyed our audience of over 1,500 travel industry executives to determine what they think about the rise of experiences in travel and the shifts in travel behavior in recent years. The poll results show how exciting experiences like mega-sporting events are now the origin of many traveler itineraries. They also paint a clear picture of how travelers get inspired by available experiences, from the role of social media to the impact of generative AI.
Experiences Anchor The Modern Travel Booking Process
Whether or not they are the origin of trip planning, travel experiences are clearly worthy of attention. Spending on travel experiences has increased by one-third since 2019, outpacing growth in the consumer goods space by 8 percentage points. And according to a research report by Skift and McKinsey, the travel experience market represents a $1 trillion opportunity globally.
The overwhelming majority of executives (63 percent) believe that travelers consider the experiences they want to have first and then book their travel around those plans. Thirty-six percent say that while experiences are one factor in travelers’ decision-making, other factors are more dominant. Only 2 percent of respondents believe traveler decisions are not influenced by experiences.
A Proactive Approach Will Help Destinations Benefit From Sports Tourism
One specific type of travel experience gaining global attention is sports tourism. According to Grand View Research, the global sports tourism market was valued at $683 billion in 2023 and is expected to reach $2.1 trillion by 2030. The UNWTO says sports travel already accounts for 10 percent of global tourism expenditure.
Sixty-three percent of executives said sports tourism drives inbound spend and destination interest after the event. Thirty-eight percent say that while there is a chance the investment pays off, realizing that potential depends on the specifics.
Destinations must carefully consider how to extend the momentum generated by a sports tourism campaign beyond the live event. Proactive plans to maximize interest will help ensure that destinations — and their local economies — reap the rewards long after the event is over.
Social Media Inspires More Effectively Than It Drives Bookings
Social media’s role in driving bookings may be overhyped compared to its effectiveness in driving inspiration. According to Skift Research, 57 percent of Gen Z and millennial travelers rely on social media for travel planning, with a particular emphasis on the inspiration phase.
Only 14 percent of travel executives said they book the bulk of their itineraries based on social media recommendations. Seven percent don’t do any advance research, opting instead to book experiences once they’ve arrived at their destination.
The overwhelming majority of respondents (79 percent) say that while social media posts are interesting, they prefer recommendations from other sources when making their booking decisions.
Generative AI Inspires and Informs Travelers’ Booking Decisions
Generative AI is another powerful source of traveler inspiration. Thirty-six percent of travel executives believe inspiration and ideation are generative AI’s primary use cases today.
Another 36 percent of respondents believe generative AI is most helpful in aggregating reviews from various sources. A smaller contingent (29 percent) believe generative AI is most useful to travelers when leveraged as a customer service chatbot.
This indicates there’s still room to grow in this use case, especially as genAI’s ability to provide humanized and personalized customer experiences improves over time.
This content was created collaboratively by Travel Guard and Skift’s branded content studio, SkiftX.
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Tags: experiences, generative ai, SkiftX Creative Studio, SkiftX Showcase: Technology, social media, sports tourism