United Kingdom

Travel Profile (total)

  Yr/Yr % Chg
Visitor Spending (2016p) $1.03 billion -
California Market Share (2015) 16.3% -
Visitors to California (2016p) 693,000 -
2017 Visitation Forecast (% change vs. 2016p) 688,000 -0.7%
2021 Visitation Forecast (% change vs. 2016p) 729,000 +5.2%
2021 Spending Forecast $1.1 billion -

(updated May 2017)
Sources:
U.S. Department of Commerce; Tourism Economics 

Leisure Travel Profile (82% of total)  

Index
Vacation/Holiday 85% 126
Hotel/Motel 79% 108
Average Length of Stay - Nights 10.4 82
Average Spend Per Trip $1,361 68
Average Destinations Visited Per Trip 3.6 116
Average Party Size 1.8 105
Travel with Children 12.3% 91

Sources: U.S. Department of Commerce; CIC Research, Inc.

 


 

Market Conditions

   
United Kingdom GDP Quarterly Growth Rate
 
British Pound

While commentators predicted another recession in the aftermath of a pro-Brexit vote, the reality in the United Kingdom has been somewhat muted

The luxury sector continues to outperform the mainstream and value end of the market

 

Check current exchange rates on www.xe.com.

  • The pound has weakened against the dollar and driven the price of holidays to the United States up by around 15 percent in some cases, but customers continue to book holidays, reaffirming that the British holidaymaker is more resilient than some of their continental counterparts
  • In general, Visit California’s United Kingdom trade partners are approaching 2017 with cautious optimism, and watching forward bookings that may have slowed a little since the Brexit vote; target segments for California are considered less sensitive to currency fluctuations than those considering a holiday to destinations such as Florida
Source: Numbers and anecdotal feedback provided by Trade Partners including Abercrombie & Kent and Elegant Resorts

 


 

Competitive Landscape

 

 

Top 2015 Spenders

  • Qantas recently announced that they are to commence flying direct from London to Perth on a Dreamliner from March 2018
  • Norwegian Airlines launched their London Gatwick to Las Vegas route in October 2016, and will have shaken up the Virgin Atlantic/British Airways duopoly with promises of seats one way from as little as £179
  • Las Vegas has always invested in brand campaigns and generally refused to work with any trade partners except Virgin Holidays or British Airways; predictably, their recent tongue-in-cheek “”Where even your accent is an aphrodisiac”” campaign was purely brand-focused with no call to action
  • August saw bombings and October saw the death of King Bhumibol Adulyadej in Thailand, causing many United Kingdom travelers to reconsider their plans
  • Florida, Mexico and South Africa continue to invest heavily in the U.K. market despite local challenges such as the Zika virus and political unrest
 

California: $2.7M
Australia: $2.52M
Las Vegas: $1.46K
Dubai: $1.43K
South Africa: $934K

    Source: Nielsen

 


 

 Market Barriers

 

Risk Factors

  • The weakening pound has had some impact on U.S. travel (and other destinations), but not at an alarming level
  • Should the exchange rate dip below $1.20, then there may be a perceived lack of value in holidays to the United States
  • There has been debate over the impact of President Trump’s administration and what it could mean for international travelers visiting the United States
  • Despite more airlift and direct routes than ever, travel times from the United Kingdom will continue to deter some segments
  • In addition, the lack of all-inclusive product can be a deterent, a product which is widely available in some competing destinations
  Britain’s on-off relationship with the European Union has raised the risk of a deterioration of the U.K.’s relationships with many of the leading countries in Europe, but Britain enjoys lower economic risk levels than most other large economies due to the flexibility and diversity of the U.K. economy.

 


 

Airlift

 

Booking

  • 115 weekly nonstop flights
  • 36,438 weekly nonstop seats
  • Existing carriers are increasing size of planes and frequency; new routes launching in 2016 include London Heathrow–SJC (British Airlines), Manchester–LAX (Thomas Cook Airlines) and London Gatwick–OAK (Norwegian)
  • New low-cost carriers are entering the market, including Wow Air (via Reykjavik)
 
  • Planning timeframe: up to 5 months
  • Booking timeframe: evenly spread from 30 days to 6 months
  • Approximately 32 percent of visitors book with traditional operators, with the remainder booking through online travel agencies and direct with airlines
  • Over 90 tour operators package California in the United Kingdom, catering for all tastes, niches and budgets

 


 

Target Profile

   
Primary Target
 
Demographics
  • Top 33% HHI
  • Passionate about or regularly travel
  • Domestically/abroad
  • Travel by air for vacation 1+ times annually
  • Vacation decision-making involvement
 
  • 44 — Median age
  • 58K pounds — Median HHI
  • More likely to be married (59% / Index 128)
  • Less likely to have children (52% / Index 93)
Source: Carat CCS    

 


 

 

Other Market Insights

   
  • Market:
    • Travelers willing to spend more for desired vacation
      • According to a recent report from ABTA, U.K. consumers will be looking to spend more in 2017 in order to secure the exact holiday desired
      • Debates over school holiday pricing continue; however a landmark case this year may have set a precedent - a father’s appeal was upheld after he was fined for taking his daughter on holiday during term time
    • Product Experience:
      • Value-adds sought by travelers, including luxury
        • With the pound weakened against the dollar, consumers are looking for value-adds to ensure they’re getting something extra from their holiday expenditure
    • Audience:
      • Luxury travelers seek authentic, unique experiences
        • As with other markets, consumers at the luxury end of the U.K. market are looking for unique experiences and ways to enrich their travels with authenticity
    • Communication:
      • The use of mobile devices for planning continues to grow
        • Growing mobile use for planning confirms value in most operators’ move to mobile-first technology, despite the majority still preferring to actually book holidays through desktop
        • Travel agents still play an integral part of the U.K. holiday market, looking after some 30 percent of bookings while the rest go online or direct to the major tour operators
        • Kayak launched TV advertising in the United Kingdom in 2016


Source: ABTA Travel Trends Report 2016

 


Brand Foundation

 

Brand Platform

California Attitude
Californians have a unique approach toward life, with their laid-back, welcoming demeanor.

Abundance
California is larger than life, with a “supersized” image of being big and plentiful.
   

 

 

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