NTA releases key findings from 2001 Packaged Travel in North America study

The National Tour Association released key findings from its 2001 Packaged Travel in North America study . As with last year’s inaugural study, the focus is exclusively on the packaged travel segment of the industry.
“The key finding was that packaged travel is big business,” said NTA Chairman Kathy LeTarte, CTP. “In addition, the economic impact of leisure packaged travel increased during 2001, and packaged travel overall attained extremely high consumer satisfaction levels.”

For purposes of the study, packaged travel is defined as a trip arranged by a travel professional that includes at least two travel elements, such as transportation and accommodations. Packaged travelers may travel independently or as part of a group.

Key findings of the study are the following:

Economic Impact

The worldwide economic impact of packaged travel declined by 11 percent in 2001. Packaged travel had a direct economic impact of $166 billion worldwide last year, compared to $186 billion in 2000. North American travelers spent $98.7 billion on trips to the United States, a 6 percent decline, and North American travelers spent $12.9 billion on trips to Mexico, a 9 percent decline. Canada, on the other hand, experienced no change, remaining at $9.5 billion. The sharpest decline in 2001 was seen in international travel, defined as travel outside North America, at $44.7 billion, down from $57.3 billion last year – a decrease of 22 percent. When segmented into independent versus group travel, independent packaged travel declined 9 percent while group packaged travel declined 13 percent.

Economic Impact: United States

Within the United States, expenditures made for leisure packaged travel increased to $76.2 billion last year from $71.9 billion in 2000 – an increase of 6 percent. Business packaged travel, however, saw a decline of 33 percent, with $22.5 billion in expenditures. In 2001, North American business travelers attributed $22.5 billion in expenditures in travel to the United States compared to $33.5 billion in 2000.

“With most of NTA’s members focused on leisure packages, the strength shown in this area is gratifying,” said NTA President Hank Phillips, CTP. “It speaks well of the core popularity of this form of leisure travel.” Of the $98.7 billion spent in the United States, more than three quarters or $74.9 billion was the cost of the packages. The additional $23.9 billion was spent by travelers in addition to the initial cost of the package.

Overnight Packaged Trips: United States

Overall, packaged travelers took 119 million trips in the United States during 2001 – a slight decline from 131 million in 2000. Breaking out the number of trips by quarter also reveals a trend. Packaged trips actually started declining in the second quarter of 2001, well before the Sept. 11 tragedy. The sharpest decline was seen in the fourth quarter, post-Sept. 11, which was down 17 percent from 2000. A decline of 13 percent was seen in the third quarter, which included September.

Of these 119 million trips, 96.7 million were leisure packaged trips and 22.3 million were business packaged trips. Both business and leisure saw a slight increase in the first quarter before starting to decline in the second quarter. Business packaged trips were hit the hardest with a 30 percent decline in the second quarter, a 21 percent decline in the third quarter and a 27 percent decline in the fourth quarter. While the number of leisure trips declined somewhat, the largest declines were in the third and fourth quarters with 11 percent and 15 percent respectively.

“The data reflects the obvious negative impact of Sept. 11 and the economy. But even in the face of some predictable declines, the fact should not be lost that there were more than 96 million leisure packaged trips in 2001. That is enormous,” Phillips said.

Packaged Travel Planning Sources

A majority of independent travelers utilized travel agents when planning their trips, compared to 38 percent of group packaged travelers. More than one-third of group travelers use a tour company as a planning source, while only 18 percent of independent packaged travelers did so.

The Internet was most popular among independent packaged travelers with 28 percent utilizing it as a planning resource. Only 9 percent of group packaged travelers utilized the Internet as a planning resource.

Packaged Travel Booking Contacts

Half of independent packaged travelers and 29 percent of group packaged travelers booked their trips through a travel agent. Group packaged travelers are more likely to book their trip through a tour company (34 percent) than independent packaged travelers (15 percent).

While the Internet is a great planning resource, actual booking numbers through the Internet for both independent and group packaged travelers were low. Independent packaged travelers booked 6 percent of their trips, and group packaged travelers booked 1 percent of their trips through the Internet.

Packaged Travel Trip Length

The length of an independent packaged traveler’s trip increased from 5.9 nights in 2000 to 6.3 nights in 2001, while the group packaged trip was shorter, decreasing from 6.8 nights in 2000 to 6.3 nights in 2001. However, both remain higher than the U.S. norm of five nights.

Daily Expenditures Per Person

The average daily expenditure per person by North American travelers to the United States and Canada is about $174 for the group packaged traveler and $173 for the independent packaged traveler. However, the average daily expenditure per person by the U.S. packaged traveler to any destination was $188 for the group and $193 for the independent packaged traveler.

“Given these statistics combined with the fact that packaged travelers tend to stay longer than the average U.S. traveler, this is an additional influx into a destination of anywhere between $173 and $193 per day per traveler,” Phillips explained.

Packaged Traveler Satisfaction

Packaged travel attained extremely high consumer satisfaction levels. Overall, packaged travelers are very satisfied when evaluating value for the money, price and quality of their experience. In addition, group packaged travelers tend to be more satisfied than independent on all three categories, but the overall satisfaction numbers are outstanding, with 50 percent or better rating their experience as highly satisfactory.

Fifty-seven percent of group packaged travelers rated their overall travel experience as highly satisfactory, compared to 45 percent of independent packaged travelers.

Top Destinations for Packaged Travel

The leading state destinations for packaged travel in the United States were Florida, Nevada, California and New York. The leading cities were Las Vegas, Orlando, Los Angeles, Atlantic City and New York City. The Caribbean, Europe, Mexico, Canada, Asia and South America lead the way for trips outside the United States.

Survey Methodology

The 2001 NTA Packaged Travel in North America study was conducted by Dean Runyan Associates and Longwoods International. During each quarter of 2001, a survey was mailed to approximately 57,000 consumers in the United States and Canada. From these initial surveys, a panel was selected from those who had purchased a travel package. These travelers received a second, more in-depth survey regarding their packaged travel experience. Sponsors of the study include Student Youth Travel Association, Group Travel Leader and Group Tour Magazine.