Revenge travel fuels Canadian travel intentions

This year, Canadians are projected to spend over $14 billion on travel — a figure which even trumps peak pre-pandemic levels. That’s according to findings from Allianz Global Assistance, who gains customer travel intensions and trend insights from an annual Vacation Confidence Index survey as well as monitoring data from things like an internal analytics platform.

In the so-called “new normal,” Dan Keon, vice president, marketing & insights at Allianz Global Assistance, said “we often refer to it as the ‘no normal’ because things are changing at such a rapid pace rate that it’s almost impossible to pin anything down.”

Notably, he said it’s been interesting to track how consumer behaviours have shifted in the Vacation Confidence Index survey coming out of the pandemic.

“A few key findings: Canadians are feeling really good about travel and are very excited to be travelling again,” he shared.

Although there was already “a very aggressive rebound in 2022” amongst Canadian travellers, he shared that travel truly started booming after restrictions fully lifted and the uncertainties around what travel would be like started to ease.

“2023 is the year we’re seeing that full ramp up,” he said, “There’s a strong sense of revenge travel — so people who have been thinking about travel, dreaming about travel for years literally during the pandemic, couldn’t wait to get out there — now are taking some of those real bucket list trips and that’s being reflected in the spend. Canadians were anticipated to spend over $14 billion on travel based on the findings in our survey, which was the highest amount we had seen since we started running this survey in 2016.”

Despite looming economic concerns for a potential recession and inflation, he noted that Canadians are also prioritizing travel.

“Another finding, that isn’t really surprising to be honest, is the fact that Canadians felt that travel insurance was more important than ever before,” he added. “I think, if the pandemic did anything, it made people realize how quickly things can change and how unpredictable travel can be.”

Beyond the Vacation Confidence Index survey, Canada is also part of a widespread Customer Lab research on overall lifestyle, purchase behaviours and findings on travel and travel insurance. Those findings show that Travelling Millennial Families aged 26-40 years old with at least one kid at home, are increasingly becoming more sensitive to the environmental impact of their travels.

“The Traveling Gen X family [aged 41-55] what we’ve seen in this age group is very concerned about curating the trip and making sure that they are choosing experiences that really reflect their wants and needs and perhaps being prepared to spend more for those experiences,” he added.

Meanwhile, Matt Anstett, director, eComm & travel channel at Allianz Global Assistance, pointed out that travellers are planning ahead more and buying insurance earlier.

“This is actually driven by younger people, some of those millennial groups. Older travellers have always planned well ahead, they’ve always bought travel insurance early,” he said. “Now we’re seeing those younger groups do the same. Not to the same extent but they’re upping the average overall. They’re thinking about travel protection more coming out of the pandemic. They are planning not just their trip but all the elements of their trip a lot earlier than they were prior to the pandemic.”

While revenge travel has been fuelling trips, he said there’s also been a return to shorter getaways this year as well.

“We’re starting to see those long weekends, those quick last minute trips, things like that, pop up more and more,” he said. “Quick getaways are back this year. Last year it was just the big stuff, this year, the smaller stuff is layered in as well.”

Interestingly, loyalty matters increasingly to Canadians through things like special preferred pricing, collecting points to redeem for future purchases, complementary upgrades, etc.

Anstett also agreed that Canadians have prioritized travel more and more.

“One trend that we’re seeing and that we’re relatively competent in predicting is Canadians are going to continue to travel this year and likely in early 2024,” Anstett shared. “As much as there’s news everywhere about a recession, housing markets and everything going on economy wise, Canadians have shown the desire to continue to travel. It has almost moved up in the pecking order in their spending over the pandemic. It’s less seen as a discretionary, kind of nice-to-have and much more of a ‘I need to do this.’”

When asked if there was a shift to direct VS agent bookings, Anstett said this wasn’t the case.

“Travel agents [is a big distribution channel]— because people are investing all this money in their trip, when their travel agent asks if you want to protect this investment, it’s top of mind and it’s much more likely that they will purchase,” he noted. “I would say of all of the channels, direct purchases, where Canadians come directly to the insurer, is the smallest of all the channels because there are so many options where people have distributors that they’re comfortable with. They know they need insurance, but they don’t necessarily understand it. So they typically want to be working with a distributor or a brand or somebody that can inform them, ask them questions and get them the insurance they need.”