I had compiled this for our marketing plan. The data is a few months old, but still relevant. I’m sharing it, because our industry should probably lay off the stereotypes, and misunderstandings, of what is soon going to be the largest market for business.
This Millennial Traveler data is vital to informing us about our future audience, and understanding how to reach them. We are watching for better segmentation on trends to denote which audience is reaching affluence, but it seems the typical millennial traveler uses most discretionary funds for both travel and experience. Instead of considering the millennial generation as a younger group, the data shows they are both maturing, settling down with families, and becoming a large market share of the business travel that supports part of our business. They will make up 75% of the work force by 2025, and currently account for approximately 45%. Millennials plan to travel more, compared to baby boomers (52.8% vs 32.1%), and they also plan to increase their travel spending vs boomers, as well (58% vs 41.3%).
This is due in large part to their inability or lack of desire to buy material items like houses or cars (and 44% of millennials go so far to suggest owning a car is a “hassle”. They are a sophisticated and cynical group of people who desire genuine and authentic experiences, exploring and discovery, and like some adventure, and fun, even when at work. In this, they like new moments, and experiences, versus typical brand loyalty and points programs. They will even invest in themselves to be healthier, as there is an understanding that it reduces long term personal costs, so wellbeing, fitness, health related wellness programs will make inroads with their interests. They eschew traditional advertising, and are more skeptical of anything that isn’t authentic, genuine, or transparent. They want to be able to share and tell the story of the brand, so cultivating the strength of our hospitality’s core amenities and offerings will help make the story diverse, and layered, so that they continually engage with the hotel and the idea of the brand, and its hospitality.
Millennials are spending, annually, more than $200 Billion dollars on travel experiences, and the data suggests future increased frequency correlating to their professional security. They are motivated by interesting destinations and authentic experiences. It is true that data suggests 44% of millennials prefer rentals to hotels, but that means 56% prefer hotels. What’s more, the striation of classes of service mean we can already exist as a special occasion event for a millennial, *during* a typical “rental” vacation. There’s growth in vacations where guests stay in multiple properties or units, and we can be tied to much of those road trip travels. However, the rental agencies like AirBnB seem to understand the millennial drivers better than our industry, and therefore lower to mid-range hotels have felt a pinch, while upper segment properties have not seen rental groups eating into revenues. There’re still economic struggles for millennials, from student loans, to making less than their parents. This, coupled with a thrifty mindset, has 1 in 3 millennials still living with their parents. These people born between 1982 and 2004, 18-35 years old are the future leisure and business, and it will be extremely important to note the affluence and rise of the affluent millennial traveler in the next 1-3 years.
There is a profoundly simple approach to planning for the new millennial traveler, which will simply become “our traveler”. They want a personalized journey, considering each individual’s unique preferences. Personalization will be vital in tailoring experiences based off of budgets and interests. Part of the personalization will be understanding the traveler, and guiding that guest to hidden gems, bustling neighborhoods, and interesting attractions. Eventually, we’ll want to cater to their desire for trip planning technologies to engineer a more seamless itinerary, and have our digital platforms engage and find value in each stage of the booking cycle. It is also important to note, currently, millennials have a far shorter booking pace than typical, general audiences. We can help plant the seed of longer booking windows by integrating with trip-planning platforms, or social sites that let them “carry” our brand around with them digitally until the moment they want to interact with, and book, the property, at their leisure. Part of delivering that authentic experience is understanding personalization, and available data, such that we can constantly deliver tailored experiences that maximize their perceived value. One of the reasons that millennials gravitate away from vacation rentals is the consistency of branded items and experiences, which positions authentic experiences and experiences like [our hotel] extremely well for the future.