A recent report by NatWest Retail and Leisure reveals that a significant portion of UK consumers are gearing up to spend more on holidays this year, despite facing financial strain due to inflation and high interest rates.
The report, based on a study of 2,000 UK consumers, indicates that approximately one-fifth (17.3%) of Brits are planning to boost their holiday expenditure.
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This finding comes amidst concerns over dwindling purchasing power, with nearly half (44.0%) of surveyed consumers expecting their finances to weaken in 2024 compared to the previous year.
Changing trends among generations
While younger generations, including Gen Z-ers and millennials, feel the pinch more acutely, they are not giving up on holidays altogether.
Instead, they are opting for cheaper alternatives such as shorter trips or domestic destinations.
Despite the country’s economic uncertainties, a substantial proportion of consumers are unwilling to compromise on their travel plans.
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By GlobalDataDynamic pricing and consumer behaviour
The report also highlights shifting consumer preferences towards dynamic pricing, especially in the hospitality and airline sectors.
This trend reflects a desire for transparent pricing amidst budget constraints. However, maintaining customer trust remains paramount for businesses in these sectors.
Richard Lim, CEO of Retail Economics, noted that holidays have become indispensable for households, with consumers prioritising travel over other expenses, despite facing budgetary pressures.
