Incentives and prices help fuel growth throughout the market
ATLANTA; Nov. 25, 2002 – Holiday travel for 2002 is likely to increase slightly over travel during the holiday season last year, according to an Accenture (NYSE: ACN) survey of more than 1,000 people in the United States.
More than one-third of survey respondents (35 percent) said that they expect to travel more than 250 miles for Thanksgiving, Christmas and New Year’s this holiday season, versus 29 percent who said they traveled more than 250 miles during the holiday season last year. In addition, more than two-thirds (70 percent) of respondents who traveled during the 2001 holiday season said they plan to travel again during the 2002 holiday season.
More than 81 percent of respondents said they expect to fly on a major domestic airline during the holiday season, and almost all of the respondents (99 percent) said they plan to travel either by automobile, airplane or a combination of both to reach their final destinations.
“Despite facing many obstacles in the past year, the travel industry has been building customer confidence and bringing customers back,” said Ron Stewart, a partner in Accenture’s Transportation & Travel Services practice. “However, the days of pricing to profitability are gone. What we are seeing this holiday season is further evidence of a price war within the entire travel sector.”
Convenience and price influenced respondents’ choices of airlines more than any other factors, selected by 65 percent and 64 percent of respondents, respectively. Airline brand was the third-most-selected factor, chosen by 21 percent of respondents. Although price was a major factor in choice of air carrier, only one-fifth of respondents (19 percent) said they plan to fly on a low-cost carrier during the holiday season.
While the majority of respondents who plan to travel this holiday (64 percent) reported that they will be staying with friends or family during their holiday travels, one-quarter (25 percent) of those planning to travel said they will stay at a hotel. Those who will be staying at hotels cited location as the number one reason (selected by 43 percent), but respondents also said they chose a hotel because of a special discount offer or vacation package (25 percent).
“While low-cost carriers continue to make market share gains, the findings of our survey indicate that major domestic airlines can compete by building brand loyalty,” said Stewart. “People like the recognition and perks that come with being loyal to one carrier, but only if it comes at a low price. Hotels, however, are in a different position, as they buy customers with low-cost packages that push down yields and hurt their profitability.”
The survey, conducted in November 2002, entailed querying more than 1,000 consumers in the United States. The multiple-choice survey was conducted entirely online and has a margin of error of +/- 3 percent.
Accenture is the world’s leading management consulting and technology services organization. Through its network of businesses approach–in which the company enhances its consulting and outsourcing expertise through alliances, affiliated companies and other capabilities–Accenture delivers innovations that help clients across all industries quickly realize their visions. With more than 75,000 people in 47 countries, the company generated net revenues of $11.57 billion for the fiscal year ended August 31, 2002. Its home page is www.accenture.com.