The return of post-pandemic foreign travel shows no sign of slowing down. In fact, demand for vacation travel out of the US is strong enough to put pressure on US domestic routes which are seeing more empty seats than is comfortable.
Capacity, capacity, capacity
It’s not just flights to overseas destinations that are mostly full. Accommodation occupancies levels are higher than they have been for several years, especially in Europe, and in particular at higher end hotels. For flights and hotels alike, if demand is high and seats and rooms are getting scarce, prices rise.
The details of this are neatly explored in an article by CNBC’s Leslie Joseph and Gabriel Cortes1. The picture they draw is supported by the data and some key numbers illustrate the still very elastic demand for foreign travel. For example, by end July this year, international airfares averaged $962, up 10% from last year and 26% from 2019. And while flights cost more, so do rooms. In the first half of 2023, room rates for European hotels were up nearly 14% on last year’s prices, averaging just shy of $150 per night.
Patterns in demand signal a longer trend
Higher prices reflect inflation. But the fact that demand remains high suggests something else is at work as well. Joseph and Cortes quote Marriot International’s figures that second quarter room revenue in the US and Canada rose 6% on the previous year; international market growth rose 39%.
So what’s happening? Most obviously, what many thought was a post pandemic foreign travel “bubble” looks more like a stream growing into a river. Interest in vacations abroad continues to be strong despite higher prices.
Being organized = happier travel
When high demand creates pressure on capacity, those wanting to travel often need to make decisions quickly, sometimes with only a few days to spare.
As always, the bank or credit union that meets customer needs quickly and easily is well-placed to grow their business.
Today, ‘quickly and easily’ means digital and, for consumers, usually via a cell phone. Also, very often it means easy and reliable access to foreign currency as cash – quite literally, most travellers like to have money in their pocket. And they want to get it there without lots of paperwork or standing in line.
Enter Money 4 Travel – travel money at the customer’s finger tips.
Money 4 Travel from Essiell is an example of a reliable, efficient, and cost effective service that keeps life simple. Currency is booked online and collected from a chosen branch. It’s easy and transparent, and requires no big infrastructure investments. It makes a significant contribution to the omni-channel digital environment that increasingly marks out successful financial providers. Customers who can access this sort of convenient, reliable service will keep coming back for years to come.
By Bjorn Larsson, CEO at Essiell Ltd, the power behind Money 4 Travel. Essiell is a leading specialist in fintech solutions for retail travel money, financial control, information technology and data security, and compliance.
To find out more about Money 4 Travel, watch this video and go to www.money4travel.us