The State of the American Traveler in May 2024—Record-Level Travel Budgets, Current Trip Motivations, Ads on Streaming Services, Hybrid Workers

IMPORTANT: These findings are brought to you from our independent research, which is not sponsored, conducted, or influenced by any advertising or marketing agency. The key findings presented below represent data from over 4,000 American travelers collected in April 2024.

Travel Spending Outlook Remains Sunny

Despite a somewhat ambivalent outlook on personal finances, Americans’ travel spending outlook remains relatively sunny. This month, the share of American travelers who said their current household financial status was better or much better dropped to a seven-month low of 30.2 percent. This decline is driven by older travelers, as only about a quarter of Gen X (25.7%) and Boomer+ (23.2%) travelers saying they are financially better off now compared to a year ago. In contrast, younger American travelers are more optimistic: nearly half of Gen Z (46.1%) and four in ten Millennials (40.4%) say their finanical status has improved relative to last year. Expectations for future finances is in a slightly better position at 45.6 percent of total U.S. travelers saying they anticipate being better off this time next year, though note that this too has dropped to the lowest point it has been since January 2023.

Nevertheless, in positive news for travel, the number of American travelers who said the present is a good or very good time to spend money on travel held relatively steady at 32.3 percent, well above the last decline that we saw in August and September 2023. Similarly, well over half (58.6%) say that travel spending will be a high priority for them in the next three months, continuing the gains seen since February of this year. In fact, the expectation to spend more in the next 12 months on leisure travel saw an uptick of +2.7 points month-over-month, increasing to 33.6 percent of American travelers. Additionally, the average maximum annual spend for leisure travel in the next 12 months reported this month was $4,826, one of the highest on record.

U.S. Travelers Prefer an Ad-free Netflix Experience, but Not Necessarily for Prime or Hulu

As the streaming service landscape continues to evolve, we see emerging trends in which platforms American travelers are willing to pay a premium for an ad-free experience versus capitulating to being served advertisements in exchange for bundled or lower rates. Looking back at January data collected prior to Amazon's launch of their ad-supported tier, Prime Video was the top-most regularly consumed streaming service at 51.9 percent of American travelers. Now, Netflix's ad-free tier is in the top spot at 41.3 percent (23.9% instead opt for the ad-supported tier). Further, this month's data indicates that 34.7 percent are using Prime Video's ad-supported tier while 28.2 percent are paying for the ad-free tier. Interestingly, of the biggest streaming services (Netflix, Prime Video, Hulu, Disney+, and HBO Max), Hulu and Prime Video are the only platforms that have a higher share of U.S. travelers who opt for the ad-supported tier rather than pay more for an ad-free experience. Why does this matter for travel marketers? Every month, we ask travelers which resources they would be most receptive to learning more about a destination, and streaming services are consistently ranked in the top 6 resources, particularly among Gen Z and Millennial travelers while Boomer+ travelers are less likely to be receptive to destination messaging on streaming platforms.

Taking a closer look at which services different generations of travelers are consuming ad-free versus those where they are currently being served ads, Gen X (37.5%), Millennial (36.9%) and Boomer+ (32.2%) travelers are much more likely to be on ad-supported Prime Video compared to Gen Z (26.4%). But Gen Zers (32.4%) are the most likely generation to regularly consume Hulu’s ad-supported tier (32.4%), while Boomer+ (19.3%) are the least likely. For Netflix’s ad-supported tier, Millennials are significantly more likely (28.1%) to be subscribing to this option compared to other generations, especially Gen Z (18.7%).

Working Arrangements Impact Travel Outlook in Surprising Ways

This month, we explored what travelers' working arrangement currently looks like.

Since the pandemic, the nature of work has changed significantly, with some workers returning full-time to the office, others experimenting with a hybrid schedule, and still others are working remotely. We found that while the majority of employed travelers now work on-site (65.3%), a sizeable share are doing a hybrid model (21.4%) and over one in ten (13.4%) are fully remote. While some of the findings came as no surprise - for instance, that remote workers are the most likely to be concerned about crowds when traveling or that hybrid workers are the most likely to live in a large city - investigations into certain aspects of these travelers, especially around travel outlook, yielded surprising results.

First and foremost, hybrid workers are the travelers to target in terms of general positive travel outlook and spending intent. They have the highest annual travel budget ($6,369 compared to $3,865 for on-site workers and $4,504 for remote workers) and were the most likely to say they expect to travel more (36.4%) as well as spend more (38.9%) on travel in the next 12 months. While remote workers were more likely than on-site workers to say they expect to travel more in the next 12 months (31.9% vs. 26.6%), they were actually less likely than on-site workers to say they anticipate spending more on travel in the same time period (31.9% vs. 32.4%). Similarly, seven in ten hybrid workers will prioritize travel spending in the next three months, while 57.7 percent of on-site workers and 56.3 percent of remote workers said the same. Notably, hybrid workers also have the highest income among the set and are also the most likely to be married/partnered and/or to have children under the age of 18.  Hybrid workers are also more likely to have recently traveled for business/convention purposes (20.7%) and to international destinations (25.0%). 

What's Driving Americans to Travel Right Now

When asked about their most recent trip and what played a role in their decision to take it, visiting friends and family (50.9%), relaxation (45.6%) and escaping the stress of daily life (34.2%) are the most common trip motivators, followed by self-care (21.9%) and spending time in the great outdoors (20.1%). When it comes to the specific activities motivating trips right now, while food is king (37.4%), Americans travel specifically to engage in several pursuits including shopping (22.9%), outdoor activities (19.8%) meeting/interacting with local people (16.3%) and getting content for their social media (14.1%). It appears age plays a role in travel motivation, as the older one is, traveling to visit friends and family increases while traveling to escape the stress of daily life decreases. Meanwhile, younger Americans are more motivated than older ones to travel for the purposes of self-care and bragging rights. 

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