When we asked a sample of Zoomers — aka Generation Z — how often they traveled before the pandemic, 53% said “1 or 2 times per year”.
And when asked in late 2021 when they’d be most likely to travel again, 28% of them “in the next year”. Then 2022's economic woes began, and it seemed like all bets were off.
But did they stop traveling? Nope – and the industry isn't quite on its knees yet. Gen Z continues to play a huge role in keeping it afloat, and anyone working in a travel-related business would be wise to know what makes them tick.
What does Gen Z care about in travel, and how are brands responding to them? This resilient, creative, and energetic cohort of consumers has a unique set of demands for travel brands around the world. Using data from both Latana and the wider world, we've looked into what really works for getting Gen Z travelers to part with their hard-earned cash.
Here's what we found out.
Gen Z Wants To Travel, Whatever the Weather
As of August 2022, the US “travel price index” — a tracker of general sector prices like transportation, accommodation, and restaurants — shows a significant increase over previous years. Since 2021, it's up 10.8%, and up almost 17% compared to pre-pandemic levels.
Travel and tourism, like many things right now, are more expensive than they used to be. The state of global travel has been pretty turbulent since 2020, and it may seem like optimism surrounding this sector is a long ways away.
But it's not all over yet. Planes are still flying, new hotels and bars are still opening, and startups continue to raise funding to disrupt the travel industry.
Gen Z is one of the fastest–growing and most important consumer segments to play a part in this. According to Student Beans, 75% of UK Gen Zers intend to go traveling or backpacking in the near future.
As Statista reports:
"In a May 2022 poll on the impact of high prices on summer travel plans in the U.S., nearly a third of surveyed Americans intended to use alternative means of transport instead of flying."
Translation? Travel plans are being changed, not canceled.
Despite economic difficulties, those that want to travel will find a way to do it. For Gen Z, it's an important part of their lives and identities, and while they might not be happy about paying an additional 10% or more for their travel indulgences, they still think it's a worthy spend.
Sure, the economic situation will have an impact on the big picture, but smart brands that can understand what these consumers really care about will have a much easier time reaching them and earning their business.
How do you go about doing that? Let's take a look.
Four Ways Travel Brands Can Reach Gen Z Effectively
1. Focus on Sustainability
Sustainability is something Gen Z cares deeply about. Using Latana data, we found that when on vacation, 30% of Gen Z travelers are looking for eco-friendly accommodation — that's 50% higher than Boomers. (Eco-friendly accommodation can range all the way from off-grid forest cabins to luxury city hotels that use sustainable materials and energy production methods.)
Sustainable travel in a wider sense can manifest in a range of ways. It could be sustainable transit, accommodation, products, experiences, or more. These things can be directly eco-friendly, or indirectly, if they contribute to carbon offset schemes or environmental organizations like charities and nonprofits.
For example, according to Contiki, 66% of Gen Z travelers want to avoid single-use plastics on their adventures. That could provide an opportunity for air and train travel companies (which often serve plastic-wrapped food items), hotels (with lots of plastic bathroom items), or any retailer involved in the travel experience.
The key aspect of getting this right, as with any branding project, is to be authentic. Building trust with consumers involves more than just slapping a logo on a product and expecting the praise to roll in.
Maybe that involves becoming a B-corp (meaning the entire business and supply chain adheres to strict environmental and social responsibility criteria) or being publicly transparent about which parts of the business are eco-friendly and which aren't.
As we found in our deep dive into sustainability in the travel industry, there are some smart ways to tackle this — initiatives like BookDifferent's green labeling system show potential customers how environmentally friendly each purchase decision is.
2. Emphasize Price
Being in the early stages of their careers and lives, Gen Z travelers don't always have huge spending power when it comes to travel. They care about paying low prices, and this is especially true when the whole sector is suffering from price inflation.
Brands like budget hotel chain Premier Inn are poised to be a winner in difficult economic times. In fact, UK Gen Zers show a similar preference for Premier Inn as they do for Airbnb, with just under 40% willing to consider booking with either.
In many of their consumer purchases, Gen Z uses Buy Now, Pay Later (BNPL) services. 61% of consumers aged 18-24 report using a BNPL service such as Klarna. While it's not particularly responsible to encourage consumers to go into debt to buy your products, it's a reality of many shoppers' experiences. So it makes sense to offer it as part of a payment option, if possible.
Furthermore, brands that empathize with consumers during the cost of living crisis will thrive, opines Andrew Turner in The Drum:
"Looking after (customers) during difficult times, with reward schemes and promotions (for example), will generate more interest and drive conversions from both existing and new customers."
With Gen Z expected to feel the impact of economic trouble the hardest, helping them keep their travel dreams a reality will be most welcome.
It's not quite as simple as “sell cheaper stuff to Gen Z”, though. Consider accommodation, for example. We found that:
17% of Gen Z consumers would be willing to pay $101-150 per night for travel accommodation.
When traveling, 30% of Gen Z consumers are willing to pay $51-100 for accommodation, and 7% will pay $250-500.
46% of Gen Z would be willing to pay more for higher-quality travel accommodations.
The range of prices they're willing to accept varies quite a bit. And a large chunk of this group are seriously into luxury brands, too. So you'll need to segment your target audience by more than just age.
3. Offer Flexibility
Flexibility, in one sense, is all about being protected. Gen Z suffered from canceled plans during the pandemic as much as everyone else, and don't have the budget to lose when plans go awry. The pandemic isn't quite over yet, and it'll continue to impact travel, for the time being. So nobody wants to be left out of pocket.
This is especially important to young consumers — we found that 39% of Gen Z consumers would be willing to pay more in their bookings for free cancellations, date changes, and refunds. Offering guarantees like this is a fairly simple win for travel brands wanting new customers to take a punt on them.
Gen Z also wants flexibility in the way their trips are arranged. The idea of a “trip” can have various meanings for them. It could be a city break, or it could be a hiking adventure through the jungle. It could be a night spent in a nearby town when there's an event on. The ETC reports that discovering new destinations is something young travelers care about (unsurprisingly), and choice is important to them.
This ties in well with their love of experiences. One particular example is in the Asia-Pacific region, where Gen Z guests make up the fastest-growing guest group for Airbnb Experiences, choosing curated tours and creative activities in places like Bali, Tokyo, and Sydney.
4. Embrace UGC
User-generated content (UGC) continues to do well across the board in 2022, and Gen Z is certainly a part of that. Airbnb, one of the pioneers in travel-based user-generated content, is one of Gen Z's favorite global brands. In fact, we found that 42% of Gen Z think that Airbnb has the best social media presence for a travel brand.
Influencers certainly play a significant part in travel marketing, and that's not stopping anytime soon. But Gen Z won't just blindly follow the recommendation of anyone with a million followers. They're more discerning than that.
Content has to be more authentic than ever to really reach them. While Forbes reports that the “Instagrammability” of a destination plays a key part in Millennials' booking decisions, this might not be the case for the less showy, more privacy-focused Gen Z. A less polished, filtered aesthetic tends to work better for the younger crowd. As Modern Retail reports, "less polished customer images tend to be more effective in creating buzz".
Interactivity is a great way for people to express their identity. So, user-generated content is a fantastic way of expressing both individuality and the causes that people care about. With 30% more Gen Z showing support for same-sex relationships than Boomers, LGBT+ issues are one such cause that this group is happy to shout about.
Travel fare aggregator Orbitz expressed its commitment to the LGBT+ community with a campaign called “Travel as you are”, which promoted destinations and ideas for LGBT+ travelers to enjoy their journeys where they're "celebrated, not tolerated". This included an interactive engagement drive inviting consumers and artists to share their thoughts.
A careful balance has to be struck with things like this, due to the risk of rainbow-washing or claims of insincerity. But a sensitive, appropriate engagement with LGBT+ and other minority communities can make for some really authentic and successful UGC campaigns.
No business is immune to the realities of the global economic situation. And Gen Z, being early in their lives and careers, don't always have the biggest spending power. But they're such an important group — they're the consumers of the future, driven by values and purpose, with growing spending power and a desire to have their voices heard.
Other causes Gen Z cares about, according to the European Travel Commission's 2020 report, are personal health & wellbeing, personal image curation, equality, privacy and trust, and access (renting) vs. ownership.
Some travel brands are still figuring out the best ways to approach these issues, and some have it nailed already. These days, it's not enough to generalize with statements like "they use social media a lot". This discerning, complex generation of young people sees the world differently and travels differently, and brands need to respect that.
With a smart, data-driven approach, Gen Z can be understood and catered for well. Travel brands that lean into this are poised to win a new generation of fans for life.