Destination Dupes
Budget-conscious travelers are fighting inflation by getting off the beaten path
Summer travel season is finally here, and Americans are on the move. This year, they’re testing out new, more cost-friendly destinations in response to inflation.
A new Harris Poll commissioned by Intrepid Travel found that most travelers are adjusting or scaling back their summer travel plans due to economic concerns. The survey of over 2,000 adults found that a significant 66% are planning to moderate their plans because of economic factors, while an impressive 74% will opt for less popular, more affordable alternatives instead of well-known hotspots.
Yet, according to International Trade Administration data, nearly every region saw an increase in U.S. visitors in March 2024 compared to March 2023, with the exception of the Middle East, which experienced a 9% decline. However, the year-over-year increase varied by region. U.S. visitors to Asia jumped by 33%, while Oceania and Central America saw a 30% rise. Since the year before the pandemic, Central America saw 50% more U.S. visitors in March 2024 compared to March 2019, and nearly 1.5 million Americans visited Mexico, a 39% increase.
Further, based on the latest Longwoods International tracking study of American travelers in May 2024, 39% will likely embark on an international leisure trip within the next year. Among those planning international travel, 34% intend to increase the number of trips they take this year, 50% expect to travel abroad as frequently as last year, and only 16% plan fewer international trips.
“The expected boost in international travel by Americans is impressive, given lingering concerns about inflation and the financial health of the U.S. consumer,” said Amir Eylon, President and CEO of Longwoods International.
Dollars and Cents
Inflation has been hard on consumers, even those with the means to travel internationally, but there’s some good news for the price-weary this year.
According to NerdWallet's Travel Price Index, airfares, car rental rates, and hotel prices in April were lower than the same month last year, down by 1%. However, overall prices increased by 15% compared to April 2019, the last fully normal April before the pandemic. So, in effect, taking the same trip this year costs slightly less than it did last year but more than it would have five years ago.
On average, consumer prices across all categories, including groceries and gas, increased by 3.4% yearly through April.
Here’s how it breaks down by category for travel from April before the pandemic to today:
Airfare: Up 3.2%
Hotel Rooms: Up 14.8%
Car Rentals: Up 36.1%
Restaurants: Up 29.4%
Thanks to a strong economy, the dollar also goes further overseas than it used to, which means travelers may have greater purchasing power abroad than at home.
“Despite uncertain macro conditions, the dollar has continued to demonstrate strength—largely thanks to sticky inflation, a resilient U.S. economy and year-to-date highs in yields,” according to JP Morgan. “… The greenback has gained against just about every other major currency in 2024.”
Destination Dupes
Travelers are opting for cheaper alternatives to popular destinations to manage costs while enjoying similar experiences—they want more “bang for their buck.” For instance, they might choose Paros instead of the pricier Santorini in Greece or swap Barcelona for Valencia in Spain.
“Consumers more and more are expanding their appetites to trying new destinations, which spreads them out to experience places that are less traveled and more affordable,” said Brett Keller, the chief executive of the online agency Priceline in an interview with The New York Times.
In 2024, over half of American travelers intend to visit destinations where the cost of living is lower than in their hometown, according to Booking.com. Additionally, 60% stated they would seek "copycat vacations,” also known as “destination dupes,” which are more affordable alternatives to pricey locations.
But could this be a sign of travel trends changing for good?
In short, yes, because generational shifts are driving some of this change. Younger people travel internationally more than their older peers, tend to be more price-conscious and seek “authentic experiences.” According to Hopper, “GenZers making less than $50K per year are spending as much as 49% more on travel than older generations making the same amount.”
They are also more likely to visit a destination they've never been to before than to revisit a familiar location.
"TikTok popularized the idea of 'dupe' destinations and we believe the trend is here to stay," said Matt Berna, Intrepid Travel President, The Americas. "As we head into the busy summer travel season, Americans are more likely to choose an alternative, less-expensive trip due to increasing economic pressures.”
Where are you headed this summer? Have you traded in a hot spot for a destination dupe? Let us know.