How rising living costs are pushing travelers to spend less, book smarter, and rethink loyalty
Oct 24, 2025
Recent research by Phocuswright Research shows that while Americans are still taking about the same number of trips, they are spending less, choosing more value-driven booking methods and reordering priorities under economic pressure.
Key takeaways
- Trips remain stable: Leisure travel incidence hasn’t dropped significantly, but average annual spend has declined.
- Spending versus value trade-off: Many travellers say they’re willing to switch to road trips instead of flights — or skip travel altogether — if costs climb.
- Channel behaviour shifting: Younger, cost-conscious travellers are leaning more heavily on online travel agencies (OTAs) for price comparison and leveraging indirect booking channels.
- Search dynamics changing: Traditional generic search usage is declining, possibly as AI-powered tools and more deliberate planning gain ground.
- Loyalty and demographics evolving: The report notes a slight influx of younger travellers and a beginning of exit among older, seasoned travellers — with implications for loyalty strategies.
- Value over luxury: Lodging, destination choice and travel mode decisions are increasingly being guided by price sensitivity and value rather than premium spend.
Get the full story at PhocusWire
