PwC Report Highlights Resilience in Holiday Travel Amid Decline in Consumer Spending

What's Happening?

A recent report from PwC reveals that despite a 5% decline in overall holiday spending by U.S. consumers, travel demand remains resilient. The 2025 Holiday Outlook indicates that travel and entertainment are expected to increase by 1% year-over-year, marking a bright spot in an otherwise tighter season. The report highlights that 44% of consumers plan to travel during the holidays, with Millennials and Gen Z leading the intent at 55%, while Boomers and Gen X show lower travel intentions. The report also notes a shift towards visiting friends and relatives, with 48% of travelers citing family and friends as the primary reason for their trips. Generational spending patterns show divergent paths, with Gen Z planning a 23% pullback in holiday spending, while Boomers expect to spend 5% more.

Why It's Important?

The resilience in holiday travel demand is significant as it underscores the emotional and social importance of travel, even amidst economic constraints. This trend suggests that consumers are prioritizing experiences and togetherness over material goods, which could influence travel operators to focus on value clarity and segment-savvy offers. The report also highlights the growing role of AI in travel planning, with 76% of Millennials likely to use AI agents for travel recommendations. This shift towards AI-driven trip planning could reshape the travel industry, requiring brands to adapt by providing AI-readable content and structured data to remain visible in the new 'assistant-first' funnel.

What's Next?

Travel operators are advised to target Boomers and Gen X with confidence, as these cohorts show steadier or rising spending patterns. Emphasizing comfort, reliability, and seamless service could attract these groups. Additionally, operators should consider creating 'home for the holidays' packages near residential hubs, offering flexible date changes and simple add-a-night extensions. Protecting late demand by holding back inventory for last-minute bookings and streamlining mobile checkout processes could unlock further conversions. The report suggests that operators who meet the moment with value clarity and AI-ready content will not only weather the season but potentially win it.

Beyond the Headlines

The report hints at deeper implications for the travel industry, particularly the need for operators to adapt to changing consumer behaviors and technological advancements. The integration of AI in travel planning could lead to more personalized and efficient travel experiences, potentially transforming how consumers interact with travel brands. Additionally, the focus on visiting friends and relatives suggests a cultural shift towards valuing personal connections, which could influence travel trends in the long term.