THE POINTS GUY PRESENTS
Travel trends
For the love of travel.
Why and where Americans travel continue to evolve, shaped by changing global trends and conditions — from climate change and overtourism concerns to fluctuating prices and loyalty program devaluations.
What continues to be true, however, is that travelers are just as enthusiastic as ever to discover new corners of the globe — but with a renewed focus on getting value for their money (and miles) and the opportunity to explore their interests and passions.
Here are the top trends TPG experts are seeing across the industry — and what they mean for travelers in 2025.
Expect to spend more on travel in 2025
People took more trips in 2024, and they also spent more money on those trips. What exactly is fueling this increased traveler spending — is it due to higher prices? Not entirely.
If you think travel has become more expensive over the past year, you're not the only one. A Deloitte 2024 summer travel survey stated that 31% of respondents claim it's too expensive to travel right now, up from 24% in 2023.
We expect that trend to continue into 2025, as travelersprepare to continue spending more on their vacations.
In 2024, international visitor spending projected to grow globally by
16%
Data from World Travel & Tourism CouncilPercentage change in the travel price index in the United States in June 2024, by industry
Characteristic
2024 v 2023
2024 v 2019
Travel price index
+0.4%
+19.2%
Airfare
-5.1%
-6.4%
Lodging (hotels/motels)
-2.8%
+10.7%
Recreation
+4.1%
+17.2%
Food and beverage
+4.0%
+29.2%
Consumer price index
+3.0%
+22.7%
It'd be easy to blame rising prices across the board, but that's not the full story.
Inflation rates drove up expenses in some areas, and general travel costs are higher than prepandemic, according to Statista's analysis of the U.S. Travel Association's travel price index. Aside from airfare, all other areas have seen significant increases in pricing since 2019. But just because travelers are willing to spend more on trips they care about doesn't mean they aren't interested in deals.
So, how are travelers spending their money?
Authentic experiences are key
More traveler budget is being allocated toward experiences and nightlife, which accounted for 12% of tourism sales — the highest point in at least five years, according to Mastercard. This is, in part, perhaps due to an an increase in younger, aspiring luxury travelers.
According to McKinsey data, this new breed of luxury travelers has different priorities than older generations. More than half of Gen Z survey respondents and 47% of millennials say they would rather save money on expenses like flights by booking economy tickets or an itinerary with a layover instead of sacrificing the experiential aspects of their trips — authentic experiences, culture, novelty and history.
12%
of tourism sales is allocated towards experiences and nightlife
- authentic experiences
- novelty
- culture
- history
People are taking
longer trips
Travelers are also spending longer at their destinations, with the same study showing trip lengths have increased from an average of 4.5 days in 2020 to 5.5 days in 2024. This is especially apparent when traveling a great distance, or to sunnier climates — trips to Europe and Africa, in particular, were on average two and three days longer in 2024.
Average trip (in days)
in 2020:
4.5
Average trip (in days)
in 2024:
5.5
Younger generations are traveling farther from home
In the first quarter of 2024 alone, around 15.9 million people left the U.S., according to the Mastercard Economics Institute.Younger generations especially are booking international trips just as often as domestic flights, compared to older generations. With TikTok and Instagram showcasing a myriad of international destinations that might otherwise go under the radar, it's no shock that younger generations are adding those spots to their travel bucket lists. An October 2023 Deloitte survey found that 42% of Generation Z travelers and 26% of millennials used TikTok to plan trips.
Despite an increase in expected spending, the desire to travel hasn't waned.
66%
of respondents say they are more interested in travel than they used to be.
47% of millennials &
>50% of Gen Z
would prefer to save money on things like flights instead of sacrificing the experiential aspects of their trips.
Travelers are craving togetherness
and shared experiences
Call it a new era: With travel more accessible than ever before, many travelers are seeking connections through shared experiences — and they're taking advantage of the chance to see fun events while they're at it.
Nearly five years after the pandemic lockdowns, the desire to be with loved ones and friends — in person — has bumped up against the bonds formed with complete strangers when it comes to experiencing live events. And that's reflected in how we travel.
Traveling for concerts, sports or historic events is nothing new — but we entered a symbolic new era of event travel over the past two years thanks to Taylor Swift and “The Eras Tour.”
According to data from the U.S. Travel Association trade group, the tour's impact on U.S. destinations was the equivalent of 53 Super Bowls, with visitors spending an average of $1,300 each in local economies over 53 nights in 20 different cities. The group estimated a total $10 billion impact on travel surrounding the concerts, while Southwest Airlines noted a 10% increase in bookings in markets surrounding a tour stop.
Expedia found that Indianapolis and New Orleans were its fastest-growing U.S. destinations in fall 2024, with searches up 120% and 40%, respectively, driven by Taylor Swift's scheduled appearances there.
It's not just Taylor Swift, of course. Domestic and international concert tours, music festivals, and historical events like 2024's solar eclipse have all led travelers to plan short trips or full vacations. Deloitte's 2024 Summer Travel Survey shows a spike in specific events and activities as the motivation for trips in 2024 compared to 2023 and 2022. Nontravel spending during 2024 Carnival in Rio de Janeiro (restaurant, bar and grocery store purchases) increased by 156% compared to nonevent levels, according to the Mastercard Economics Institute. During the U.S. solar eclipse, there was a 71% increase in spending at hotels within the path of totality. Hotel demand in Manchester, England, surged coinciding with the planned Oasis reunion concert. Sports are a major driver as well, whether something like the Olympic Games in Paris or regular-season games for the NFL, soccer and more.
Events continue driving economic impact
Oasis Reunion
Hotel demand in Manchester, England surged coinciding with the planned reunion concert
Carnival
156% increase to restaurant, bar and grocery store purchases compared to nonevent levels, according to Mastercard
Solar Eclipse
71% increase in spending at hotels within the path of totality
Gen Z is especially fond of planning travel around a central event.
Even as “The Eras Tour” comes to a close, there's plenty happening in 2025 and beyond that will continue to draw travelers, from momentous concerts to regular-season sporting events. There is also a rise in other types of togetherness and common-interest travel, such as millennial-focused group trips and travel with groups like the Main Character Club.
Travelers looking to plan trips around events and experiences should book early, or they risk sold-out scenarios and exorbitant prices.
Points and miles are becoming more costly to earn and harder to use
Credit card annual
fees continue to rise
In 2024, the American Express® Gold Card hiked its annual fee by 30%, from $250 to $325. The annual fees on American Express' Delta Air Lines cobranded cards rose as much as 52%. As travel rewards cards become more costly to carry, potential cardholders must ensure they can obtain genuine value from a card's perks before deciding to open it. It's important to match a card strategy to your lifestyle and not the other way around. Otherwise, you may wind up spending money you wouldn't otherwise spend to justify keeping a card in your wallet. Now might be the time for an audit of the benefits and costs of the cards in your wallet.
SURPASS (2023)
ASPIRE (2023)
AMEX DELTA GOLD
AMEX DELTA PLATINUM
AMEX DELTA RESERVE
AMEX GOLD (2024)
AMEX BUSINESS GOLD (2024)
Redemption rates are rising, and elite status is harder to attain
Typically affordable partner programs also saw significant and unexpected price increases within the last year. British Airways' domestic Avios redemptions flying American Airlines and Alaska Airlines, which were previously reasonable in price, increased on average by 35% in Main Cabin economy and 39% in first class. Avianca LifeMiles also increased one of the best-value ways to fly first class to Europe by 50% without warning.
Playing the elite status game is getting more complicated. Gone are the days of just flying or booking hotel stays to earn status. Elite status on all of the major U.S. airlines can now be earned without stepping foot on a plane by having the right cobranded airline card and meeting the spending thresholds, and multiple credit cards offer automatic elite status with specific hotel brands. However, cardholders should be prepared to spend significant amounts on their cards to reap these benefits in many cases.
For casual travelers, elite status likely isn't worth striving for. Instead, they could get elitelike benefits by having the right cards or booking through the right programs (such as Amex's Fine Hotels + Resorts).
2025 is the year to get serious about your loyalty rewards and credit card strategy.
A clear strategy is more important than ever to ensure value can be obtained from points and miles and rising card annual fees.
TPG Points 101
It is critical to use points and miles rather than save them over the long term. Excellent redemption opportunities come and go, even on peak travel dates, so book first and ask questions later.
TPG's Points 101 short email learning series is a great way to set a goal for a travel redemption and work toward it, and our CardMatch tool can offer travelers personalized credit card recommendations that fit best into their lifestyle and 2025 strategy.
2025 travel plans will be shaped by the fight against overtourism
Local governments are looking to curb overtourism and overcrowding as residents push back against tourism in some destinations. Increasing regulations are limiting visitor numbers in popular cities, while tourists are more often looking to underrated destinations for their next vacation.
Residents are fed up, and local governments are stepping in
Overtourism certainly isn't a new concept, but the surge of post-lockdown “revenge travel” has shined a spotlight on the problem in recent years. Local governments in many popular destinations have begun to fight back against overtourism with new regulations.
We expect efforts like these to increase in 2025 as popular vacation spots seek a better balance between tourism's economic benefits and its impacts on local communities and the environment. Your 2025 travels to top cities will likely be more expensive, and you'll need to book early to snag limited cruise cabins or vacation rentals.
Travelers are gravitating toward less-crowded offseason and up-and-coming destinations
Travelers themselves have also not been happy with overcrowded cities and attractions, and are fighting overtourism in their own way. Expedia's 2024 Trends in Travel Report claims that “1 in 3 of those polled say they've booked a dupe.”
Like overtourism, destination dupes — under-the-radar alternatives to a travel hot spot — aren't a new concept. But the term has gained even more traction on social media in recent years.
Travelers who stick to these goals in 2025 might have a better vacation experience. Your wallet will benefit from fewer fees and lower prices, plus you'll get all the bragging rights of going somewhere incredible your friends have never been.
Tourist taxes and entry fees
Places that added or increased tourist taxes/entry fees in 2024: Amsterdam; Barcelona; Venice, Italy;
and Bali, Indonesia.
Galapagos National Park doubled its entry fee from $100 to $200 per person.
Visitor limits
Local governments in popular cruise ports are debating the merits of introducing limits on ships and passengers. Amsterdam; Bar Harbor, Maine; and Juneau, Alaska, have voted for future reductions; Greece has proposed both a tourist tax on cruise ship visitors and limits on the number of cruise ships in hot spots like Santorini and Mykonos.
Short-term rental restrictions
Maui, Hawaii; Atlanta; and New York City have put restrictions on Airbnb hosts that effectively reduce the number of rentals available to visitors.
76%
of travelers surveyed in 2024 are choosing offseason travel to avoid crowds
55%
are visiting tourist sites at off-peak times
31%
are considering less-touristed destinations for their next vacation
You'll be able to explore more comfortably with fewer crowds in less-touristed destinations or during off-peak seasons.
Here are a few destinations to keep in mind for 2025:
Athens Riviera
The Athens Riviera instead of Santorini — just 30 minutes by train from Athens, and you'll avoid the crowds but still experience luxury hotels with beach access.
Calabria
Calabria is a fine alternative to the Amalfi Coast. Located at the toe of Italy's boot, this region rewards visitors with its 500 miles of coastline and 20 “Blue Flag” beaches on the Coast of the Gods (Tyrrhenian Sea) and the Ionian Sea.
Seychelles
Choose the Seychelles instead of the Maldives for an equally luxurious overwater bungalow and dazzling blue waters.
Climate change is affecting
travel decisions (whether travelers realize it or not)
Travelers are driving growth to destinations with cooler climates during the peak summer travel season and enjoying extended shoulder seasons in places that get warm earlier than ever and stay hot well into fall.
According to the European Union's climate change monitoring service, 2024 marked the warmest Northern Hemisphere summer since records began.
Croatian authorities reported the Adriatic Sea hit its highest-ever recorded temperature (86 degrees Fahrenheit) in July 2024 near Dubrovnik, while Greece continued to fight back against summer wildfires after experiencing Europe's largest wildfire ever in 2023. As summer vacation hot spots get hotter — and more crowded — travelers are going to destinations with cooler climates in northern Europe and Canada to avoid extreme weather.
'Coolcations' are heating up
Destinations with cooler climates are seeing increased demand compared to the warmer destinations that typically come to mind when travelers think “summer vacation.”
According to Virtuoso's 2024 Impact Report, 72% of Virtuoso advisers reported that their clients said that changing climate and/or extreme weather affects their travel planning and choices, while 50% are traveling to alternative destinations due to the climate.
From June to August 2024, Virtuoso reported that year-over-year demand rose to these places versus the same period in 2023:
During that same period, demand was down to:
Shoulder seasons are getting longer — and more popular
Travelers shouldn't necessarily skip dream destinations entirely because they are hotter — but the best time of year to go is shifting. With hotter summers come warmer springs and falls, meaning the shoulder seasons are virtually an extended summer.
Thanks to the rise of remote work, many people can travel whenever they want and simultaneously avoid the heat.
Airlines are also adapting to these changing habits. In September and October 2024, Delta Air Lines, United Airlines and American Airlines flew a collective 12.7% more seats to Europe from the U.S. than they did during those same months in 2019, before the coronavirus pandemic, according to data from aviation analytics company Cirium. Those numbers are even higher when looking at specific southern Europe countries like Italy (over 50%) and Portugal (nearly 60%) this fall.
Just note that these extended shoulder seasons may not always mean avoiding crowds like they used to since more people are turning to these “offseasons” for cooler temps.
For travelers who can only vacation while kids are out of school, it's best to look north to avoid melting next summer.
12.7%
More seats
flown to Europe
on Delta, United and American collectively
Over 50%
to Italy
Nearly 60%
to Portugal
In 2025, travelers can look forward to taking advantage of the additional availability — whether it's flights, cruises or hotels — throughout the extended shoulder season.
A renewed focus on government regulations will affect the future of the travel industry
Changing travel styles, demographic shifts and a general fed-up feeling around “junk fees” combine to make the travel horizon — dare we say — quite a bit brighter from a consumer standpoint. But there are also potential dark clouds ahead with the increased regulation in some parts of the industry.
In recent years, U.S. travelers have grumbled that the glory days of travel seem far in the past, as they face charges for everything from sitting together on an airplane to surprise “resort fees” at hotels. Years of travel industry megamergers, whether of airlines or hotels, have loyalty members grumbling they no longer get the customer service or sky-high perks once associated with their devotion to a particular carrier or hospitality brand.
But Washington has entered the chat.
U.S. President Joe Biden first lambasted resort fees in his 2023 State of the Union address and the U.S. Department of Justice has weighed in on everything from merger attempts to loyalty program devaluations.
The U.S. Department of Transportation unfurled new rules in 2024 around airline refunds for severely altered service or canceled flights — and forced airlines to issue those refunds in cash instead of vouchers tethered to the specific carrier. And the administration has upped the ante in terms of alerting travelers of their rights to a cash refund on everything from a ticket to inflight Wi-Fi if the airline isn't living up to expectations in terms of severe delays or cancellations, delayed baggage return, or broken inflight entertainment.
xpect more consumer-friendly moves, both at the nudging of Washington and from generational shifts in travel patterns.
The government also launched an investigation into the devaluation of frequent flyer programs of the major U.S. airlines in 2024, and the Senate has introduced the Protect Your Points Act that could require additional transparency from U.S. airlines. The pressure from Capitol Hill arrived after travelers endured cratering award redemption rates on air travel and after bigger-than-ever airlines continued to change the qualification playbook on elite status — much to the ire of loyal customers. But expect more than government probes to force consumer-friendly moves on the loyalty front at hotels and airlines.
Federal legislation on the table
PASSED
Resort fee disclosures
Passed via attorney general settlement
Cash refunds for severely affected flights/flight services
PROPOSED
No charges for families to sit together
Credit Card Competition Act
Protect Your Points Act
Government pressure and threat of travelers peeling away from the loyalty program status quo can force positive, customer-friendly changes at major travel companies.
Not all proposed regulation is a win for consumers
In fact, some pose a threat to one of the most popular aspects of today's travel ecosystem: points and miles.
The Credit Card Competition Act, which TPG stands firmly against, is proposed federal legislation that aims to lower the “swipe fees” merchants pay when customers use a credit card. But similar legislation in the past geared toward debit cards had collateral damage: eliminating many perks and benefits previously associated with checking accounts, like no monthly fees.
The CCCA, if passed, could have a similar effect on credit cards and result in banks severely scaling back rewards programs associated with cards — showing not all government oversight means positive changes for travelers.
Visit protectyourpoints.com to learn more.
Younger generations are likely to force their own changes
The government isn't the only force that could shift the industry.
Millennial and Gen Z travelers are significantly less motivated by loyalty memberships than Gen X and baby boomers, according to a Deloitte travel report released this year. Coupled with the reduction in corporate travel that fueled much elite tier-climbing in the past, travel companies must recalibrate and find a way to keep members active and interested — or risk presenting more opportunities for the next generation of travel industry disruptors a la Airbnb to emerge and woo away longtime customers.
This can be a big win for travelers.
Travel companies are increasingly acknowledging demographic shifts are afoot in how people travel and earn status by offering loyalty members more than free night redemptions at hotels or premium-cabin airline award redemptions — and by offering similar creativity in how to earn points and miles. One-of-a-kind experiences are increasingly popular options for loyalty programs to offer more choices for members to utilize points earned.
% who say loyalty program 'very important' to supplier selection (2023)
Marriott has offered ways for loyalty members to use points to see Taylor Swift's concerts. Delta Air Lines allows SkyMiles members to earn miles at Starbucks or when hailing a Lyft after members link their accounts. Other programs are also looking at ways to appeal to consumers.
As we look ahead to 2025, travelers should remember that they have the power to spark industry change through their travel and spending choices.