Travel without the budget

April 20, 2011

Backpackers were once happy to slum down in derelict dormitories. Now, to the delight of hoteliers, they demand “flashpacker” accommodation with iPod docks and hygienic loos during their designer-shoe-string travels around Australia or South-East Asia.

New research from American Express (1) this week suggests that the mass-market now also prefer added frills. The survey found that 83 percent of British holidaymakers are willing to pay as much as 20 percent extra for holiday upgrades. This is quite a leap from five-year figures to date, which show that only 39 percent of travellers paid to upgrade.

The researchers are unclear whether travellers have simply had enough of low-cost carriers’ lack of tri-course meals – or leg room – or feel more confident about spending money.

Some travellers, of course, try to secure added extras for free, dressing smartly, fluttering their eyelashes at officials… but only six percent of travellers questioned said they managed to secure a coveted complimentary upgrade to their travel plans.

Of those willing to pay for an upgrade, the majority (63 percent) said that they would be willing to pay up to 20 percent more on top of the cost of the holiday, while one in five travellers would be willing to pay in excess of 20 percent extra.

A 20 percent upgrade isn’t exactly a splurge – but it reflects travellers’ distaste of steerage treatment when on a well-deserved break. British holidaymakers are a well-travelled bunch and know just what aspects of the journey can be jollied up a bit.

Julie Hay, American Express’ Vice President Cards, agrees: “While people continue to look for holidays that offer value for money,” she says, “increasingly travellers now aspire to a more comfortable and luxurious holidaying experience.”

Hay and her employers will be hoping to capitalise on this trend with their new British Airways American Express Premium Plus card, which is treating cardholders to 18,000 bonus BA Miles when they spend £3,000 or more in the first three months of membership (3,000 miles when £500 or more is spent in the same time period for the non-Premium version).

The AMEX findings are juxtaposed by another piece of recent research. Low-cost carriers (LCC) were put under the spotlight by Kelkoo (2), a travel and shopping comparison website. Their figures show that LCCs now add as much as 44 percent (37% on average) in extras to the price of a ticket. This could be fees for check-in baggage, for seat assignment and, most aggravatingly, paying for online bookings with a debit or credit card.

It doesn’t come as a huge surprise to find that of all the budget airlines in the survey, Ryanair levied the greatest proportion of extra charges on to its basic fares, with standard travellers spending 40% on top of the original cost of the ticket, at an average cost of €32.

LCCs still offer an average saving of one-third over traditional carriers, and are much better value on international flights (-41%) than domestic flights (-20%) when compared to traditional airlines, but this does rather beg the question: just how bare is bare-minimum comfort on an aeroplane?

As more airlines understand the terms of a basic ticket to be passage on a random seat in a luggage-lite, refreshment-free environment, the more extras even mildly discerning travellers will want to pay.

Rather than aspiring to travel in a more frills-laden style, passengers find themselves swimming against the current, shelling out for things that not so long ago were inclusive with a bog-standard ticket.

[1] Research was conducted by One Poll, 1,005 UK adults aged 18+ who have travelled abroad in the last 12 months were surveyed between 29 March and 31 March, 2011

[2] Kelkoo’s “European Flight Index”, produced by flight analysts RDC Aviation, charted the cost of 5,000 fares on 118 routes, from 20 low-cost and conventional airlines at 192 airports. All airfares were collected for a ‘standard passenger’ – a single adult, travelling on a return flight, on a six-night stay, paying by Visa, checking-in online, using a fast bag drop option for a single bag

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