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Marcus Johnson: Hey, gang. It's Thursday, June 18th. Jenny, Zak, and listeners, welcome in to Behind the Numbers, an EMARKETER podcast made possible by Rokt. I'm Marcus, and joining me for today's conversation we have, living in New York, head of research, it's Jennifer Pearson.

Jennifer Pearson: Hi. Thanks for having me.

Marcus Johnson: Of course, Jenny. Thank you for being here.

Marcus Johnson: Based in the Chicago area, not Evanston, principal analyst Zak Stambor.

Zak Stambor: Hey, Marcus. Hey, Jenny.

Marcus Johnson: Hey, fella. Uh, welcome to the show. We start, of course, with the fact of the day

Marcus Johnson: Where [00:01:00] are America's most popular cities for overseas tourists? Any guesses? Most popular city to visit

Zak Stambor: I would think it would have to be New York.

Jennifer Pearson: New

Marcus Johnson: York. It

Jennifer Pearson: is. Yeah.

Marcus Johnson: Nine and a half million overseas visitors in 2024, uh, accord- uh, accounting for one quarter of... 'Cause one traveler could visit multiple places, but it accounts for one quarter of all overseas travelers.

Marcus Johnson: Um, so if you're coming to America, there's a one in four chance that they're going or will at some point go to New York. That's according to the International Trade Administration's National Travel and Tourism Office. Uh, any others in the top 10 that you guys... Give you one guess each. Try and get high as you can in the top 10 for another city visited by overseas people.

Jennifer Pearson: DC? DC- Is it

Marcus Johnson: in the

Jennifer Pearson: top 10? ...

Marcus Johnson: is, uh, seventh.

Zak Stambor: I

Marcus Johnson: would

Zak Stambor: guess- Wait, [00:02:00] oh, I was gonna guess what number it was going to be.

Marcus Johnson: Oh, sorry, yeah. Wow. DC. What were you gonna guess? What were you thinking? Do you think it was

Zak Stambor: higher than seven? I was going to say five.

Marcus Johnson: Okay. Yeah.

Zak Stambor: Yeah.

Marcus Johnson: Seventh, seventh place.

Zak Stambor: Um, I will guess San Francisco.

Marcus Johnson: Oh, he's just beat you, Jenny, at six. Yeah.

Jennifer Pearson: Okay. San

Marcus Johnson: Francisco, sixth. Yeah. Uh, well played. So LA- uh, no, sorry, Miami is ranked second- Oh, wow ... with, uh, five million visitors. Hmm. That is half as many as New York. Hmm. Uh, it's in second place. LA is next with just over four million. Orlando, uh, obviously Disney- Oh

Marcus Johnson: with just under four million. Then it goes Vegas, San Francisco, DC, Honolulu, Boston, and Chicago, yes, rounds out the top 10.

Zak Stambor: Hmm.

Marcus Johnson: Anyway-

Zak Stambor: Right ...

Marcus Johnson: today's world topic: What travel will look like for Americans this summer?

Marcus Johnson: The great travel meltdown of 2026. Airports are suffering a [00:03:00] perfect storm of actual problems and passenger anxieties, writes Kaitlyn Tiffany of The Atlantic. She says the meltdown started taking shape at the end of February. First, the US war against Iran forced the cancellation of re- or rerouting o- o- of many, uh, flights to the Middle East.

Marcus Johnson: Then the blockage of the Strait of Hormuz drove up the price of jet fuel and threatened to cause crisis, uh, for major airlines. Uh, next up, large numbers of TSA workers started staying home after a protracted budget fight in Congress left them working without pay for weeks. Uh, Zak, I'll start with you for this one.

Marcus Johnson: Given this backdrop, what stat to you best exemplifies what Americans' summer travel will look like this year?

Zak Stambor: One in three travelers say rising costs will make them travel less this summer according to a Points Guy survey.

Marcus Johnson: Mm.

Zak Stambor: And no matter how you cut it, travel is getting more expensive. Yes. Gas prices were up 40.5% year over year in May.

Zak Stambor: Airfares- Mm ... were up [00:04:00] 26.7% year over year. And lodging away from home, which is the broad category that includes hotels and motels and vacation stays and some other stuff, was up 5.1%. So everything is not just getting more expensive, but a lot more expensive.

Marcus Johnson: Yeah.

Zak Stambor: And so it's just really hard for people to afford to get away.

Marcus Johnson: Yeah.

Jennifer Pearson: Yeah.

Marcus Johnson: Um, Jenny, please.

Jennifer Pearson: I was gonna say, uh, we also have a survey s- from, from Points Guy also, same, same report where, uh, folks are spending more or plan to spend more, intend to spend more. But really it's because of the cost of travel. Mm. It's not because they're, you know- Spend more because they have to

Jennifer Pearson: splurging. Exactly. Um, yeah.

Marcus Johnson: Yes. Um, consumer sentiment, uh, things are more expensive. Uh, and so consumer sentiment unsurprisingly fell, uh, in May. But to an all-time low, that might be the surprising part. [00:05:00] Record low according to the University of Michigan's, uh, monthly survey. Um, they are, Jenny, to what you were saying, they are spending more because they have to.

Marcus Johnson: But travelers are, it seems, more likely to... They still do want to travel. It's not like the appetite has, has waned. They still want to. Um, they're just more likely to adjust budgets and trade down than give up vacations. So my stat was, um, well a couple here, but they're centered around this idea of traveling, but traveling differently and more affordably.

Marcus Johnson: 38% opting for cheaper alternatives where possible. Uh, close to 70% staying stateside. According to KPMG, the share of people with international travel plans falling from 28%, uh, last year to 21% this year. Um, and as you can see from the chart on the screen with the data from TakeUp, travelers are less likely to increase spending in the nice to have areas, trip length, upgrades, peak travel.

Marcus Johnson: Uh, and so they are just, um, [00:06:00] traveling, um, cheaper and, and adjusting plans accordingly. Zak, I really liked this, um- Uh, quote that you had i- in one of your pieces. You, you were basically explaining this travel, it was supposed to be a banner year for travel this year, right? You were saying the World Cup, um, America's 250th birthday.

Marcus Johnson: Route 66 I didn't realize was 100 years old. Yeah. And you said there was supposed to be a major tailwind. Not so much.

Zak Stambor: So yeah, it was supposed to be a banner year for travel. There were all of these, uh, events that should lead to a surge in demand. The World Cup in particular was so, is, was supposed to lead to a surge in international travel.

Zak Stambor: Yeah. But with costs rising, with the political climate shifting, um, and with other alternatives, the World Cup, you know, you can go to Canada, you can go to Mexico in addition to the United States.

Marcus Johnson: Yep.

Zak Stambor: People are just choosing not to go.

Marcus Johnson: Um, [00:07:00] it's particularly interesting as well, Zak, 'cause you, you'd reminded me that, um, foreign tourism to the US was down last year.

Marcus Johnson: Uh, so over 5% it fell. Um, e- and even, even as global tourism grew 4% according to UN Tourism. So, uh, it was supposed to be a bounce back year because of that drop, and you had all these events. However, the, the backdrop has really dampened people's appetite for traveling, um, despite what was expected. Um, Jenny, what, what's your, uh, stat that best exemplifies how Americans feel about traveling this summer?

Jennifer Pearson: Yeah, sure. I'll share a ch- a chart from Deloitte, uh, which was a survey from, uh, April for what, uh, adults plan to do, US adults, during their summer vacation. And they tracked this, they asked the same question year over year, uh, tracking it over time. Mm. 50%, uh, said they plan to take a summer vacation.

Jennifer Pearson: That's down from a high of 63% in 2023, [00:08:00] and has been trending downward, but is- Wow ... um, the lowest in the past four years for those planning to take a summer vacation.

Marcus Johnson: Wow. You'd think it'd be going the other way after the pandemic.

Jennifer Pearson: Yeah. Right. It did rise after the pandemic, but it- Okay ... has now, yes, I think cost and for all the, uh, what we just discussed is, uh, pe- people are staying local and not- Yeah

Jennifer Pearson: making as many plans. It's just too expensive.

Marcus Johnson: Yeah.

Zak Stambor: Yeah, I think that's right. I think it's like people haven't lost the desire to travel. They wanna travel. Um, half of people, I mean, you see it in any number of surveys, it's roughly the same number. Points Guy, I think it was 48%. Mm-hmm. But, and there's several other surveys that roughly align.

Zak Stambor: But- You know, when the, when you're filling up the tank and that's eating up a large share of your budget, and other everyday expenses are also getting more expensive, you have to cut costs somewhere.

Marcus Johnson: Yeah.

Zak Stambor: And so discretionary spending, like travel- Mm-hmm ... is just one place to [00:09:00] cut.

Marcus Johnson: Yeah. Jenny, for the Americans who are still, uh, looking to travel, where are they most likely to go online to plan that travel?

Jennifer Pearson: So search engines really do just lead in, in, uh, tools to use for booking travel, uh, for looking for inspiration, for searching for, uh, destinations and ideas and hotels. Search engines continue to lead. Uh, there- we've obviously had a lot of talk about AI, which I know we'll discuss later, but- Mm ... our search engines.

Jennifer Pearson: And then, and then sites like hotel websites directly, uh, and then travel, travel online travel sites are also top destinations for- Yeah ... travelers.

Marcus Johnson: What's interesting, Zak, is that there's- It is search engines first, at least according to, we have some research. It's from, uh, is it from Ledger?

Jennifer Pearson: Mm-hmm. Jenny?

Jennifer Pearson: Yes. Yeah. And those are, those are people who are intending to travel, so among-

Marcus Johnson: Okay ...

Jennifer Pearson: people who are gonna travel. Yeah.

Marcus Johnson: Okay. Um, but Zak, there's a million [00:10:00] places that people are going, right? That's the reality of it. It's just it's so extremely fragmented. What do you make of how people are, where people are going online to plan travel?

Zak Stambor: Yeah, I think when people are cost-conscious, they wanna shop around, and they wanna shop around for the best price. Mm. And I think a lot of people associate search engines as a neutral arbiter, where they can just get a, a true sense of price- Yeah ... without any thumb on the scale. Yeah. So I think that makes sense.

Zak Stambor: I think people going to hotel websites also makes sense because I think loyalty is a big driver of where people stay. Mm.

Marcus Johnson: Yeah. Um, it's a huge driver. Also, I thought this was really interesting, some data from Criteo, leading factors when comparing travel products, 'cause you're saying about people, um, comparison shopping.

Marcus Johnson: Um, good reviews, 60%, ahead of special offers, free cancellation, uh, refundable services. So reviews mattering more than anything.

Jennifer Pearson: Yeah, we see that time and again in d- different [00:11:00] surveys, uh, from different sources, that reviews are- Okay ... some of the top of what they come into consideration when booking travel.

Marcus Johnson: Yeah. Yeah, I would've thought cost, I mean, cost is probably up there, but I was shocked to see reviews were this high, and this much higher than second place as well. Jenny, when I was doing the research for this episode, I noticed, um, so our forecasting team has some numbers on how many Americans book travel digitally, book travel online.

Marcus Johnson: 57% of Americans will book travel online this year. That seemed low to me. Mm-hmm. What do you make of this, uh, digital travel booker's number?

Jennifer Pearson: Yeah. I'll, I'll give credit to Natalia Ramirez, who on our forecast team worked on this forecast, who noted that, uh, the internet users who are using digital tools to book travel is increasing each year.

Jennifer Pearson: But there are- Mm ... folks who, who are not traveling. A fair share of, uh, the United States adults are not. And, and then those who [00:12:00] are might not necessarily be booking online travel. They might be driving to see a relative and don't need to make travel ar- arrangements, so-

Marcus Johnson: Mm-hmm ...

Jennifer Pearson: that's what explains that 57%.

Marcus Johnson: It's not like 43% are booking offline, it's that a lot of that 43% who aren't digital bookers aren't booking.

Jennifer Pearson: Right.

Marcus Johnson: Um, and to what you were saying before, they might be driving somewhere, and so you don't need to book a plane ticket or something.

Jennifer Pearson: Exactly.

Marcus Johnson: Yep. Um- Well, not having to book a plane ticket. A lot of people, though, it's not just getting to the place, it's finding somewhere to stay.

Marcus Johnson: Where are Americans generally most likely to go online to book accommodation?

Jennifer Pearson: So for hotel and resort bookings, Airbnb leads with, uh, yeah, over 17 million, uh, folks going there, internet users going there- Mm ... uh, to book. And then Marriott and HomeAway and some of the higher, Hilton. Disney World's pr- uh, pretty high up there.

Jennifer Pearson: A lot of, um, travelers- Mm ... are going there. Uh, and then zooming out a little bit just in [00:13:00] digital travel sites, Expedia leads Priceline and Kayak, but Expedia leads by quite a big margin. Almost- Okay ... 40 million users that month.

Marcus Johnson: Okay. Zak, what do you make of- I'm gonna zoom back in on the, the accommodation piece for a second because I, I'm someone who uses Airbnb all the time.

Marcus Johnson: Um, but I didn't, I was shocked to see that it was the number one place that people are, at least as unique visitors, that people are at least going to. You've also got HomeAway in third place with about 10 million. Um, I don't know the data in terms of the exact balance of, you know, where people are booking.

Marcus Johnson: It'd be a good thing to, to, to look into. But what, what's your take on where people are going to book accommodation?

Zak Stambor: I don't think it's that surprising because I think there's such a broad spectrum of inventory on Airbnb-

Marcus Johnson: Mm ...

Zak Stambor: that it offers something for everyone. And as consumers are increasingly taking shorter trips and traveling domestically, and maybe not going to marquee destinations as well, it kinda [00:14:00] fills that niche.

Marcus Johnson: Oh, interesting.

Zak Stambor: Um-

Marcus Johnson: Yeah.

Zak Stambor: So, you know, there are certain places that you can go and there just aren't that many options.

Marcus Johnson: Yeah.

Zak Stambor: And Airbnb is an appealing alternative for a lot of those.

Marcus Johnson: Yeah.

Zak Stambor: Mm.

Marcus Johnson: Yeah, it's a good point. You're not relying on the hotels to be in said city, but there's always gonna be homes there.

Marcus Johnson: Um, let's close up the episode by talking about, um, AI and how that's helping or not helping, uh, maybe uh, consumers book travel. Jenny, I'll start with you. In, in what ways have you seen, um, AI is actually helping, if at all, uh, Americans with their travel plans- Yeah. It's- ... or booking?

Jennifer Pearson: Right. It's helping somewhat.

Jennifer Pearson: I think, uh, it, this is coming from a small number of users who actually are using an AI tool- Mm. Mm ... to, uh, research, definitely research, not necessarily book. We haven't seen a big uptake in transacting with AI. So, uh, consumers are still, travelers are still using search engines [00:15:00] for the bulk of what they're researching.

Jennifer Pearson: But when they do use an AI tool, it's, a lot of it's for inspiration and for that research, the consideration phase, coming up with ideas for restaurants or ideas for activities on the stay, and less so of the find me the cheapest price for, uh- Mm ... you know, where I'm going.

Marcus Johnson: Mm-hmm. Yeah, Zak, we've, we've seen this in retail a lot, um, people using AI for inspiration, uh, to shop around a bit, but not necessarily for the conversion piece.

Marcus Johnson: I thought, um, Grace Harmon, one of our analysts, had a, an, an interesting quote in one of her p- um, articles. Over half, 54%, of US adults would be okay with AI planning a trip from start-to-finish planning according to human security, but only 12% would be comfortable with it booking travel without their final approval even if the assistant stayed within preset preferences and budget.[00:16:00]

Zak Stambor: That makes perfect sense to me. AI is an amazing tool for planning a trip. Yeah, I take a lot of trips to national parks, and there's a lot of logistics involved, and handing over the basic outline of what the trip will be to AI- Mm-hmm ... and, and having it map out the cadence and highlight here's a specific hike to go on, and here's some restaurants you might wanna, that might fit your family's needs.

Marcus Johnson: Mm-hmm.

Zak Stambor: It's amazing for that. But the actual handing over the keys to have it book, that's like an entirely different thing, and I think it's an entirely different thing for a few different reasons. One is part of the joy of travel is the anticipation of travel and, and the searching- Mm-hmm ... and the looking at the photos, and just the getting excited about where it is that you're gonna be, what the [00:17:00] amenities are like, all of that sort of stuff.

Zak Stambor: You kind of lose that when you hand it over to AI. And then the other thing is just, like, the trust issue. Yeah. I, I just think a lot of people- Yeah ... are not ready to let AI handle their transactions. Yeah. They just don't want to. Yeah.

Marcus Johnson: Yeah. Top, top concerns, according to that same source, top concerns about AI trip, uh, planning, expensive mistakes, 46%, lack of human oversight, 36%.

Marcus Johnson: Um, yeah, and to what, Jenny, to what Zak was just saying in terms of, you know, help, um, plan a schedule, um, and, and suggest things to do whilst I'm away. Um, uh, Lisa Haas, senior editor of our tech briefing and the AI briefing as well, had some, um, some numbers showing 42% have used gen AI to create an itinerary.

Marcus Johnson: According to Simon, uh, Kutcher, uh, 31% employed it to search [00:18:00] for flights, hotels, and other bookings. 28% used chatbots on booking sites. Um, so people are experimenting- Mm-hmm ... but we're far, far away from, from booking. Um, we're st- even far away, you could argue, from, um, shopping. They're using it to plan the trip, not necessarily find the, uh, flights or the hotels, um, or, um, the, uh, the car rentals.

Marcus Johnson: They're using it more for inspiration than anything it seems.

Zak Stambor: I think a lot of people are also not that attuned to what it is that the platforms actually offer in terms of- Mm ... handling the transaction. Um- Yeah ... our colleague, Rachel Wolf, just put out a great report looking at how it works within e-commerce, and I think a lot of people are just wholly unfamiliar with the actual logistics of it.

Zak Stambor: And so I actually think, like, those numbers are [00:19:00] inflated from what the reality is.

Marcus Johnson: Mm.

Jennifer Pearson: Jenny,

Marcus Johnson: please.

Jennifer Pearson: Yeah, I think, um, um, a leisure study, uh, were surveying those who have used AI for travel. They also surveyed those who didn't, and they asked why, and privacy, which Zak, you mentioned, but also accuracy, I think is an interesting one.

Jennifer Pearson: Mm. And I think some folks are, are just not, uh, confident that they're gonna get the right results when they're searching with AI.

Marcus Johnson: Yeah. Um, I'll end with this chart I found from, this data from Ledger showing, uh, the features that would improve the guest experience, the AI features that would improve the guest experience, uh, the best.

Marcus Johnson: Uh, and this was, um, yeah, very straightforward things. A smart app that keeps the travel plans, check-in times, local reservations in one place was in first. Uh, helpful suggestions during your stay, like a meal, activity recommendations at the right time was second, uh, or they hit joint first, I should say.

Marcus Johnson: And then you've got quick contactless [00:20:00] check-in, check-out using facial or voice recognition, local tips and activity ideas. Um, all very basic stuff, um, or doing old things in new ways pretty much, um, in terms of how, yeah, people want AI to help at the moment. Still very new. We'll see where it goes. That's all we've got time for for this episode.

Marcus Johnson: Uh, thank you so much to my guests for hanging out with me today. Thank you first to Jenny.

Jennifer Pearson: Thank you so much.

Marcus Johnson: And Zak.

Zak Stambor: Yeah, thanks for having me.

Marcus Johnson: Uh, and of course, thank you to the production crew, uh, Lance and Luigi, and to everyone for listening to my Tourism After Podcast, made possible by Rokt. Please do leave a rating and review if you have a second.

Marcus Johnson: Uh, we'll be back on Monday. Happy Juneteenth weekend to everyone.