This year, everyone is saving money on holiday in the UK – except for the rich

River and stone buildings at Dean Village, Edinburgh, Lothian, Scotland, UK - Joana Kruse / Alamy Stock Photo

River and stone buildings at Dean Village, Edinburgh, Lothian, Scotland, UK – Joana Kruse / Alamy Stock Image

During the pandemic, we’ve all discovered how great Britain is: parks within easy reach, beaches a short drive away, remote corners we didn’t know existed. Still, when everything reopened in 2022, millions of us rushed to reserve some much-needed summer sun elsewhere.

So what awaits us in 2023? The cost of living crisis and last year’s travel chaos appear to have made some Britons want to stay home again. In January, 70 per cent of people interviewed by national sentiment tracker VisitBritain revealed they were planning a UK holiday in the coming months.

“I’m definitely sensing a new optimism about British holidays, which is reflected in the number of new bookings we’re currently receiving,” says Harry Cragoe, owner of The Gallivant boutique hotel in Camber, East Sussex. “I recently traveled abroad and the queues are not getting any shorter. It’s more expensive than I could ever imagine.”

Long queues at Heathrow Airport in 2022 - REUTERS/Henry Nicholls

Long queues at Heathrow Airport in 2022 – REUTERS/Henry Nicholls

Airport chaos last summer was no good publicity for overseas travel and it seems to have had a lasting impact on the British psyche: 40 per cent of VisitBritain respondents said queues and flight cancellations would make them think twice. Meanwhile, the UK tour is seen as a means of controlling costs at a time when spending is on the rise. “If you look at what happened during the last recession, people tended to stay at home rather than go abroad,” confirms Patricia Yates, Director General of VisitBritain.

However, it remains to be seen what this UK holiday will look like in 2023. After inflation hit a 41-year high last year, consumer confidence plummeted as the cost of living crisis took its toll. Nearly a quarter of people in the VisitBritain report said they had been “hit hard”. Cutting down on day trips, meals out and visits to expensive attractions is seen as a valuable cost-cutting exercise, with a third of those surveyed expressing an intention to stay in less expensive accommodation.

“We’re already seeing people degrade,” says Yates. “If they go on vacation, they spend less. If they go to attractions, they don’t get a full afternoon tea.”

Hotel, motel… or maybe a friend’s house?

black travelodge hotel in London - Alamy Stock Photo

black travelodge hotel in London – Alamy Stock Photo

With consumers looking to save money, it’s no surprise that global demand for 3-star hotels is up 20 percent, according to Hotels.com. Mid-range in terms of both price and offer are perceived by consumers as a safe choice, which may explain why chains such as Travelodge are thriving. More recently, the brand has begun opening more outlets on the outskirts of cities, where it can keep room rates low and where costly extras like parking are less of an issue.

Aware of the growing number of younger midweek visitors taking advantage of more flexible working arrangements, Cragoe has also made some concessions on the cost of living in the crisis. “We’re definitely seeing more people with laptops, and we’re encouraging that.

“I have a 26-year-old daughter and that age, around 20, is probably the most affected. They are at the beginning of their careers. They don’t have much disposable income. That’s why I launched the “30 Under 30″ offer last year. The idea is that if you’re under 30, you can stay Sunday or Monday night for 30 percent off.” Soon, the hotel will also offer simpler, cheaper meals (“one-plate dishes that have no remorse. You can eat them without worrying about spending too much”).

Airbnb iPhone app - Alamy Stock Photo

Airbnb iPhone app – Alamy Stock Photo

While business is booming at The Gallivant, other types of accommodation seem to be falling out of favour. Far fewer people are planning to live in a rented home than a year ago, according to VisitBritain, indicating that the UK Airbnb bubble may have burst. One factor is the increase in people wanting to save money by staying with friends and family, but there may be other reasons as well.

“Airbnb has been a hit from the start. People rented quite nice places very cheaply,” says Chris Tate, head of hotel and accommodation at RSM, an audit, tax and consulting firm. “But there’s no guarantee what you’ll get until you get there. Meanwhile, for hotels or holiday parks, the comfort factor is being able to visit Tripadvisor or social media and find the information you need.”

Stays for the super-rich

Knightsbridge porter outside the entrance to the five-star luxury Mandarin Oriental Hotel Hyde Park London England UK - Alamy Stock Image

Knightsbridge porter outside the entrance to the five-star luxury Mandarin Oriental Hotel Hyde Park London England UK – Alamy Stock Image

Of course, for those who are rich enough, the holiday will continue as usual. To keep these people in the UK, some establishments and operators have upped the ante, ditching curtains and a DIY attitude in favor of luxurious Bali or Ibiza-like interiors and full concierge service.

Among the new wave of self-catering properties is the Terrarium in Bosham, Sussex, a truly impressive mansion that is one of Unique Homestays’ most scrolled luxury self-catering options. Inspired by Thai spas and surrounded by a natural swimming pool surrounded by elegant sun loungers, it looks like an elegant hotel and can be booked with accompanying massages and private catering.

Meanwhile, the Mandarin Oriental luxury hotel chain also offers private stays in quasi-mansions with their own chefs and helipads. “Luxury must take care of guests. It has to be about personal experience,” says Yates. “I think we’re getting better at it.”

Destinations

Skyline and waterfront, Liverpool, England - Paul Thompson Images / Alamy Stock Photo

Skyline and waterfront, Liverpool, England – Paul Thompson Images / Alamy Stock Photo

While the super-rich visit the piles of other people’s countries, there is more uncertainty about where the rest of us will go. A study by VisitBritain found that fewer people expect to come to London in the first quarter of 2023 than last year, possibly due to cost.

However, another British city is predicted to fare better: Edinburgh was listed by Expedia as one of the fastest-growing destinations in 2023. Meanwhile, Eurovision will be a big boost for Liverpool after its much publicized loss of UNESCO status.

“It fits the story of British music,” says Yates. And in what could be a blessing for wider northern tourism, “Liverpool won’t have enough accommodation so people will have to travel.”

According to PWC, however, regional tourism is expected to weaken somewhat after a strong year 2022. However, some destinations will break this trend: Yates, for example, mentions increased interest in the Peak District. There is another consistently popular region that is projected to continue to grow in 2023. Despite much publicized tourism, the South West continues to be the region most British holidaymakers hope to visit.

Will we pay more?

Rising running costs have so far been largely covered by hotels, but may need to be passed on to consumers in the future. “Hotels have really struggled to regain staff for several reasons after the pandemic, so wages in this sector have increased quite significantly,” says Tate. “But it’s not just salaries, it’s everything else. Hotels had the advantage of using long-term fixed energy tariffs, and now they are coming to an end.”

Guests checking in at the hotel desk - Mark Waugh / Alamy Stock Photo

Guests checking in at the hotel desk – Mark Waugh / Alamy Stock Photo

If hotels want to protect guests from rising costs, visitors may notice slight changes in their experience. One of PWC’s suggestions is that they slightly lower the room temperature by a “barely noticeable” level to save on energy bills. Meanwhile, “some hotels are reducing the frequency of housekeeping visits for multi-night stays, or are choosing to accommodate them,” a company spokesperson said.

Where are you planning to travel this year? Tell us in the comments section below

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