Closer destinations preferred for beach travel, but more remote sites gaining ground

December 20, 2018 - As the countdown to 2019 approaches, beach vacations, especially in the Americas, rise to the top of global travelers' minds. During the winter season, beach travel is especially popular among North Americans-accounting for nearly half of their total cross-border travel between January and March.

But where to go this winter season? For insight into potential hot spots, the Visa International Travel (VISIT) platform has identified the latest top-trending beach destinations. Travel close to home is preferred by most travelers. In North America, three-quarters of all travelers are taking short trips (within 3,000 miles or five hours of flight time). The Caribbean is a top draw, with sites in the Bahamas and Jamaica ranking at the top of the VISIT trending list (see Page 3 for complete list). The region has mostly recovered from the devastating hurricanes of 2017 and is open for business. However, some parts of the Caribbean are still feeling the economic impact as beach travel continues to be displaced (Page 4). At least 18 percent of visitors who would have gone to the impacted islands this year went elsewhere in the Caribbean, according to analysis from Visa Business and Economic Insights.

Highlights of this report:

• More and more travelers set sights on distant locales
• Top-trending beach destinations
• Caribbean travel rebounds after hurricanes
• Mexico also strongly benefitted from diverted North American travel

More and more travelers set sights on distant locales

Travelers from all corners of the world predominantly choose quick, short-haul* trips for their beach time. Across seven representative countries (U.S., Canada, U.K. Germany, Russia, China, Argentina), four out of five beach trips were within 3,000 miles from home. The distribution by the share of travelers venturing within that distance varies somewhat by market, ranging from China and Argentina at the lower end (with about 60 percent of travelers), to Germany, Canada and the U.K., where more than 80 percent of travelers journey 3,000 miles or less to their preferred beach destinations. Within the 3,000 mile range, North Americans typically opt for Mexico and the Caribbean (adding Florida and California into the mix for Canadian tourists), while the Chinese flock to Thailand and Russians favor Turkey. British tourists can choose from Spanish, Portuguese and Moroccan seaside destinations that are all within a 2,000-mile range. Similarly, Argentine travelers benefit from their country's close proximity to some of the famed beaches of the South Atlantic in Uruguay and Brazil.

However, with improved travel and routing options, more and more travelers are flying further than before to enjoy distant beaches. Growth in long-haul travel-at 8 percent YoY (September 2018)-has been consistently higher than short-haul travel (6 percent YoY growth in September) since before 2016.

As this trend picks up, travelers are extending their sights: Argentinians to Greece and the Chinese to Morocco, for example, while places along the Italian coast, such as Capri and Sorrento, have become big draws for U.S. and Canadian tourists, according to VISIT's list of top-trending destinations.

Trending beach destinations for top 10 source markets, 3Q2018 (Ranked by number of arrivals from origin country of traveler)

Caribbean travel rebounds after hurricanes

The seasonal nature of North American travel leaves the tourism industry in the Caribbean and Mexico exposed to the risk of hurricanes as most travel occurs soon after the peak North Atlantic hurricane season (June 1 - November 30). ¹This vulnerability became abundantly obvious when Hurricanes Irma and Maria devastated the Caribbean last year right before the start of what was promising to be a good winter travel season. Islands that were in the direct path of those deadly hurricanes  (including Puerto Rico and the Virgin Islands) typically account for a third of all arrivals from N. America to the region. Visitor counts to these islands dropped nearly 50 percent relative to the previous year following the hurricanes.

The good news is that N. American travel to the Caribbean has mostly recovered to its pre-hurricane levels, partly due to rebuilding but also because less impacted islands nearby attracted some of the displaced North American traveler flows. However, North American travel to the Caribbean would have been even higher than what it was given the strong economic fundamentals in both the U.S. and Canada (here referred to as the "no hurricane scenario"), according to Visa Business and Economic Insights estimates.

North American arrivals to the Caribbean (YoY growth rate)

Underscoring the devastating impact of the hurricanes on Caribbean travel, the analysis shows that the Caribbean received an estimated 1.3 million fewer arrivals from North America in the 12 months following the hurricanes relative to the no hurricane scenario (an estimated decline of about 11 percent of total arrivals). The data suggests that about one out of five displaced vacationers to the Caribbean traveled to nearby islands in the region instead. With this displacement, the Bahamas, Cayman Islands and Jamaica became the most popular destinations in the region for North American travelers who would have normally vacationed in the hurricane-impacted islands over the past year.

Mexico also strongly benefitted from diverted North American travel

Canadian travel (arrivals) to the Atlantic Coast of Mexico, for example, increased about 11 percent relative to levels predicted over the last 12 months, particularly during the peak winter travel months following the hurricane season last year. Popular destinations on the eastern shore of the Yucatán Peninsula, such as Playa del Carmen, likely picked up most of the growth.