92% of Americans say they will travel in 2021: Priceline CEO

Priceline CEO Brett Keller, joins Yahoo Finance to discuss the state of the travel industry amid the pandemic recovery.

Video Transcript

ALEXIS CHIRSTOFOROUS: The travel industry is roaring back to life as more people get vaccinated and feel comfortable with getting on airplanes and staying in hotels. Joining me now to talk about the state of the travel industry is Priceline CEO Brett Keller. Brett, always good to see you. So you have your finger on the pulse there at priceline.com. Tell us what you are seeing. Has travel demand returned to pre-pandemic levels yet?

BRETT KELLER: Hi, Alexis, thank you for having me. Yes, leisure travel in the US is running on all cylinders right now. You know, I think the stimulus checks and the shifting consumer priorities from more commodities and in-home entertainment to experiences, people just want to get out of their house. They want to travel. They want to see family, friends. They want to go to events. And so this is driving a very strong rebound at the moment.

We recently put out a report really surveying customers on what they're doing and how often they're traveling. 92% of Americans say they will travel in 2021. A lot of that happened really over the 4th of July as well. Consumers are staying longer when they do travel. And certainly, flex travel or flex work is prompting that trend.

And they're going to very warm destinations to just get outside-- Miami, Honolulu, Cancun. Those types of destinations that are easy to travel to, that have really great value, are very popular right now. And so we're seeing a very dramatic rise in travel here in the domestic US market.

ALEXIS CHIRSTOFOROUS: Where can folks still get some of the best deals? Because, you know, we keep hearing about higher prices. And I think it's a myth to think that airfares and hotels are higher than they were pre-pandemic. Tell us what the truth is there.

BRETT KELLER: Sure, right. Let's start with flights. So flights are still trailing prices that we saw in 2019. But they're getting up there, and they're getting close, maybe 5% to 10% trailing at this point, as we move into July. Hotel, on the other hand, has essentially reached levels we've seen in 2019, especially in the very popular destinations, so some of those beach destinations I just mentioned a few minutes ago.

There's still really nice value, though, to find in markets like Las Vegas, which is the number one most popular destination, Orlando. And some of the big cities are starting to come back. People thought that, you know, perhaps big city travel was a thing of the past. It's already starting to funnel back in. And so there's still great value in markets like New York, like Denver, like Nashville. So really good deals happening there because they really haven't filled up yet. But the trend is starting at this point.

ALEXIS CHIRSTOFOROUS: OK, so we talked about airfares, talked about hotels a little bit. What about the cruiselines which we know are just itching to get back to pre-pandemic levels? We got some good news out of Canada saying that the big cruiselines will be able to leave port from there come November. But what are you seeing in terms of consumer demand and appetite for taking to the high seas again?

BRETT KELLER: Yeah, you know, cruises is really in its infancy right now. They're just beginning to open up cruises. And what we're seeing is people are booking for far out dates. So most folks are currently shopping and booking into 2022, so giving themselves plenty of time to plan, allow things to settle in, and give them a chance to really look for next year in terms of their cruise needs.

But the demand is there, and I think as the cruise lines continue to open up and make this readily available, we'll see folks flowing back in at a really healthy pace. You know, cruises always been a great value for consumers. And I think we'll still find that moving forward.

ALEXIS CHIRSTOFOROUS: Now, Brett, disturbingly and upsettingly, there's a rise of COVID-19 cases in many pockets of the country, mostly among the unvaccinated. But this is what we're experiencing now-- higher death rates, higher hospitalizations. Are you seeing that start to play out in activity on priceline.com? Or maybe it's a little too early. But do you see it sort of trending the way the virus goes, so too go, you know, people's interest in wanting to travel?

BRETT KELLER: Sure, you know, it's not surprising that we're seeing some fluctuations with case loads. But what's happened in the past-- and just going back six or seven months here-- is, people are becoming used to this, right? They're used to traveling in this type of an environment. They're taking certain precautions and doing things to protect themselves. And I think consumers are getting used to this pattern.

So even though we're starting to see some bumps here and there in several markets, I'm not concerned at this point that that's going to create a heavy downward pressure on, again, domestic leisure travel. Obviously, international travel is very light right now. And certainly business travel is really depressed. And we don't expect that to return here for another year or two. But leisure will likely continue at a pretty healthy pace here in the US.

ALEXIS CHIRSTOFOROUS: Are you seeing high demand for folks to leave the US and to travel internationally right now?

BRETT KELLER: Yes, we're certainly seeing a rise in searches to destinations in Europe, right? Europe in particular is a great place to visit at any time of the year, but specifically, in many of the countries that have started to open up, so countries like Denmark and Finland, France, Germany.

We're seeing searches-- I'd say the booking flow is just starting to happen. But that's going to take some time as consumers get used to the various things that they have to do to prepare themselves to travel into these markets. But most travel is currently happening domestic US or just outside, whether that's in Puerto Rico, Cancun, those types of markets.

ALEXIS CHIRSTOFOROUS: Mm-hmm. I want to quickly touch on something Priceline has been doing for the past few years now, sort of quietly behind the scenes. And that is working with the Department of Defense to support American forces travel, a leisure travel site exclusively for the military community. Tell us a little bit about your efforts there.

BRETT KELLER: Sure, we partnered with the Department of Defense about three years ago. And we came up with this concept of building a leisure site that would serve the armed forces community. And when it first launched, it was open to all active military personnel and members of the Department of Defense. Just within the last week, though, we've opened that up more broadly to include all veterans.

This site is built specifically for these people. They have to have credentials to enter the site. But once they enter, they will find a broad range of travel discounts across all of the biggest names in travel. This is something that our team is really excited, very proud about, serving this community. And we now have this open to over 22 million members of the armed forces. And we're just very pleased to participate in this.

ALEXIS CHIRSTOFOROUS: Yeah, great work you're doing there for our armed forces for sure.

BRETT KELLER: Thank you.

ALEXIS CHIRSTOFOROUS: Brett Keller, CEO of Priceline, thanks. Have a great weekend.