One of the headline stories in the sector this year has been the launch of sub-£200 travel from Britain to the US by Norwegian Air Shuttle.  Other airlines will have to react to this, and it will be interesting to see whether it trumps the BA approach of trying to behave like both a premium and a budget airline.

Norwegian’s strategy fits with long-term changes that can be seen in holiday patterns.  They are seeking to profit from two trends.  First, the substantial rise in people taking two or more holidays per year – this is now 48% of us, with 11% taking six or more.  Second, the flexing of the ‘grey wallet’.  More and more retirees have money to spend on travel, and Norwegian’s more expensive premium class may be ideal for today’s older multi-holiday traveller.

Norwegian are not the first airline to target cross-Atlantic travellers with a budget proposition.  In 1977 Laker Airways, owned by the entrepreneur Freddie Laker, launched the ‘Skytrain’.  It met with early success, but the major carriers reacted and its flights ceased in 1982 when Laker Airways went bankrupt.  Skytrain’s sole focus on discount travellers may have contributed to its problems.

So what has changed?  Why do Norwegian see an opportunity?  Long-term trend analysis of TGI data, including the historical data held within the Archive for Market and Social Research (AMSR), illustrates how consumer travel behaviours have evolved since the days of the Laker Skytrain, and why Norwegian have made their move.

In fact, the percentage of the GB population that takes holidays hasn’t changed.  The 63% reported by TGI when Skytrain launched in 1977 remains at 61% today.  But back in 1977 only 15% of adults took holidays abroad.  This doubled to 30% within 10 years, reflecting the 1980s focus on leisure and pleasure, although with the revival of the ‘staycation’ it hasn’t grown greatly since – only to 34% in 2016 TGI.

Even more relevant for Norwegian – and indeed BA and the other carriers – is the growth in the numbers taking multiple holidays or short breaks during a year.  From 23% at Skytrain’s launch in 1977 this has grown to 48% today.

Indeed, in 2016 TGI reports 11% of the population as taking 6 or more holidays or breaks per year.  46% of these frequent travellers are aged 55+, and 38% are ABs: surely music to Norwegian ears.

Research is vital for businesses taking decisions.  When these are large-scale decisions such as those taken by airlines, understanding long-term trends can be crucial.  The market movements support Norwegian’s strategy, and in the affluent greys there’s a particularly interesting consumer group that they might choose to target.