ah&la resort conference
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AH&LA Resort Conference. Michael R. Grillo, Vice President American Express Business Insights September 19 th , 2011. Agenda. American Express Business Insights The US Consumer Post Recession The New Normal Lodging Industry Trends, Domestic and International Visitors - PowerPoint PPT PresentationTRANSCRIPT
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Michael R. Grillo, Vice President
American Express Business InsightsSeptember 19th, 2011
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
American Express Business Insights The US Consumer Post Recession The New Normal Lodging Industry Trends, Domestic and International Visitors Key Traveler Segments to Focus on for 2011 and Beyond Final Thoughts and Q&A
Agenda
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
American Express Cardmembers
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
US SPEND TRENDSRecession & Recovery
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
OVERALL SPEND GROWTH
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Pre Recession Recession Recovery
Spend Growth by Card Type
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Dining
THE GREAT RECESSION
Retail
Entertainment
6
YOY Spend Growth by Quarter
Q1 -09 Q2-09 Q3-09 Q4-09Travel
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Dining
THE UNEVEN RECOVERY
Entertainment
YOY Spend Growth by Quarter
7
Retail
Travel Q1 -10 Q2-10 Q3-10 Q4-10
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
THE UNEVEN RECOVERY?
Entertainment
YOY Spend Growth by Quarter
8
Travel Q1 - 2011 Q2-2011
Retail
Dining
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
US CONSUMER BEHAVIORThe New Normal
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
THOUGHTS ABOUT THE NEW NORMAL
Smart and wireless phone and service have increased through the recession
Necessities Are Being Redefined
Spending shifted from dining to supermarkets while affluent consumers shopped more with discount retail
Value Is Sticking
Generations MatterBoomers and Seniors cut back first and haven’t come back as strong while Gen X and Y have returned to spending
Luxury fashion spending returned first but consumers are deal seeking; newcomers are younger and less affluent
Luxury Is Back
Dining Out is ChangingQSR increased its share of restaurant spending by more than 15% and bars have seen greater than 40% increase since the start of the recession
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Affluent consumers and Gen Y have prioritized a healthy lifestyle of fitness, high-quality foods, and caring for oneself since the pre-recession period
Health Matters
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
LODGING INDUSTRY TRENDS
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Lodging Spend has Picked Up and Maintains its Trajectory for the Luxury and Upscale Segments
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Sp
end
ind
exB
ase
Per
iod
: 2
008=
100
Domestic Visitor Spend Index in Lodging
Recession Recovery
Recession Recovery
International Visitor Spend Index in Lodging
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Gen Y Travelers are Leading the Road to Recovery
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Sp
end
ind
exB
ase
Per
iod
: 2
008=
100
Consumer Spend on Lodging
Recession Recovery
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
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TravelRetail Dining
Gen Y, are Growing ALL tiers of the Lodging industry, especially on the high and low ends
H1 2011 YOY Visitor Growth by Lodging Tiers
6%
0%
-4%
-10%
6%
-1%
-4%
-9%
7%
10%
2%
-8%
9%
2%
0%
-4%
LUXURY UPSCALE MIDSCALE ECONOMY
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
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TravelRetail Dining
…..and Spending!
H1 2011 YOY Visitor Growth by Lodging Tiers
3%
14%
2%
-5%
8%
2%
-3%
-7%
40%
43%
30%
9%
22%
6%
3%
-2%
LUXURY UPSCALE MIDSCALE ECONOMY
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Business TravellersBusiness Travellers
Key Leisure SegmentsKey Leisure Segments
Who are the key Traveler Segments to Focus on for 2011?
International VisitorsInternational Visitors
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Sp
end
In
dex
H1
200
7=10
0Business and Visitor Spending observes strong rebound in 2011
Business Leisure
Visitor Domestic
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
% Business vs. Leisure (H1 2011)
+4%
Domestic Business Travellers Remain Valuable
Business Leisure
Spend
-5%
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
% Business vs. Leisure (H1 2011)
+2%
International Travelers For Business Are Also Rebounding
Business Leisure
Spend
-2%
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Top International Feeder Markets
Canada United Kingdom Mexico Australia France
Business17% 19% 11%
Leisure
MAPS to be UPDATED
11%17% 17% 30% 18%
3% 3%
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Top International Feeder Markets
Canada United Kingdom Mexico Australia France
BusinessAmex Overall
LeisureAmex Overall
1% 3% 1.3%
0.9%0.9%0.1%
0.9%0.7%
0.0% 0.0%
MAPS to be UPDATED
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Top International Growth Markets
Australia Brazil Canada Japan France
BusinessAmex Overall
LeisureAmex Overall
22%30% 17% 17% 18%
13%19% 17% 14% 11%
MAPS to be UPDATED
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Newcomers in the Recovery Period Have Gained Share
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Spend Share for All Lodging
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
Younger Consumers (Gen X and Gen Y) Are Becoming More Important
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Spend Share for All Lodging
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
The “Recession Proof” Traveler is Showing Resilience
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CORE RETURNING NEWCOMER RECESSION PROOF
% Leisure/# and Spend 56%/46% 72%/63% 75%/63% 76%/63%
Luxury & Upscale Share of Visitors/Spend
59%/73% 54%/69% 51%/65% 52%/66%
YOY Change in Luxury Spend (H1 2011)
-2% -4% -2% +61%
YOY Change in Upscale Spend (H1 2011) -1% -2% +1% +58%
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
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TravelRetail Dining Entertainment
SPEND BEHAVIORS BY GENERATION
2010 YOY Spend Growth by Industry
15%
8%
4%
2%
0%
-2%
-5%
-6%
0%
-3%
-3%
-6%
4%
4%
1%
-2%
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
29
TravelRetail Dining Entertainment
SPEND BEHAVIORS BY GENERATION
H1 2011 Spend Growth by Industry
6%
2%
-1%
-7%
-6%
-5%
-7%
-10%
6%
-7%
-1%
-9%
1%
1%
-2%
-5%
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
RETAIL BEHAVIOR
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
THE PRE-RECESSION LUXURY FASHION CONSUMER
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Spend Growth
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
NEWCOMERS ARE DRIVING GROWTH IN THE RECOVERY
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Spend Growth by Consumer Segment
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© 2010 American Express Travel Related Services Company, Inc. All rights reserved.CONFIDENTIAL, PROPRIETARY & TRADE SECRET INFORMATION. This document contains confidential, proprietary, and trade secret information of American Express Company and its subsidiaries and affiliates ("American Express"), and may not be disclosed in whole or in part to any third parties without prior written consent of American Express.
GENERATIONAL TRENDS - LODGING
2010 YOY Spend GrowthEconomy Midscale Upscale Luxury
Gen Y 4% 14% 23% 24%
Gen X (7%) 8% 10% 10%
Baby Boomers (12%) 3% 6% 6%
Seniors (15%) (1%) 0% 1%
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