An increased focus on exclusive experiences is marking a change in the luxury travel sector, according to the latest report on the subject by data and analytics company GlobalData.
The report, titled ‘Tapping into the Luxury Travel Market’, reveals that upscale tourism is gradually changing, with travellers shifting from opulence to exclusive experiences. Among the report’s findings, the global number of guests staying in luxury hotels increased from 186.3 million in 2009 to 306.3 million in 2017 and is expected to reach 394.6 million in 2021.
"Whereas luxury travel was once associated with first-class transportation, five-star accommodation, and Michelin-starred restaurants, changing consumer perceptions and priorities are redefining the concept of luxury in travel,” said Konstantina Boutsioukou, Associate Travel & Tourism Analyst at GlobalData. “A high appreciation of different cultures and a prioritization of experiences over ownership of goods have resulted in travellers seeking deeper travel experiences"
According to the company, as the concept of luxury tourism is changing, so is the target audience for these holidays: for example, while millennials may not be willing to spend much on upscale accommodation, they may be willing to trade up on exclusive activities characterized by a more experiential element.
“Luxury trips are no longer the preserve of upper middle class, high-net-worth individuals (HNWI), and ultra-high-net-worth individuals (UNHWI) as the choice and affordability of these holidays improves,” Boutsioukou said.
The report identifies four key types of luxury travellers; ‘bleisure’, ‘time is money’, ‘special occasion’ and ‘ultra luxury’. Whereas the first three categories attract interest from across the generations, particularly millennial consumers, the ultra-luxury category tends to be dominated by HNWI and UHNWI male baby boomers. However, the number of ‘ultra luxury’ female and millennial travellers continues to grow, the report said.
Other findings include:
- According to GlobalData, emerging nations in Asia dominate the top 10 countries share of female HNWIs, due to their rapid rise in the region over the past decade. This cohort is particularly interested in traveling, presenting an excellent opportunity for travel operators especially in health and wellness tourism.
- Affluent millennials are particularly interested in sports and adventure tourism, but also in wellness retreats that allow them to relax, detach and recharge from their hectic lifestyle.
- Key trends in the luxury travel market in 2018 can be characterised by ‘the quest for authenticity’, with a growing interest in adventure travel, health and wellness retreats, responsible travel and multi-generational travel.