Aiming to help the travel industry better target and service its fastest-growing segment, a new report entitled Shaping the Future of Luxury Travel has been released which explores luxury travel trends until 2025.
Commissioned by global travel technology provider, Amadeus, and developed with data from Tourism Economics, the report was collated with the help of global luxury travel experts across specialist travel concierge agencies, airlines, hoteliers and intermediary suppliers through Connections, a global networking event organiser for luxury travel providers.
The report uncovered that global consumers are increasingly spending their disposable income on experiences rather than material goods. The consumer’s wish for life experiences is therefore stimulating a growth in luxury travel that is outpacing the rest of the travel industry.
Between 2011 and 2015, luxury travel, in terms of outbound flights on business or first class, saw a 4.5 per cent compound annual growth rate (CAGR), versus 4.2 per cent for overall travel. This trend is anticipated to accelerate over the coming 10 years, with luxury travel trips projected to grow at a CAGR of 6.2 per cent between 2015 and 2025, almost a third faster than overall travel at 4.8 per cent.
Some key findings within the Shaping the Future of Luxury Travel report reveal the challenges and opportunities that the luxury travel market will come to face over the next decade.
The report shared that: Luxury travel has entered a new age, where luxury is curated, real-time and experience-led; North America and Western Europe account for 64 per cent of global outbound luxury trips, despite only making up 18 per cent of the world’s population; from 2011-2025, Asia Pacific’s luxury travel market will see faster overall growth than Europe’s, but this growth will decelerate from 2015-2025; India’s luxury market CAGR of 13 per cent is higher than any of the other BRIC nations, and is the highest of the 25 countries explored in this report; a human desire for more rewarding experiences provides an essential catalyst to evolve and improve travel industry quality and service standards; meanwhile, the report has identified a hierarchy of luxury travel needs ranging from five-star quality and service standards to exclusive VIP privacy and security.
Adding to this, the report also identifies six luxury traveller tribes to help travel providers better target their luxury customer market: Always Luxury; Special Occasion; Bluxury; Cash-rich, time-poor; Strictly Opulent; and Independent Affluent.
Strategic marketing director, Amadeus IT Group, Rob Sinclair-Barnes commented: “Luxury means different things to different people and this is especially true today. As emergent middle classes seek the material aspect of luxury travel, more mature markets are craving a new, evolved kind of luxury. This is why offering luxury customers a relevant personal and exclusive experience will become even more crucial than it is today – it will be a differentiating factor between old and new luxury.”
Sinclair-Barnes added: “Understanding your business’s role in delivering an end-to-end luxury experience for a traveller is key to improving collaboration, and reinforcing an industry-wide push for consistent luxury service. Exploring the latest technologies and innovations for making the industry work better as a whole is key to achieving a new level of luxury that has never existed before.”
Download a free copy of the Shaping the Future of Luxury Travel report here.