Global consumers are increasingly spending their disposable income on experiences rather than material goods.
Consumers’ desire for life experiences is spurring a growth in luxury travel that is outpacing the rest of the travel industry, finds a new Amadeus report featuring data from Tourism Economics.
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, versus 4.2 per cent for overall travel.
This trend will continue to accelerate over the next ten 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.
This trend is good news for the luxury travel sector.
The report, Shaping the Future of Luxury Travel, reveals the fresh challenges and opportunities that the luxury travel market will face over the next decade.
Some key findings from the report include the observation that tourism has entered a new age of luxury travel, where luxury is curated, real-time and experience-led.
At the same time, 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.
A human desire for more rewarding experiences provides an essential catalyst to evolve and improve travel industry quality and service standards, argues the report.
“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,” said Rob Sinclair-Barnes, strategic marketing director, Amadeus IT Group.
“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.”