New Amadeus report looks at luxury travel trends until 2025 to help the travel industry better target and service its fastest-growing segment
Shaping the Future of Luxury Travel is a new report commissioned by Amadeus and developed with data from Tourism Economics with interviews 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 revealed that India’s luxury market compound annual growth rate (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.
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.
Between 2011 and 2015, luxury travel, in terms of outbound flights on business or first class, saw a 4.5 per cent CAGR, versus 4.2 per cent for overall travel. This trend will continue to accelerate over the next 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.
This trend is considered good for the luxury travel sector. The report reveals the fresh challenges and opportunities that the luxury travel market will face over the next decade. Other key findings from the report include:
We have entered a new age of luxury travel, 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
A human desire for more rewarding experiences provides an essential catalyst to evolve and improve travel industry quality and service standards
A hierarchy of luxury travel needs is identified, ranging from five star quality and service standards to exclusive VIP privacy and security
In 2015, Amadeus released a report called Future Traveller Tribes 2030, which identified six traveller tribes based on consumer behaviour, recognising that purchasing patterns change depending on the circumstances of each trip.
Using similar methodology, Shaping the Future of Luxury Travel, 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.
“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,” he added.