Over the last 10 years, there’s been an intense focus on the growing wealth gap between America’s top 1% richest households and the rest of the population. But despite the stagnating fortunes of the American middle class, luxury travel is a rapidly growing segment.
That’s not only because rich Americans are traveling more but also due to new, creative business and pricing models that have made luxury destinations more accessible to the middle class. In addition, rising incomes in major emerging economies such as China and India have been a boon for players in the luxury travel industry.
The following are some of the most significant trends that will characterize luxury in 2019.
When you hear the word ‘authentic travel’, what usually comes to mind is a backpacker journeying through a developing country, sleeping in hostels, using chaotic public transportation and eating in seedy backstreet restaurants. Yet, you can have authenticity in luxury travel and a growing number of clients are demanding it.
It’s no longer about simply going to an exclusive resort with expensive accommodation. Rather, authenticity could mean traveling to the same location but seeking a different experience each time. If you regularly vacation in the Maldives for instance, you get a better feel of the people and culture when you stay in and visit different locations each time.
Experience Over Stuff
The quintessential mark of traveling the world used to be the diverse souvenirs one would collect from their various trips. But thanks to the proliferation of digital cameras and ubiquity smartphones, the experience of travel has taken priority over buying stuff. This is bad news for luxury stores and vendors of eccentric souvenirs around the world but great news for luxury adventure travel agents.
The modern traveler is more interested in an experience that is worthy of their Instagram account. In any case, they can always shop from luxury stores back home or purchase the souvenir they want through the Internet. They cannot experience the destination remotely though.
Customization and Personalization
Luxury travel has always had a greater degree of personalization than ordinary travel. After all, personalization and customization often mean having to spend more to have an experience that deviates from the standard offering.
Yet, a significant proportion of luxury travelers have in the past preferred to go with the predictable in order not to stand out from the crowd. These travelers will be an ever smaller minority in the luxury travel segment especially as Millennials (who have a greater propensity for personalization than previous generations) gradually become the most important demographic in the tourism industry.
Travel agents will need to have a broad and deep understanding of destinations they recommend to clients so they can satisfy the rising expectation for personalization.
Staying in Family-owned Properties
Staying in family-owned properties has long been associated with budget travel. But as you’d expect, the nature of family-owned properties is as diverse as the owners’ wealth and income profiles. So it’s not surprising that there has emerged a luxury niche within this travel segment.
Luxury villa rentals (for example, https://luxuryretreats.com/) can deliver a degree of privacy, flexibility, and ultra-immersion to the travel experience that would be difficult to achieve when staying in the most high-end hotels.
Catering to Affluent Chinese
China only trails the United States in the number of individuals with a net worth of more than a million dollars. When you consider it also has the largest middle class in the world, it’s no wonder that the Chinese have spirited past Americans and Germans to become the top spenders on international tourism. And this spending power is only projected to grow.
In line with this overall travel trend, players in the luxury market are already going out of their way to cater to the Chinese traveler. That means ensuring Mandarin translation is available for all documentation as well as incorporating elements that make the Chinese traveler more comfortable. These include Chinese newspapers, Chinese TV channels, and Chinese cuisine. A Mandarin speaker at the concierge desk can make Chinese guests more comfortable.
Most of these trends aren’t really new. They’ll only continue to grow in importance through 2019 and beyond.