Table of Contents
Executive Summary
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- Affluent households leading overseas revival
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- Figure 1: Overseas holiday market volume, annual percentage growth, 2009-15
- HNWI market expected to top 1 million
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- Figure 2: UK average weekly earnings (excluding bonuses)* vs CPI inflation, percentage change year on year, June 2013-August 2015
- Over-55s the biggest-ticket holiday spenders
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- Figure 3: Luxury traveller groups, August 2015
- Long-haul cost reductions likely to boost luxury market
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- Figure 4: Most popular destinations for a luxury holiday, August 2015
- Resort lovers and destination explorers
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- Figure 5: Most popular luxury holiday types (ranked 1-3), August 2015
- ‘I am a traveller, you are a tourist’
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- Figure 6: Personal ideas of what a luxury holiday means, August 2015
- Transport part of the luxury experience for most
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- Figure 7: Most important features of a luxury holiday (ranked 1-5), August 2015
- Tailor-making is the USP for luxury specialists
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- Figure 8: Willingness to spend on extras on a luxury holiday, August 2015
- What we think
Issues and Insights
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- Increasing accessibility of luxury travel creates greater need to differentiate
- The facts
- The implications
- Appealing to affluent Baby Boomers – the key targets for luxury travel
- The facts
- The implications
The Market – What You Need to Know
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- UK HNWIs to exceed 1 million by 2018
- Affluent travellers spearheading overseas recovery
- Macro-factors boosting premium travel
- Mexico, Cuba and Vietnam fast-growing destinations
- Affordable luxury
- Over-55 boom favours big-ticket travel
Socio-economic
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- UK wealth gap grows
- Half of HNWIs live in London
- Top quintile has seen net income fall…
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- Figure 9: Average annual household income after tax and benefits, 2008/09-2013/14
- …but UK wages now rising
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- Figure 10: UK average weekly earnings (excluding bonuses)* vs CPI inflation, percentage change year on year, June 2013-August 2015
- Oil price slump continues
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- Figure 11: Brent crude spot oil price (US$ per barrel), January 2014-September 2015
- Sterling boost for long-haul
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- Figure 12: Sterling exchange rate vs selected currencies, annual averages, 2009-14, and spot rate October 2015
- Rising over-55 population should benefit luxury brands
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- Figure 13: Trends in the age structure of the UK population, by gender, 2009-19
Travel
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- Holidays abroad on course for 10% rise in 2015
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- Figure 14: Overseas holiday market volume, value and average spend, 2009-14
- Longer domestic breaks also rising
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- Figure 15: Domestic holiday market volume, value and average spend, 2009-14
- Luxury travel market – improving prospects
- Package revival positive for luxury brands
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- Figure 16: Overseas holiday market volume, independently booked versus package holidays, 2009-14
- Confidence also returning to long-haul
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- Figure 17: Volume of overseas holidays, long-haul vs short-haul, 2009-14
- Spain consolidates position as most popular overseas destination
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- Figure 18: Top 20 overseas holiday destinations, 2009-14
- Holidays to US and Caribbean poised for recovery
- Mexico is fastest-growing long-haul destination
- North Africa/Middle East struggling but UAE tourism so far immune
- Maldives & Thailand leading luxury destinations in Kuoni report
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- Figure 19: Top 20 luxury holiday destinations, Kuoni Annual Trends report, 2012-15
- Mexico, Cuba and Vietnam are rising stars
- Over-55s have highest spend per holiday
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- Figure 20: Overseas holidays, number of trips, nights and spend, by age*, 2014
- Figure 21: UK domestic holidays, number of trips, nights and spend, by age, 2014
- APD reforms should help luxury travel
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- Figure 22: Air Passenger Duty (APD) rates, April 2014-April 2016
- The hybrid traveller
- The democratisation of luxury
- TUI pushes rapid long-haul expansion
- Selling luxury travel as part of overall lifestyle
Key Players – What You Need to Know
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- Leading luxury specialists
- TUI and TC developing more distinctive luxury brands
- Lifestyle hotels target Millennials
- P2P luxury
- Luxury for life
- Dreamliner opens new long-haul possibilities
- Size matters in cruise
Luxury Travel Specialists
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- Kuoni leads market but has lost revenue
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- Figure 23: Specialist luxury holiday operators, annual turnover, 2008-14
- Corporate activity sweeps luxury sector
Luxury Product Trends and Innovation
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- Mainstream product increasing
- TUI’s upmarket branded concepts
- Thomas Cook revamps Signature brand
- The upscale resort – Le Touessrok Shangri-La
- The luxury lifestyle hotel – Ham Yard & Zetter Townhouse
- Luxury P2P
- Luxury travel as personal celebration
- Attention to the details
- Pet pampering
- Upscale air travel
- High life for over-50s
- Small is beautiful
- Escorted tours
- Cruise
- Expertise
- Short and sweet luxury
The Consumer – What You Need to Know
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- Older affluents are big-ticket spenders
- North America is leading dream destination
- Big holiday spenders seek unique, exclusive experience of destination
- Four key luxury features
- Trouble-free travel
- Making it personal
The Luxury Traveller
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- Expensive holiday cost
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- Figure 24: Amount spent on most expensive holiday in the past 5 years, August 2015
- Expensive holiday duration
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- Figure 25: Length of most expensive holiday in the past 5 years, August 2015
- Upmarket accommodation
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- Figure 26: Use of luxury/high-cost holiday accommodation, August 2015
- Luxury traveller categories
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- Figure 27: Luxury traveller groups, August 2015
- Luxury traveller demographics
Preferred Luxury Holiday Destinations
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- Long-haul preferences dominate
- Italy is top short-haul choice
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- Figure 28: Most popular destinations for a luxury holiday, August 2015
Preferred Luxury Holiday Types
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- Figure 29: Most popular destinations for a luxury holiday (ranked 1-3), August 2015
- ‘Big-ticket holiday spenders’ are more destination- than resort-focused
- Soft learning a key luxury holiday ingredient for Boomers
- Premium activity break potential
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What Makes a Luxury Holiday?
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- Living the dream
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- Figure 30: Personal ideas of what a luxury holiday means, August 2015
- ‘Big-ticket spenders’ seek adventure plus comfort & service
- Luxury as connoisseurship
- Luxury as inner experience
- Luxury as reward
- Luxury as celebration
Luxury Holidays – Facilities and Services
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- Figure 31: Most important features of a luxury holiday (ranked 1-5), August 2015
- Older affluents expect to travel in luxury
- Men prefer spa to sport
- Men under 45 most likely to seek expert advice
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Luxury Holidays – Extras
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- Luxury starts at the airport
- Tailor-made luxury
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- Figure 32: Willingness to spend on extras on a luxury holiday, August 2015
- Local expertise is worth a premium
Appendix
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- Abbreviations
- Definition
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