Future of Travel

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The Future
of Luxury Travel

© Brown + Hudson 2011

A Global Trends Report
First Findings for ILTM Asia
JUNE 2011

EXECUTIVE SUMMARY
What does the future hold for the luxury travel industry? Where are we headed? In order to isolate the key trends and achieve a clear view of the direction of luxury travel, International Luxury Travel Market (ILTM) has launched a global research project on the luxury travel industry. The objective of the research is two-fold: to identify key supply and demand trends, and to explore the future of the business relationship between buyers and suppliers. This report additionally seeks to establish benchmarks for the global luxury travel industry. “The Future of Luxury Travel, A Global Trends Report” is a qualitative and quantitative research project that is being carried out over three years, from 2011 to 2013. To measure the main trends and challenges of the luxury travel industry, an Internet survey with luxury travel buyers and suppliers has been launched, and one-on-one interviews with CEOs or senior representatives from major luxury travel groups worldwide are being conducted. In addition, focus groups with buyers (tour operators and travel agents who provide a distribution channel for reaching the consumer, i.e., the luxury traveller) and suppliers (including airlines, cruise lines, hotels, etc.) took place in Singapore and New York.

The luxury travel industry and the luxury sector
Initial results show that the luxury travel industry follows the same trends as the luxury sector in general, although luxury travel is not commonly categorised within the luxury industry. Not only are luxury travel sectors distinguished by uniqueness, brand imagery and high price levels—the main guiding principles of the luxury sector—but they are also impacted by the same trends. A clear distinction between ultra-luxury and affordable luxury has been observed, together with the development of personalised services, a move away from ostentation, the increasing importance of Web-based media, and progressively more attention to green/ethical social principles. Above all, as with the luxury sector in general, the demand for luxury travel is expected to grow, especially in relation to emerging economies, e.g., in the BRIC countries (Brazil, Russia, India, and China).

Emerging destination trends
Research with luxury travel buyers indicates an expanding number of destinations now growing in popularity, with a demand by travellers for increased diversity:





More privacy / less ostentation: a quieter, more discreet style of luxury is now preferred; private islands are highly desirable.
Increase in demand for open-range excursions: response to our survey underscored the lure of Brazil, Argentina/Chile (Patagonia), Australia and New Zealand for their spectacular landscapes and unspoilt nature.

A growing interest in off-the-beaten-track destinations: some areas currently avoided for political or social reasons are expected to become more attractive to tourists. Destinations with appeal to environmentally concerned and culturally interested travellers: destinations with fascinating cultures and traditions, including Israel and Peru, are growing in popularity with affluent travellers, as are destinations actively working to protect nature and endangered animal species.

Five key trends that will affect the luxury travel industry
The first findings of the survey conducted by Horwath demonstrate that the luxury travel sector will be affected by five key trends over the next few years:





Emerging destinations will gain in importance. The increasing demand for authenticity, new experiences and exclusivity will boost interest in places reflecting the culture and traditions of local communities.

The need for personalisation will continue to impact the luxury travel industry, leading to the creation of enduring personal relationships based on trust between luxury travel providers and...
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