Since 2016, there has been a shift in the luxury market, from a desire for luxury goods to more demand for luxury experiences. There is a “pursuit for experience over possession.” Affluent consumers are seeking higher spiritual and emotional fulfillment, leading them to travel. Not only do luxury travelers want a high-end experience, they are also focused on wellness and how this experience will benefit their mind, body, and soul. So, what is experience based luxury? How are consumers looking for it? Who are they?
What: A Luxury-Based Experience
“Travel & hospitality is going beyond the experience economy to the ‘transformation economy,’ where an experience changes us in some way during a particular moment in time. When travel brands can design the experience to be so significant for a particular person and provide the exact experience that they need at a particular moment in time, it becomes easier to deliver a life transforming experience. That aspiration can range anywhere from desiring to be a more creative person to being a better parent, so travel brands have an opportunity to support that evolution.”The Evolution of Luxury Hospitality Whitepaper VERB, 2017
With this travel trend, it’s all about what the destination can offer to travelers. A smaller, lesser-known destination can be highly successful as a luxury destination if they offer consumers unique and high-end experiences. There are a few different ways you can emphasize the high-end experiences your destination offers:
- Personalization: nothing says high-end like an experience that has been tailored for you and only you.
- Exclusivity: an exclusive experience can make a consumer feel special which is what justifies the price of luxury.
- Authenticity: consumers are looking for authenticity from the brand selling their experience.
According to the National Travel Association, the top reasons behind high-end travel include exploring new destinations, rest and relaxation, seeking authentic experiences in new destinations, rediscovering previously visited destinations and personal enrichment.
How Consumers are Finding Luxury Travel
In the niche market of luxury travel it’s important to know how consumers are finding this product.
- The most common place for consumers to research luxury experiences is through digital and social media. Luxury travelers are highly influenced by authentic brands and experiences they see on social media.
- Travel influencers are a great way to pique the interest of consumers. People love consuming content that is extravagant, expensive, and unique.
- Consumers also love posting that extravagant content. It is important to take into consideration how “Instagram-able” an experience is. A consumer is more willing to book a luxury experience based on how it will make them look on social media.
Who are Luxury Travelers?
There are many different types of luxury travelers, so it’s important to first understand how luxury your target audience is. For example, one person could see a private jet as their everyday type of travel, while another could see it as a once-in-a-lifetime experience.
With so many differences, we look to similarities between luxury travelers and who is booking the most luxury travel to define the market.
- The emerging middle class is a huge market for luxury travel. These people have disposable income and want to spend it on exclusive experiences.
- We also see older Millennials as the most willing to spend on luxury travel.
- There is a difference between the personal luxury traveler and the business luxury traveler.
By better understanding your audience’s spending habits, consuming habits, types of cars they drive and so forth, you can narrow in on how and where they spend their money or how they spend their time. Then, you can advertise on certain websites, pitch stories to specific publications, and target their interests in digital advertising. For example, if they are more likely to own a Porsche, you can target publications that focus on Porsches.