Global Luxury Travel Market – Insights
The global luxury travel market is expected to witness significant growth over the forecast period, owing to increasing number of travelers worldwide. According to the World Travel and Tourism Council, the worldwide investment on luxury travel and tourism was US$ 4,233.3 billion in 2017, which is estimated to reach US$ 6,605.3 billion by 2028.
Moreover, increasing disposable income, especially in emerging economies, is a major driver for growth of the luxury travel market during the forecast period. According to the Organization for Economic Cooperation and Development, the global middle class populace is projected to increase from 1.8 billion in 2009 to 4.9 billion by 2030. For instance, disposable income in China increased to US$ 5,278.3 in 2017 from US$ 3562.2 in 2012. Moreover, consumer spending in India increased to US$ 270.48 billion in 2018, from US$ 63.67 billion in 2004. Similarly, consumer spending in the U.S. increased from US$ 11,971.9 billion in 2015 to US$ 12,847.82 billion in 2018.
Furthermore, increasing adoption of digital technology is also expected to boost growth of the market. Increasing use of internet and high presence on people on social media platforms also aids in the market growth. Players in the market are focused on capitalizing the social media presence to expand their consumer base and to strengthen consumer relation. Use of internet allows to compare brands and offers several choices. Moreover, the influence of user-generated travel content is more influential over conventional advertising. The appeal for travel storytelling has rapidly increased, owing to platforms such as Instagram and various blogging sites.
Therefore, increasing use of internet and social platforms is expected to contribute to growth of the luxury travel market during the forecast period. For instance, according to the India Brand Equity Foundation (IBEF), India's internet economy was valued at US$ 125 billion in 2017, and is expected to increase to US$ 250 billion by 2020. Moreover, according to the International Trade Administration, China has the world’s largest e-commerce market and is projected to reach US$ 1.6 trillion by 2019. Over 40% of the total global e-commerce spending comes from China.
The global luxury travel market was valued at US$ 201.07 billion in 2017, and is expected to register a CAGR of 6.7% in terms of revenue, over the forecast period (2018 – 2026), to reach US$ 353.16 billion by 2026.
Figure 1. Global Luxury Travel Market Share, By Region, 2017
Source: Coherent Market Insights, 2017-18
North America held a dominant position in the luxury travel market in 2017, owing to increasing number of millionaires in the region. For instance, according to the OECD (Organization for Economic Cooperation and Development) statistics, US constituted a share of 65.86% among the share of the top 5% of wealth which increased and reached 68.05% in 2016.
Figure 2. Global Luxury Travel Market Share, By Age Group, 2017
Source: Coherent Market Insights, 2017-18
Among age group, baby boomers segment held dominant position in luxury travel market in 2017, and the millennials segment is expected to record a significant growth during the forecast period. For instance, the older millennials (aging 25-35) are currently entering in their peak earning years and earning more affluence at unprecedented rates. Therefore, increasing preference of baby boomers and millennials for luxury travel is expected to boost growth of the market.
Moreover, millennials are expected to surpass baby boomers as the largest living adult generation in the U.S. According to population projections from the U.S. Census Bureau, on 1st July, 2016 (the latest date for which population estimates are available), millennials (aged between 20 to 35 years), recorded 71 million and baby boomers (aged between 52 to 70 years) recorded 74 million. In 2019, millennials are expected to overtake baby boomers in population as their numbers are expected to increase and reach 73 million and baby boomers are expected to decline to 72 million. Moreover, generation X (ages 36 to 51 in 2016) is projected to surpass the baby boomers in population by 2028.
Major players operating in the global luxury travel market include, Abercrombie & Kent USA, Absolute Travel, Inspiring Travel Company, TCS World Travel, TÜ ELITE, Cox & Kings Ltd., Travcoa, Micato Safaris, Scott Dunn Ltd., Kensington Tours Ltd., Butterfield & Robinson Inc. and others.
Luxury travel includes an enhancing experience with a combination of most desirable destinations, luxurious and serene accommodations, convenient commute, and a royal traveling experience. Luxury travel can be categorized into adventure & safari, cruise, rail journey, culinary travelling & shopping, customized & private vacations, and celebration.
Among age group, baby boomers segment held dominant position in the market in 2017, followed by millennials and generation X segments, owing to increasing disposable income in the age group. These generations have a continuous source of income as the number of working individuals is continuously increasing. According to the Regional Human Development Report of the United Nations Development Program (UNDP) published in 2016, in 2015, the working-age population was recorded as 0.86 Billion (considering people aged between 15 and 64 years) in India, and will grow to over a billion by 2050.
Increasing adoption of digital media has simplified the processes related to the luxury travel industry. For instance, bookings can be confirmed via online applications or websites and payments can be made through credit cards, debit cards or any other online mode of payment. Social media platforms are useful for the customers as well as for the vendors. Travelers as well as the vendors constantly keep themselves updated with the latest trends related to the luxury traveling. This is attributed to increasing use of internet, smartphones, laptops, and tablets. For instance, the revenue generated by Huawei in 2016 was US$ 79,969 Million and it increased and reached US$ 92,549 Million in 2017.
Key features of the study:
“*” marked represents similar segmentation in other categories in the respective section.
Table of Contents
* Browse 35 market data tables* and 25 figures* on "Luxury Travel Market” - Global forecast to 2026.
Coherent Market Insights followsa comprehensive research methodology focused on providing the most precise market analysis. The company leverages a data triangulation model which helps company to gauge the market dynamics and provide accurate estimates. Key components of the research methodologies followed for all our market reports include:
In addition to this, Coherent Market Insights has access to a wide range of the regional and global reputed paid data bases, which helps the company to figure out the regional and global market trends and dynamics. The company analyses the industry from the 360 Degree Perspective i.e. from the Supply Side and Demand Side which enables us to provide granular details of the entire ecosystem for each study. Finally, a Top-Down approach and Bottom-Up approach is followed to arrive at ultimate research findings.
Coherent Market Insights desk research is based on a principle set of research techniques:
Coherent Market Insights has a large amount of in-house repository of industry database. This is leveraged as a burner for initiating a new research study. Key secondary sources include:
Preliminary Data Mining
The raw data is obtained through the secondary findings, in house repositories, and trade surveys. It is then filtered to ensure that the relevant information including industry dynamics, trends, and outlook is retained for further research process.
Holistic approach is used to ensure that the granular and uncommon parameters are taken into consideration to ensure accurate results. The information from the paid databases are further combined to the raw data in order to standardize it.
Coherent Statistical model
We arrive at our final research findings through simulation models. Coherent Data Analytics Model is a statistical tool that helps company to forecast market estimates. Few of the parameters considered as a part of the statistical model include:
Once the findings are derived from the statistical model, large volume of data is process to confirm accurate research results. Data analytics and processing tools are adopted to process large chunk of collected informative data. In case, a client customizes the study during the process, the research finding till then are benchmarked, and the process for new research requirement is initiated again.
This is the most crucial stage of the research process. Primary Interviews are conducted to validate the data and analysis. This helps in achieving the following purposes:
The primary research is conducted with the ecosystem players including, but not limited to:
Finding it difficult to find the research that would cater to your business demands? Give us a chance to help you. One of our Research Consultants will connect to provide a customized solution.
Talk to our research consultant to design an exclusive report as per your research needs.
We aim to fulfil client's research demands with tailored research solutions.
We aim to provide research studies in quickest turnaround time and in a much cost effective manner.
We cover each industry from supply and demand side with an aim to provide a most holistic research study.
We strive to provide most accurate and reliable research findings in our research reports.