Monday, November 6, 2023
The latest World Travel Market Global Travel Report, unveiled at World Travel Market London on November 6, 2023, reveals a growing trend towards “affordable luxury” in the travel industry.
Despite financial constraints affecting many travelers, the report, developed in partnership with Oxford Economics, indicates that consumers continue to prioritize upscale travel experiences.
This shift toward “affordable luxury” aligns with a broader consumer trend of seeking unique and novel experiences while on vacation. Following the pandemic and travel restrictions, there is a strong desire to enhance travel experiences. This demand may stem from pent-up savings during lockdowns and relatively low unemployment rates in most countries.
The report acknowledges that consumers unaffected by economic downturns are likely to continue opting for luxury destinations. Conversely, those in lower income groups may feel the impact of squeezed personal incomes, leading them to explore budget travel options or reduce their overall travel.
Data from the United States reveals that the cost of living has a more pronounced impact on households with annual incomes under $50,000. However, higher-income individuals show a “high likelihood” of future travel.
Despite ongoing challenges, such as rising costs, currency fluctuations, and supply-side issues, travelers seem willing to pay higher prices for enhanced travel experiences.
Juliette Losardo, Exhibition Director at WTM London, emphasized the travel industry’s opportunity to cater to consumers seeking “affordable luxury” by offering value-added services, flexibility in departure dates, and destinations that provide better value for money.
Dave Goodger, Managing Director EMEA at Tourism Economics, emphasized the report’s findings that reveal consumers’ enduring appetite for travel despite economic complexities, offering valuable insights to guide strategies for the travel industry in 2024 and beyond.