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Luxury Travel - UK - November 2017

“In the longer term, new growth opportunities in the market will come from a new generation of luxury consumers who value unusual experiences above material possessions, and who favour a more informal, less traditional kind of luxury aesthetic.”

John Worthington, Senior Analyst

This report examines the following issues:

  • Targeting new-generation luxury clients
  • Potential for celebration breaks

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Table of contents

  1. Overview

    • What you need to know
      • Covered in this Report
      • Executive Summary

          • The luxury traveller market
            • Figure 1: Luxury traveller groups, August 2017
          • Under-45s most likely to reduce luxury spending as economy slows
            • UK falls down HNWI table
              • Figure 2: Top 10 nations for number of HNWIs*, 2016
            • Strong growth seen across many specialist brands
              • Figure 3: Leading luxury holiday specialist operators, by turnover, 2016
            • Getting personal
              • Wellness and gastronomy key elements
                • Figure 4: Elements of luxury travel, August 2017
              • North America and Asia are top luxury choices
                • Figure 5: Destinations visited for luxury holidays, by luxury traveller groups, August 2017
              • Cruise/escorted tours are key growth areas for specialist brands
                • Figure 6: Types of luxury holiday taken, by luxury traveller groups, August 2017
              • ‘Comfort’ and ‘feeling special’ are most popular meanings attached to luxury travel
                • Figure 7: Meanings attached to luxury holidays, by luxury traveller groups, August 2017
              • Analogue luxury
                • Figure 8: Attitudes towards holidays, by luxury traveller groups, August 2017
              • What we think
              • Issues and Insights

                • Targeting new-generation luxury clients
                  • The facts
                    • The implications
                      • Potential for celebration breaks
                        • The facts
                          • The implications
                          • The Market – What You Need to Know

                            • Incomes squeezed even in top quintile
                              • UK HNWI growth has been overtaken
                                • Leading long-haul destinations
                                  • Mauritius, India, Vietnam and Japan among trending luxury destinations
                                    • Luxury cruises on crest of a wave
                                      • LGBT and mini-moon opportunities
                                      • Market Background

                                        • Top household quintile sees real-term fall in income…
                                          • Figure 9: Average annual household income after tax and benefits, by quintile, 2008/09-2015/16
                                        • …but older travellers are less likely to reduce holiday spend
                                          • Figure 10: Agreement with the statement ‘Concerns about the UK economy mean that I am likely to spend less on holiday in the next 12 months’, by demographics, August 2017
                                        • UK HNWI growth has stalled
                                          • Figure 11: Top 10 nations for number of HNWIs*, 2014-16
                                        • Overseas holidays still up but growth rates slowing
                                          • Figure 12: Trends in the number and value of overseas holidays taken by UK residents, 2011-16
                                        • The hybrid long-haul traveller
                                          • Figure 13: Long-haul, short-haul and total overseas holiday volume by UK residents, 2011-16
                                        • Holidays to Spain and Italy booming
                                          • Figure 14: Top 20 overseas holiday destinations, by number of trips, 2012-16
                                        • Holidays to Caribbean up 18% in 2016
                                          • Figure 15: Top 15 long-haul holiday destinations, by number of trips by UK residents, 2015 and 2016
                                        • Maldives and Mauritius top Kuoni’s destination ranking
                                          • Japan currently a high-growth luxury destination
                                            • Figure 16: Top 20 luxury holiday destinations, Kuoni Annual Trends report, 2012-17
                                          • Ultra-luxury cruise enjoying surge in demand
                                            • Figure 17: Volume of UK ultra-luxury cruise passengers, 2010-16
                                          • Weddings in decline but spending is rising
                                            • Figure 18: Number of marriages in England and Wales, 2000-14
                                          • Same-sex marriage opportunity
                                          • Companies and Products – What You Need to Know

                                            • Kuoni remains largest luxury specialist but revenue growth is flat
                                              • Audley and ITC have become second and third-biggest players
                                                • A&K rethinks strategy in wake of Chinese investment
                                                  • Leading French specialist enters UK market
                                                    • ‘Adventure plus comfort’ and wellness are key trends
                                                    • Luxury Travel Specialists

                                                        • Figure 19: Leading luxury holiday specialist operators, by turnover, 2010-16
                                                      • Kuoni expanding its touring programme
                                                        • Fast-growing Audley positions itself as tailor-made specialist
                                                          • ITC emerges as a leading player following acquisition
                                                            • Scott Dunn revenues have tripled since 2010
                                                              • Kenwood has the highest six-year growth rate
                                                                • Destinology to open second store following full Saga takeover
                                                                  • A&K targets new breed of traveller following Chinese takeover
                                                                    • French group Voyageurs du Monde enters UK market
                                                                    • Luxury Travel Product Innovation

                                                                      • A simpler luxury aesthetic
                                                                        • Luxury adventure
                                                                          • Cruise targeting younger premium travellers
                                                                            • All-inclusive wellness
                                                                              • Airbnb-deluxe
                                                                                • Self-exploration
                                                                                  • A taste of the high life
                                                                                  • The Consumer – What You Need to Know

                                                                                    • Big spenders
                                                                                      • Spa and fine dining are key elements at top end of market
                                                                                        • North America and Asia are leading destination choices
                                                                                          • Beach/city are most popular but cruise/escorted tours offer huge opportunity for specialist brands
                                                                                            • Millennials more likely to value experiences over stuff
                                                                                              • Feeling special is key at top end of market
                                                                                                • Real luxury
                                                                                                  • Human values
                                                                                                    • Hibernation mode
                                                                                                    • Defining the Luxury Traveller

                                                                                                      • One in 20 consumers spend £3,000+ per head on holiday
                                                                                                          • Figure 20: Amount spent on most expensive holiday taken, 2016 and 2017
                                                                                                        • One in 10 consumers take luxury short breaks
                                                                                                          • Figure 21: Duration of most expensive holiday taken, August 2017
                                                                                                        • Almost three in 10 holidaymakers have stayed in five-star accommodation
                                                                                                          • Figure 22: Use of premium/luxury holiday accommodation, August 2017
                                                                                                        • Luxury traveller groups
                                                                                                            • Figure 23: Luxury traveller groups, August 2017
                                                                                                        • The Luxury Traveller – Products and Services

                                                                                                            • Wellness and gastronomy are key elements
                                                                                                                • Figure 24: Elements of luxury travel, by luxury traveller groups, August 2017
                                                                                                                • Figure 25: Number of luxury travel elements in most expensive holiday, August 2017
                                                                                                            • The Luxury Traveller – Destinations

                                                                                                              • North America and Asia are leading luxury destinations
                                                                                                                • Figure 26: Destinations visited for luxury holidays, by luxury traveller groups, August 2017
                                                                                                            • The Luxury Traveller – Holiday Types

                                                                                                              • Cruise and escorted tours have big luxury travel potential
                                                                                                                • Figure 27: Types of luxury holiday taken, by luxury traveller groups, August 2017
                                                                                                              • Experimental luxury group
                                                                                                                • Figure 28: Number of luxury holiday types taken in past five years, August 2017
                                                                                                              • Dream holidays
                                                                                                              • The Luxury Traveller – Meaning of Luxury

                                                                                                                • Millennials value luxury experiences more than products
                                                                                                                  • Comfort, feeling special, unique experiences and memories are leading associations
                                                                                                                    • Figure 29: Meanings attached to luxury holidays, by luxury traveller groups, August 2017
                                                                                                                  • Escape, surprise and adventure are important themes for younger luxury travellers
                                                                                                                    • Room with a view
                                                                                                                    • The Luxury Traveller – Attitudes

                                                                                                                      • Authenticity the new luxury?
                                                                                                                        • Specialist advice highly valued by luxury travellers
                                                                                                                          • Unconventional self-image
                                                                                                                            • It’s not what you own but where you’ve been
                                                                                                                              • Figure 30: Agreement with attitudinal statements towards holidays, by luxury traveller groups, August 2017
                                                                                                                            • Luxury as an analogue experience
                                                                                                                              • Luxury Occasions
                                                                                                                                • Under-45s most likely to reduce luxury spend
                                                                                                                                • CHAID Analysis – Attitudes

                                                                                                                                  • Methodology
                                                                                                                                    • A bucketful of memories
                                                                                                                                      • Figure 31: Target groups based on statements about holidaying – CHAID – Tree output, August 2017
                                                                                                                                      • Figure 32: Target groups based on statements about holidaying – CHAID – Table output, August 2017
                                                                                                                                  • Appendix

                                                                                                                                    • Definitions
                                                                                                                                      • Abbreviations

                                                                                                                                      Luxury Travel - UK - November 2017

                                                                                                                                      US $2,648.76 (Excl.Tax)