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UK Luxury Travel market report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Short and City Breaks market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry and how fast are its rates of growth? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

What you need to know

Some 41% of all holidaymakers have fallen into the definition of ‘All luxury travellers’ (see below for definition) at some point in the past five years. The overall net for luxury travel is therefore potentially very broad. However, the majority of luxury travel specialist brands are likely to concentrate on a much smaller target group. Mintel’s Big-ticket spenders account for an estimated 14% of all holidaymakers, while Five-star big-ticket spenders account for an estimated 7% (see below for definitions).

The specialist luxury sector appears to be thriving with a wave of corporate investment driving new product development, marketing activity and revenue growth, although a slowing economy, the rising cost of living and Brexit uncertainties may put the brakes on in the coming months, particularly among premium travellers under the age of 45. Beach resorts and five-star hotel/ city breaks still form the core of the market but luxury cruises, escorted touring holidays, premium adventure and luxury holiday rentals are dynamic segments, while the nature of luxury itself is becoming increasingly intangible, diverse and personalised.

Covered in this Report

For the purposes of analysis in this Report Mintel has defined three luxury traveller groups:

  • Big-ticket spenders – these are consumers who have spent either £1,000+ per head for a break of one to six nights, £1,500+ per head for a holiday of seven to 13 nights or £3,000+ per head for 14+ nights in the past five years.
  • ‘All luxury travellers’ – these are consumers who either fall into the above spending groups, or who have stayed in five-star or above accommodation, or spent £250+ per hotel night in the past five years.
  • Five-star big-ticket spenders – these are Big-ticket spenders (as defined above) who have also stayed in five-star or above accommodation in the past five years, since this is likely to be seen by most specialist brands as a core element of luxury travel.

Expert analysis from a specialist in the field

Written by John Worthington, a leading analyst in the Travel sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Travel brands can curate an annual portfolio of regular trips for an emerging tribe of multi-short breakers, offering a mixed programme of holiday types including R&R, hedonistic, activity/adventure and special interest, and a variety of destinations in the UK and abroad. John Worthington
Senior Travel Analyst

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Table of contents

  1. Overview

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

          • The market
            • HNWI growth in the UK lags behind elsewhere
              • Uncertainties around Brexit put a spotlight on cheaper destinations
                • Figure 1: What effect luxury travellers think Brexit will have on the economy, August 2018
              • Further increase in luxury (expedition) cruises expected
                • The US remains by far the most visited long-haul destination
                  • Figure 2: Top 10 long-haul destinations, by volume of trips (holidays), 2013-17
                • Companies and brands
                  • Kuoni showcases its Personal Travel Experts
                    • DER Touristik introduces tailor-made brand
                      • Airbnb’s additions disruptive for luxury travel suppliers
                        • Automotive and retail are flirting with luxury travel brands
                          • The consumer
                            • Defining the luxury traveller
                                • Figure 3: Luxury traveller segments, August 2018
                              • Even luxury holidaymakers travel economy
                                • Figure 4: Mode of transport used during most expensive holiday in past five years, August 2018
                              • Hotel suites, sea views and wellness are key elements
                                • Figure 5: Luxury elements present during most expensive holiday in past five years, August 2018
                              • The importance of making day trips and excursions bookable
                                • Figure 6: Activities undertaken during most expensive holiday in past five years, August 2018
                              • Luxury travellers want to return richer in knowledge
                                • Figure 7: Attitudes towards luxury holidays, August 2018
                              • Airbnb means serious competition for luxury travel brands
                                • Luxury travellers still love a special offer
                                  • Huge potential for cruising among luxury travellers
                                    • Figure 8: Interest in cruising, August 2018
                                  • Cities and wildlife/nature drive interest in cruising
                                    • Showcasing quality time could convince families to join a cruise
                                      • Showing flexibility in cruising could increase potential
                                        • What we think
                                        • Issues and Insights

                                          • Social media becomes more powerful in the customer journey
                                            • The facts
                                              • The implications
                                                • Travel expertise comes back in to fashion
                                                  • The facts
                                                    • The implications
                                                    • The Market – What You Need to Know

                                                      • HNWI growth in the UK lags behind elsewhere
                                                        • Uncertainties around Brexit put a spotlight on cheaper destinations
                                                          • Further increase in luxury (expedition) cruises expected
                                                            • The US remains by far the most visited long-haul destination
                                                            • Market Background

                                                              • Top earners see decline in real-term income over the longer term
                                                                • Figure 9: Average annual household income after tax and benefits, by quintile, 2008/09-2016/17
                                                              • HNWI growth in the UK lags behind elsewhere
                                                                • Figure 10: Top 10 nations for number of HNWIs*, 2014-17
                                                              • Over half of high earners are confident about their financial situation
                                                                • Figure 11: Consumer sentiment among high earners for the coming year, January 2017-October 2018
                                                              • Holidaying intentions among high earners remain strong
                                                                • Figure 12: Holidaying intentions among high earners, January 2017-October 2018
                                                              • Uncertainties around Brexit put a spotlight on cheaper destinations
                                                                • Figure 13: What effect luxury travellers think Brexit will have on the economy, August 2018
                                                              • Further increase in luxury (expedition) cruises expected
                                                                • Figure 14: UK and Ireland ocean cruise passengers, 2013-17
                                                              • The US remains by far the most visited long-haul destination
                                                                • Figure 15: Top 10 long-haul destinations, by volume of trips (holidays), 2013-17
                                                            • Companies and Brands – What You Need to Know

                                                              • Kuoni showcases its Personal Travel Experts
                                                                • DER Touristik introduces tailor-made brand
                                                                  • Airbnb’s additions disruptive for luxury travel suppliers
                                                                    • Automotive and retail are flirting with luxury travel brands
                                                                    • Luxury Travel Specialists

                                                                      • Despite fall in turnover, Kuoni remains market leader in premium travel
                                                                        • Figure 16: Leading luxury holiday specialist operators, by turnover, 2011-17
                                                                      • Kuoni showcases its Personal Travel Experts
                                                                        • The Inspiring Travel Company makes its debut on TV
                                                                          • DER Touristik introduces tailor-made brand
                                                                            • Mergers to offer more choice and strengthen position of brands
                                                                              • Airbnb’s additions disruptive for luxury travel suppliers
                                                                              • Launch Activity and Innovation

                                                                                • Companies are pushing boundaries to offer exclusive experiences
                                                                                  • Innovations to increase the comfort during travelling
                                                                                    • Personalisation to allow travellers to create their own travel experience
                                                                                      • Automotive and retail are flirting with luxury travel brands
                                                                                        • Increasingly fast-paced lifestyle triggers slower means of travel
                                                                                          • Figure 17: One of the three Grand Suites aboard the Venice Simplon Orient Express
                                                                                      • The Consumer – What You Need to Know

                                                                                        • Volume of luxury traveller segments
                                                                                          • Millennials are willing to spend money on travelling
                                                                                            • Even luxury holidaymakers travel economy
                                                                                              • The importance of making day trips and excursions bookable
                                                                                                • Luxury travellers still love a special offer
                                                                                                  • Huge potential for cruising among luxury travellers
                                                                                                    • Showing flexibility in cruising could increase potential
                                                                                                    • Defining the Luxury Traveller

                                                                                                      • High spending on holidays has not changed much over time
                                                                                                        • Figure 18: Amount spent on most expensive holiday taken, August 2015-August 2018
                                                                                                      • Most expensive holidays last a week or more, but short luxury breaks also appeal
                                                                                                        • Figure 19: Duration of most expensive holiday taken, August 2018
                                                                                                      • Three in 10 holidaymakers have stayed in five-star accommodation
                                                                                                        • Figure 20: Use of premium/luxury holiday accommodation, August 2018
                                                                                                      • Volume of luxury traveller segments
                                                                                                          • Figure 21: Luxury traveller segments, August 2018
                                                                                                        • Millennials are willing to spend money on travelling
                                                                                                          • Figure 22: Luxury traveller segments, by age and household income, August 2018
                                                                                                      • The Luxury Traveller – Modes of Transport

                                                                                                        • Self-drive itineraries not to be overlooked in the luxury segment
                                                                                                          • Figure 23: Mode of transport used during most expensive holiday in past five years, August 2018
                                                                                                        • Even luxury holidaymakers travel economy
                                                                                                          • Figure 24: Mode of transport used during most expensive holiday in past five years, August 2018
                                                                                                        • Room for airports and airlines to take travel experiences to new levels
                                                                                                        • The Luxury Traveller – Products and Services

                                                                                                          • Hotel suites, sea views and wellness are key elements
                                                                                                            • Figure 25: Luxury elements present during most expensive holiday in past five years, August 2018
                                                                                                          • A fifth of luxury travellers enjoyed four or more elements
                                                                                                          • The Luxury Traveller – Holiday Activities

                                                                                                            • The importance of making day trips and excursions bookable
                                                                                                              • Figure 26: Activities undertaken during most expensive holiday in past five years, August 2018
                                                                                                            • The power of social media
                                                                                                              • Figure 27: Activities undertaken during most expensive holiday in past five years, by age, August 2018
                                                                                                          • The Luxury Traveller – Attitudes

                                                                                                            • Luxury travellers want to return richer in knowledge
                                                                                                              • Figure 28: Attitudes towards luxury holidays, August 2018
                                                                                                            • Young urban travellers keen to learn
                                                                                                              • Figure 29: Attitudes towards learning experiences in luxury travel – CHAID, August 2018
                                                                                                            • Airbnb means serious competition for luxury travel brands
                                                                                                              • Figure 30: Attitudes towards luxury holidays, by age, August 2018
                                                                                                            • Luxury travellers still love a special offer
                                                                                                              • Figure 31: The need for special deals/offers, by age and household income, August 2018
                                                                                                          • The Luxury Traveller – Cruises

                                                                                                            • Huge potential for cruising among luxury travellers
                                                                                                              • Figure 32: Interest in cruising, August 2018
                                                                                                            • Cities and wildlife/nature drive interest in cruising
                                                                                                              • Figure 33: Cruise motivators, August 2018
                                                                                                            • Showcasing quality time could convince families to join a cruise
                                                                                                              • Figure 34: Cruise motivators, by age, August 2018
                                                                                                            • Younger potential cruisers are more likely to need an expert/agent
                                                                                                              • Figure 35: Consideration of experts/agents when booking a cruise, by age, August 2018
                                                                                                            • Showing flexibility in cruising could increase potential
                                                                                                              • Figure 36: Attitudes towards cruises – non-potentials, August 2018
                                                                                                          • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                              • Definitions
                                                                                                                • Abbreviations
                                                                                                                  • Consumer research methodology
                                                                                                                    • CHAID analysis methodology