Responding to changing consumer behaviour has seen the luxury travel market evolve to stay strong despite the recession.
With BA staff strikes, the Icelandic volcanic ash cloud, freak January snowstorms and ongoing issues with exchange rates, you can definitely spare a thought for those brands operating in the travel market.
But, as I heard at a panel discussion on the luxury travel sector at the World Travel Market exhibition in London recently, luxury travel operators are making the best of a bad time. They are responding to changing consumer behaviour and demand to ensure their brands stay relevant and perform strongly.
As April Hutchinson, editor of TTG Luxury magazine (Travel Trade Gazette’s quarterly special on luxury travel), observed, there is a new breed of luxury travellers who are looking to achieve “stealth status” rather than plain old wealth status. These are travellers who still have the cash to be surrounded by the finer things in life but have grown disillusioned with staying in five star hotels and eating in posh restaurants.
A new kind of traveller, the “stealth status seeker” is straying off the beaten path to snare a once in a lifetime, rare experience, Hutchinson says. While not luxurious in the same sense as fluffy bathrobes and drinking champagne in the back of a limousine, this type of traveller has become part of the luxury travel market in the sense that such a unique experience comes with a hefty price tag.
Kerry Golds, tour operations director for luxury travel operator Western and Oriental, says that she has noticed a trend in the clientele looking for more experience-led countries that haven’t previously been associated with offering luxury holidays.
There has been a surge in demand for “experiences” in Russia, Africa, Asia and Latin America, she explains.
Fellow panellist Andrew Loyd, director of Loyd and Townsend Rose, adds there is a new demand for destinations in Africa such as Syria, Libya and Ethiopia.
Gold adds that more luxury travel brands are responding to this trend by no longer producing old-school brochures, but more premium, coffee table style publications to reflect this burgeoning experience-led trend.
The new luxury traveller also wants to fill their time with more, says Alastair Poulain, co-founder of Original Travel. “People who are going on fewer holidays want to pack it with more, like three holidays in one,” he comments.
The company has picked up on the experience trend to offer luxury holidays with themes, such as diving in places like Oman and Mozambique; or music – jazz, flamenco, festivals, and The Beatles are all experience themes that Original Travel offers within its luxury proposition.
Like most other sectors, luxury travel brands have had to look at their market and understand how their customers’ behaviour can shape new innovations in product offerings. The effect of the recession is that consumers want more for their money. Poulain says his industry has had to respond to this by giving customers more for the same money.
Customer insight will have its biggest role to play in determining what those experiences should be, the level of luxury that still needs to be offered, and how to still retain a luxury price point.