PORTLAND, OR—The global luxury travel market garnered $891.1 billion in 2018, and is expected to reach$1.614.6 billion by 2026, growing at a CAGR of 7.9% from 2019 to 2026, according to an Allied Market Research report entitled “Luxury Travel Market by Type of Traveler (Absolute Luxury, Aspiring Luxury and Accessible Luxury), Age Group (Millennial, Generation X, Baby Boomers and Silver Hair), and Type of Tour (Customized & Private Vacations, Adventure & Safari, Cruise/Ship Expedition, Small Group Journey, Celebration & Special Events and Culinary Travel & Shopping): Global Opportunity Analysis and Industry Forecast, 2019–2026.”
Prime Determinants of the Market
Rise in the inclination toward exotic holiday experiences, a surge in middle and upper middle-class spending, the trend of online booking and the increase in impact of travel industry drive the growth of the global luxury travel market. However, varying socioeconomic situations and the impact of natural disasters hinder the market growth. On the other hand, demand for enhanced service standards and the emergence of new destinations create lucrative opportunities in the industry.
Adventure and Safari Segment to Maintain its Leadership Status by 2026
Based on type, the adventure and safari segment held the largest share in the global luxury travel market in 2018, accounting for more than two-fifths of the total share, and is estimated to maintain its leadership status during the forecast period. This is due to inclination toward transformative and engaged activities. On the other hand, the culinary travel and shopping segment is expected to register the largest growth rate with a CAGR of 9.7% from 2019 to 2026, owing to a surge in outbound travel, eagerness for gaining unique dining experiences in various countries and the organization of many festivals and events.
Millennial Segment to Grow at the Highest Growth Rate
Based on age group, the millennial segment would grow at the largest rate with a CAGR of 9.5% from 2019 to 2026, owing to inclination of millennials toward wanderlust and breaking life’s monotony, short trips to culturally rich and different countries, and local shopping. On the other hand, the baby boomer segment accounted for around two-fifths of the total market share of the global luxury travel market in 2018, and is estimated to maintain its highest contribution during the forecast period.
North America to Grow the Fastest
North America is estimated to register the fastest growth rate with a CAGR of 11.4% from 2019 to 2026, owing to an increase in international spending on travel, availability of ranches and spa retreats to private islands, and the presence of established and highly exclusive resorts. However, Europe held the major market share, accounting for nearly two-fifths of the total share of the global luxury travel market in 2018, and is expected to maintain its leadership status during the forecast period. This is attributed to the preference for customized and private vacation and cruise/ship expeditions and the surge in number of travelers in countries such as Greece, Spain and Turkey.