Luxury travel is being taken over by the young and rich

You may not think of Millennials (aged 27-42), Gen Z (aged 11-26),
and Gen Alpha (10 and under) as luxury travellers, but think again.
These younger generations are rapidly becoming the dominant force in
high-end travel.

Candice D’Cruz, vice president of luxury brand management for Asia
Pacific at Hilton, revealed a staggering statistic: “By 2030, 80% of
luxury travellers are expected to come from these three generations.”

This shift in demographics is reshaping the luxury travel landscape,
and companies that fail to adapt risk being left behind. Here’s why
travel businesses need to pivot their focus towards these younger,
affluent travellers:

Growing spending power and priority on experiences

Unlike previous generations, these younger cohorts prioritise
experiences over material possessions. With increasing financial clout,
they’re willing to spend on unique, memorable travel experiences. As
Alan Watts, President of Asia Pacific for Hilton, noted, there’s a
growing trend towards “pop-up luxury” and off-the-beaten-track
destinations.

Demand for personalised, authentic experiences

D’Cruz emphasised that these travellers “are very unforgiving.
They’re very well travelled, and they want to make sure that surprise
and delight and connection is kept at the forefront of everything that
brands do.” This demands a new level of personalisation and authenticity
from travel providers.

Tech-savvy travellers seeking offline connections

While digitally native, these generations paradoxically seek special,
offline experiences when they travel. Travel companies need to strike a
balance between leveraging technology for convenience and offering
unique, tangible experiences.

Evolving travel preferences

Several key trends highlight the changing preferences of young luxury travellers:

• Multi-generational travel: Particularly popular among Asian travellers, with families travelling in three-generation groups.
• Wellness and mindfulness: Programmes like sleep therapy at Conrad Bali cater to the desire for rejuvenation and self-care.
• Culinary experiences: Immersive, story-driven dining experiences are highly valued.
• Non-alcoholic options: There’s a rising demand for sophisticated, non-alcoholic beverages.
• Sustainability: Eco-friendly initiatives are increasingly important to these conscious consumers.

Long-term customer loyalty

By engaging with younger luxury travellers now, companies can build
brand loyalty that may last for decades. As these generations accumulate
more wealth and travel more frequently, early adopters will have a
significant advantage.

How travel companies can adapt

To capture this lucrative market, travel companies should consider the following strategies:

1. Offer unique experiences: Partner with providers to offer exclusive, authentic experiences that can’t be found elsewhere.
2. Embrace sustainability: Implement and prominently feature eco-friendly initiatives.
3. Leverage technology: Use digital platforms for
   seamless bookings and personalised recommendations, but focus on
   creating memorable offline experiences.
4. Cater to wellness trends: Incorporate wellness and mindfulness elements into travel packages.
5. Foster cultural connections: Provide opportunities for travellers to engage meaningfully with local communities and traditions.

As D’Cruz succinctly put it, the goal is to ensure that “when a
luxury customer is thinking of luxury travel, they’re thinking of us.”
By recognising and adapting to the preferences of young, affluent
travellers, travel companies can position themselves for success in the
evolving luxury market.

The message is clear: the future of luxury travel lies with the
youths. Travel companies that recognise this imminent shift and adapt
their offerings accordingly will be well-positioned to thrive in the
coming decades.