Over 4,000 luxury travel industry representatives - 1,818 suppliers and 1,927 travel advisors, a record number - attended Virtuoso Travel Week in Las Vegas this past week.
The record-breaking numbers belie the fact that luxury travel is thriving: by some estimates, high-value travelers account for over 50% of global travel spend.
The conference, which exists to connect travel suppliers to travel advisors in thousands of 4-minute meetings, surfaced some trends in the luxury travel space. These trends are of interest to any organization looking to capitalize on the growth in the space, and to deliver products targeted at the luxury traveler and the vast ecosystem that exists to serve them.
Some of the visible trends are continuations from industry-wide trends, but also highlight just how specialized many travel suppliers are becoming in their pursuit of both market share and revenue growth.
The rise, resurgence and/or longevity of the travel agent
"The travel agent is dead, long live the travel agent" has been the common refrain from industry pundits since the rise of the OTAs threatened the traditional travel agent retail business. While agents most definitely took a hit over these years, the trend is swinging back towards the agent - some on Tnooz have pointed to the longevity of travel agents for years to come.
Alternatively known as a travel advisor or travel consultant, the role of an actual human being is becoming ever more treasured as the information explosion continues to overwhelm the typical Internet research session. Cutting through the noise is difficult, and thus those services and technologies that facilitate this curation are valued highly.
The record attendance at Virtuoso's Travel Week shows a continued interest in travel agents in the luxury space. Of course, this is a much more obvious state of affairs, as the traveler-of-means is more likely to both see the value in time-savings (and thus not balk at paying related fees) and to seek informed counsel to tailor a trip specifically to the traveler's specifications.
Virtuoso CEO Matthew Upchurch, from the stage during the opening session, boasted about the resilience of the travel agent profession.
Our focus has always been to leverage technology to enable deeper, more meaningful interactions, rather than replacing humans. Even before social media, our focus was on connecting people. We have to first focus on the value of people...you can't take the human out of humanity!
And with reported revenues of $9.6 billion in 2010, Virtuoso is clearly succeeding.
Our market share is holding up very well. There is a growing realization about the quality versus quantity, and the relative value of different revenue sources from distribution options. The value of advisor bookings is indisputable, and the intelligent management of a multi-channel world is maturing nicely.
Other technologies are emerging to provide concierge-style service to leisure travelers not necessarily looking to pre-plan and book via a traditional travel advisor. And perhaps the feeling of younger Millenials is that they can just figure out what to do on their own - given the sheer amount of information online, this is both realistic and challenging.
These technologies emphasize the fact that personalized advice will always be held at a premium by travelers, and as travel gets more complicated, travelers will be willing to pay to curate the world's offerings. By recognizing this trend, travel startups and established startups should consider how personalized travel advice and booking help.
Upchurch himself realizes this technological challenge - and also points out ASTA's recent report that only 2% of travel agents are in the 18-34 demographic.
This either represents an opportunity, or confirms that younger folks are just not as interested in travel advisors. Most likely, price-sensitive folks under 30 are not able to rationalize paying an agent, but as they increase income and responsibilities into their 30s, they begin to see the curatorial value of an advisor.
Special interest travel
Travel companies have been addressing the personalized travel trend for many years. With new technologies, travel startups have also been consistently offering up ways for travelers to both customize their trips before leaving and to secure individualized experiences while in-destination.
By focusing on particular niches, companies are compiling targeted experiences that offer a more high-value to both the traveler and the company. While this is not necessarily new, the recent consumer trend towards experiences over stuff has led many travel suppliers to diversify their offerings with exciting and/or educational programs that can be marketed directly to a demographic.
There are no shortage of demographics aggressively being targeted in the luxury market: LGBT, culinary, sport, spiritual, religious, historical...basically any sort of interest can be catered to with customized itineraries that bring higher margins as customers value the curatorial aspect provided.
With organizations popping up supporting adventure travel, LGBT travel, and all kinds of niches in between, this trend exists industry-wide. For luxury travel suppliers, this represents an opportunity to repackage and specifically curate products for moneyed special interest travelers.
Noteworthy exclusive experiences
One of the areas where Virtuoso's extensive network thrives is in curating a selection of experiences only available via the Virtuoso travel network. Of course, this is not limited to Virtuoso - exclusive experiences are touted from companies across the travel spectrum, from Groupon to Events in the Sky.
What's happening here is that in-person, face-to-face experiences are rising in prominence as the keys to a memorable trip. Rather than simply shopping or purchasing goods, travelers of all kinds are seeking special experiences that are not necessarily widely available. Both for personal growth and social media sharing, these experiences are becoming ever more valuable to those who consume them.
And for luxury, this means highly exclusive access to places others generally cannot go - such as NoteWorthy's private access to Highclere Castle (of Downton Abbey fame) or a private viewing of non-public areas of the Tower of London. For the right price, anything is accessible.
The imperative of these sorts of curated experiences is only slated to grow, as the world becomes more and more traveled. Since there are not necessarily new destinations to discover, the new status currency will be what experiences are able to be accessed - and how exclusive and rare they really are.
Living like a local, perhaps in private residences
"Living like a local" continues to be one of the most played out phrases in travel. However, for the luxury traveler, there is a new meaning to this phrase - especially when you consider the scale of private residences available for short-term stays. Countless startups offer luxury residences, from Inspirato to exclusive rental brokers, and many offer access to former private residences that have been converted to 5-star resorts (like the K-Club).
Bespoke concierge services like Quintessentially are thriving, as they direct luxury travelers to the most precious activities, restaurants and events. Time has become the ultimate commodity, and those in the money have realized the importance of help in determining the when, why and how of their trips - preferably from a local perspective.
The takeaway here is that access and authenticity are rapidly becoming the key variables in the travel equation. It's not just a new destination, a nice hotel or a tasty meal,
Health and wellness travel
The final trend that is informing the selection of activities and trip types by luxury travelers is a move towards health and wellness travel. It's no longer just about getting away to a remote beach. Healthful activities and food are now being sought out - and not necessarily adventure travel. New spas, healthier menus, excercise, yoga and various levels of personal growth and health are now becoming core components for affluent travelers.
Adventure travel is booming, but don't underestimate how much some people want to be healthier on the road than they are at home. A spiritual journey could be a very significant driver to travel, and this trend is being seen across the board in investments in renewed food programs, spa renovations and general access to a more healthful slate of services and activities across the supplier ecosystem.
Overall, these trends mirror much of what is going on industry-wide. It's important to note that luxury travelers are primed to pay handsomely for a perceived increased value in health, wealth and unique access.
NB: Sailboat image courtesy Shutterstock.
NB2: Accommodation expenses covered by Virtuoso.