With an average annual growth of 4 percent, the luxury market will play a crucial role in the future of travel requiring the hospitality sector to keep abreast of new demands, according to an industry report presented by hotel, tourism and leisure consultants Horwath HTL and Soul Luxury.
The Asian and North America regions are primary drivers of this growth, according to the “Rethinking Luxury in Hospitality” report, which goes on to add that in the previous period, luxury travel grew faster (4.5 percent) than overall travel (4.25 percent) with forecasted growth rate of luxury travel higher at 6.2 percent than overall travel (4.8 percent).
This growth spurred an increase in competition, due to an increase in the number of luxury properties and to improvements in the service delivery to luxury guests in existing operations.
Key findings of the report indicate that luxury hospitality is undergoing an evolutionary shift driven by changes in lifestyle habits and digitization. Travelers are now seeking a more transformative and soul-enriching experience – dubbed by industry experts as the “New Luxury in Hospitality”. Analysts point out that hoteliers must now focus on the emotional impact of the experience which in turn is in direct relation to brand engagement.
According to the report’s analysts, luxury travel must now function as a transformational experience. To achieve this five factors must be in place: Purpose: as customers are now seeking a better, more fulfilled lifestyle, turning their backs on spending on superficial brand experiences; Personalisation: brands should develop a genuine interest in the guest’s lifestyle to create an understanding of preferences; Experiential: a focus on the emotional value and the potential to transform; Balanced Disconnection: ensuring a balance between digitally intensive and digitally aversive experiences; and Seamless Journey: impeccable service backed by new methods and technologies.