After the global travel crisis following COVID-19, luxury leisure travel is leading the recovery. In a poll by Morning Consult for American Express, 61 percent of travelers said they would spend more on a trip in 2021 than they did in 2019. This likely stems from a pile-up of excess savings. According to the World Bank, households around the world have accumulated $5.4 trillion in savings above their average level.
How Luxury Travel Is Leading the Recovery
The recent pandemic has turned many travelers into high-net-worth individuals and made the super-rich even more so. According to GlobalData, which tracks the global travel market, 29% of respondents say their budgets are now higher than they were pre-pandemic. The luxury leisure industry is leading the recovery from the impact of COVID-19, with revenues from hotels and resorts increasing by 147% in 2021.
Luxury leisure travel is leading the recovery from COVID-19
While group business and corporate group travel have traditionally saved the travel industry, COVID-19 is no MICE market killer, unlike previous coronavirus outbreaks. Those who suffer from this virus will be the leisure travelers, who are likely to spend more than the business crowd. However, this recovery will take some time, particularly for hotels and cities dependent on foreign tourism. And the recovery from COVID-19 will take a long time for hotels and cities that depend on foreign tourist arrivals.
Despite the recent challenges in the international travel market, Reid is optimistic about the resumption of domestic and SMERF tourism. While international travel will be slower to rebound, destinations with domestic travel markets will have a quicker recovery. The weekend leisure segment should lead the recovery, driven by pent-up demand. This is especially true in China, which is experiencing record bookings despite the COVID-19 crisis.
Luxury leisure travel is leading
Airlines, cruise lines and travel companies must act now, before it becomes too late. The potential delay is high, but the opportunities are large for those who can adapt quickly. If the airline industry regains its footing, luxury domestic travel could be a bright spot for the entire travel industry. Meanwhile, U.S. millennials plan to spend more on luxury travel in 2021 than they do today.
Among the most popular destinations for vacationers, luxury cruises are a must. In fact, 61 percent of travelers intend to spend more on their next trip, according to a survey conducted by American Express and Morning Consult. Travelers will likely spend more than they do now due to the pile-up of savings. In fact, the global savings rate is up to $5.4 trillion, with a large chunk of that coming from high-income households.
After the global vaccine rollout, the recovery of the travel industry will depend on the speed of implementing the new regulations. The recovery will be more short-term and domestic in nature, with a smaller focus on international travel. Airlines, hotels, and travel agencies should take a new approach to promoting themselves on social media and other travel inspiration channels.
In addition, luxury travelers will likely have higher standards and are better equipped to deal with the unexpected. This is the reason they book luxury villas like Greek Villas for their stay so that can have all the amenities that they need. The recovery from COVID-19 is led by luxury leisure travelers, and this is good news for brands, as well. Luxury leisure travel is a growing segment of the travel market. Luxury travel has a reputation for being safe and comfortable, and it’s one of the fastest growing segments. It’s becoming a good time to take a break from your hectic work life and explore the world.
Middle East ticket sales are up 7% compared to pre-pandemic levels
Despite the ongoing crisis, airlines are still booking plane tickets, especially to the region. Qatar showed a 7% increase over pre-pandemic levels. UAE and Egypt followed, doing better against the region’s overall -33% decrease. The largest origin market for tickets to the Middle East is the UK, but US ticket sales are burgeoning, up +15 percent. This could be a new business opportunity for tour operators.
However, overall growth is only half of the rate before the 2011 Arab Spring, making it difficult to address the youth unemployment problem. There is still an ongoing threat of instability, which threatens to exacerbate the problem.
China is expected to lead the business travel recovery
Many business travelers are beginning to feel more confident about returning home after the recent virus outbreak. Low COVID-19 contraction rates and the continued progress in vaccination programs are helping to promote business travel. With the economy of China roaring ahead, this recovery is expected to begin in a number of Asian countries. Air travel and hotel bookings will also likely show signs of recovery, including China. But this recovery will differ across industries.
Creating a digital experience will be critical to achieving success in the Chinese market. Social and new media are becoming the most important sources of inspiration and information for travel decisions in China. Livestreaming is becoming a popular means of promoting travel packages, and some attractions are exploring “cloud travel” to boost their digital engagement and diversify revenue streams. A combination of digital tools and strategic collaborations is also expected to increase market penetration.
lead the business travel recovery
While global economic challenges remain acute, business travel is predicted to recover at a faster rate than expected. Higher inflation rates, capacity constraints, and labour costs will all increase costs worldwide.
Uncertainty still hangs over the travel industry, but there are a number of major developments that will either speed up the recovery or impede it. One such development is a recent report from Deloitte on the state of the industry. The report identifies several important factors that will help drive corporate travel to the next level. Among these factors are health and environmental concerns.
Despite the recent pandemic, China is continuing to lead the global economic recovery. The country’s economy grew at 2.3 percent in 2020 and 12.7 percent in the first half of 2021. In the meantime, it’s important to ensure that the government does not allow foreign business travelers to travel to its territory until the situation improves in other parts of the world.
In addition, travel companies that focus on this domestic market will have an edge over the competition. So, in short, it’s time for the travel industry to think outside the box.