Travel habits of young vs. old and new wealth vs. old wealth
As the world gets richer its people spend more on luxury. Consider that people spent $1.8 trillion on luxury goods and services worldwide in 2012, (the most recent year for which these statistics are available).
More than half of that amount, nearly $1 trillion, was spent “luxury experiences,” and travel and hotels accounts for half of that, according to Boston Consulting Group.
That amounts to about $500 billion spent globally on luxury travel and lodging in a single year, but who’s counting?
Boston Consulting reports that spending styles among luxury consumers differs by age and whether they were born into wealth or they built their fortunes. The young and newly rich tend to buy visibly costly items that will impress their peers. By contrast, those born into wealth are more likely to value quality over bling.
Chris Fair, of the consulting firm Resonance, was recently paraphrased in The Economist magazine saying that when rich 20-somethings travel, they tend to be drawn to gregarious pleasures that can be shared on social media with their friends. But plenty also view vacation as a time to learn something and broaden their cultural horizons.
The established wealthy spend their travel dollars more traditionally, tending to stay at five-star luxury hotels. The luxury hotel business, however, has become commoditized and operates far differently than an independent boutique lodging establishment such as The Rose Hotel. One of the differentiating factors is a more stylized environment and more personalized service.
Boston Consulting also points out that the established rich, because they own so much in the way material goods, place a high value on doing or feeling something new. They claim to experience three times the emotional reward from an experience when compared with owning something with the same financial value.
We can report the same. Not because we have done empirical research, but because we see it in our guests’ faces every day.
Written by Mike Consol