Luxury Travel Market Size & Trends Analysis by Grand View Research

The global luxury travel market size was estimated at USD 1.38 trillion in 2023 and is expected to grow at a CAGR of 7.9% from 2024 to 2030. Increasing spending by elite travelers to visit unexplored destinations and gain new experiences is driving the market growth. In addition, the rising trend of micro trips and the rapidly expanding tourism sector across the globe have been boosting the market growth.

Personalized services, reliable transport, exclusivity, and positive & professional interaction with staff is what sets the benchmark for luxury travel. Traveling around the world is being greatly influenced by favorable factors such as growing political stability, improving attitude toward gender, ethnicity, sexual orientation, and race, and more accommodating visa regulations. Travelers are looking to create their own unique experiences through flexible itineraries that combine entertainment as well as relaxation.

An increasing number of travelers are opting for tours of their preferred destinations due to the desire to learn more about the place that they are visiting. Luxury travelers often prefer customized and private tours to general tour packages for unique and highly personal experiences. The post-pandemic trends of private tours due to concerns for health and safety are driving the luxury travel market. Customized and private tours let people travel with their friends and family at their own pace. For instance, according to a TripAdvisor survey, the fastest-growing tours are family-friendly ones. Bookings for these tours increased by over 200% in 2021, and 291% for U.S. travelers.

The growing population of high net-worth individuals (HNWIs) across the globe and this group will be one of the most crucial travel groups that will help bring the industry on track and is expected to propel market growth over the forecast period. According to the World Wealth Report 2022, the total HNWI population was pegged at expanded by 7.8%, and wealth swelled by 8% in 2021.

Market Concentration & Characteristics

The market growth stage is medium and the pace of growth is accelerating. The degree of innovation is high in the market owing to the variety of customizable and comprehensive journey packages offered by the service providers. In March 2021, Travelive, a luxury travel company with offices in the U.S. and Europe, announced the official addition of Croatia to its portfolio of destinations. Travelive will now provide full-service for foreign independent travel (FIT) itineraries, shorex, pre and post cruise options, specialized guide services, private transfers and 24-hour client support across Croatia. Such initiatives are expected to propel the customized and private luxury travel market growth over the forecast period.

Age Group Insights

Luxury travelers in the age group of 41-60 years contributed to the global market with a revenue share of 42.67% in 2023. These consumers have the time, budget, and desire to travel and visit multiple adventurous destinations due to no-child responsibilities, and a wide bucket list ranging from taking a world cruise, a long vacation on a luxury cruise liner, exotic ports, enjoying an upscale safari destination is accelerating the market growth. According to AARP 2021 Travel Trends’, In the U.S., approximately 54% of baby boomers planned to travel in 2021, on which they planned to spend an average of USD 6,691, which is about 20% to 50% more than their Gen X or millennial counterparts.

Market revenue from luxury travelers in the age group of 21-30 years is expected to grow at the CAGR of 7.9% over the forecast period from 2024 to 2030. Millennials have a mindset for luxury and its meaningful consumption. They tend to be more independent in their religious and political views, more entrepreneurial, less likely to be married, distrustful of authority, better educated, and more travel-oriented than any other generation. This may fuel the market growth over the forecast period.

Full Report by Grand View Research