Please note that this group defines affluent is really aspirational upper middle class. Just the fact that it talks about commercial flights instead of private jets etc, but it does give interesting information about the effects on the Mass Luxury client.
The long-range forecast for the luxury travel sector now through 2010 is mixed -- Bright and sunny for travel providers catering to the pleasure market, with storms and changing winds ahead for marketers that rely primarily on the business travel segment. This according to a new trend report published by Unity Marketing entitled Forecast for Luxury Travel Through 2010: A Luxury Trend Report. It is based upon the results of a survey conducted in October 2-7, 2009 among 1,067 affluent consumers (avg. income $228,800).
Pam Danziger, president of Unity Marketing, says, "So far in Unity Marketing's quarterly luxury tracking study, the luxury travel sector has been one of the categories slower to recover from the recession. The data shows that the recession for affluent consumers bottomed out at the end of third quarter 2008, but so far spending on luxury travel is down 22 percent for the first three quarters of 2009 as compared with same period last year. In effect, luxury travel was slower going into the recession, and is slower coming out."
More business travel planned on reduced budgets – That means budget, discount, value are key words for travel providers that cater to the business market through 2010
The survey which looked at both the business and personal travel plans among affluent consumers (80 percent of whom are employed) found that while over 75 percent of business travelers expect to spend less or the same on business travel over the next 15 months, they will actually be increasing the pace of business travel.
Danziger explains, "Net/Net: The research findings point to a modest increase in planned business travel, as a greater share of the market's most active travelers expect to be on the road more through 2010. But they also expect to spend less on that travel. 'Road-warriors' in the short term will be looking for value from the travel brands they patronize. The research finds they want more budget and business class hotels and budget, lower cost dining options. Low on their list of business travel priorities through 2010 are dining in five-star restaurants; first-class air fare; or staying in five-star hotels."
Affluents traveling for pleasure are likely to trade up to luxury level
The prospects for luxury travel through 2010 is more positive for the personal travel sector than business travel. The survey finds that when affluents travel for their personal pleasure, they are far more likely to move up-scale to the four- and five-star accommodations that they have come to enjoy over the years. Danziger explains, "A trend toward increased spending on personal travel is noted in this survey. In the coming year luxury travel providers will be serving fewer business guests whose companies have put those brands on the forbidden list. Rather they must focus on services directed toward the primarily pleasure travel market."
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