Las Vegas â Despite rising prices, the luxury travel sector is experiencing a surge in demand, with Virtuoso member agencies reporting significant increases in business compared to 2023. This trend was highlighted at Virtuoso Travel Week, where a panel of travel advisors discussed the current state of the industry.
Carolyn Addison, Head of Product at Black Tomato in London, reported a 15-16% increase in sales year-on-year. Similarly, Fernando Gonzalez, CEO of First in Service in New York, revealed that the agency doubled its pre-pandemic sales figures by mid-2023 and continues to see double-digit growth this year.
Cathy Holler, President and CEO of Momenti Travel in Canada, noted a doubling of business compared to last year, attributing the success to post-pandemic momentum and a large number of last-minute, high-end bookings. Roland Howlett, Director of Australia's Frontier Travel, also reported an increase in business driven by rising client numbers and travel advisor engagement.
While clients are acknowledging the price increases, they remain willing to spend on luxury experiences, but with a heightened focus on value. "They're spending the money still," said Gonzalez. "I think what is different than beginning or mid-pandemic is that they are looking for value? 'I'll spend the money, but why am I spending the money?'"
To address this shift, many hotels are bundling inclusions into their daily rates. Despite sticker shock, clients are often willing to move past it and proceed with bookings, according to Holler.
Addison noted that Black Tomato is steering clients towards less popular destinations in some cases, driven by both pricing and availability concerns.
The panel also discussed current travel trends. Holler highlighted the surge in last-minute, high-end bookings, leading to challenges in destinations with limited availability, particularly for guides and drivers. Howlett pointed to growing interest in exploring secondary locations and alternatives to popular hotspots.
Addison expressed optimism regarding the increasing desire for travel during off-peak seasons, citing the potential for improved client experiences and benefits for suppliers during shoulder-season bookings.
Gonzalez reported a significant shift towards group travel in both the corporate and leisure sectors. "It's shifted the dynamic of our company," he said. "We hope that it maintains."
Overall, the luxury travel sector is experiencing a robust rebound despite price increases. Clients are willing to spend, but value for money is paramount. Travel advisors are responding by focusing on providing curated experiences, alternative destinations, and flexible booking options. The trend towards group travel adds another layer of complexity and opportunity to this dynamic market.
