PHOTO: The Virtuoso study showed millennials to be more brand loyal and looking for experiential tours when it comes to luxury travel. (ThinkStock)
Virtuoso, the luxury travel network, released findings from a new study on affluent generational travel at its annual Virtuoso Symposium in Hong Kong. The group analyzed transactional data from its U.S. and Canadian-based agency members spanning more than six years and totaling more than $35 billion in sales.
Virtuoso analyzed spending habits of four distinct generational groups: Millennials, Gen Xers, Baby Boomers and Matures. It then layered this information with input from focus groups, interviews with its own travel advisors, and studies from research partner Wealth Engine.
Using that data and research, Virtuoso uncovered a number of trends for each generational group. At the same time, Virtuoso executives say each group is a potentially lucrative source for booking luxury travel. Here's a rundown of the trends for each generation:
Millennials: Virtuoso found that this group, age 22-32, can make great luxury travel clients, if selected carefully. Roughly 90 percent of them book travel online and at the very least 87 percent use online travel agencies (OTAs) for research and rate comparisons, but that also means they represent real opportunity for traditional travel advisors.
Their average daily spend is 62 percent lower than Matures, but that gap closes to just 24 percent when specific Millennials are targeted who truly desire a luxury travel experience and like individual service. Millennials also are actually more loyal than other generations to specific travel brands.
As the "me" generation, Millennials expect to be serviced differently. They are time suppressed and over-stimulated with a general philosophy that a smartphone can solve any problem. But if they are engaged, educated about the travel options available, they can be converted into good luxury travel customers.
Millennials also strongly favor customized FIT tours and experiences. Given they are still building their careers and likely have less ability to break away from their jobs, they have a higher propensity to book trips within North America.
Gen Xers: This group, age 33-49, is the least loyal, perhaps because they came of buying age when online travel agencies (OTAs) were in ascendency. They shift loyalty from brands in favor of price shopping, with 82 percent booking travel online and 71 percent researching their travel through OTAs.
On the other hand, Gen Xers account for the highest average daily spend while traveling at $627 per day. By comparison, Millennials average $527 per day, Boomers average $522 and Matures average $471.
Changes in Gen Xer life stages are strongly reflected in their travel habits. Their offspring (Generation Z) strongly factor into travel decisions and schedules, with school calendars largely dictating timing. Their top vacation motivation is having enough time to relax and unwind.
Gen Xers favor resort stays, especially in such areas close to home as the Playa Del Carmen region of Mexico. They prefer to stick closer to home, which means Mexico is a favored destination.
Baby Boomers: Eighty-four percent of this group, age 50-68, admit to having purchased travel online and 72 percent have researched travel through OTAs, but they also are responsible for the greatest travel spend. This is mainly because they make up the highest concentration of "ultra-affluent" consumers, meaning they have investible assets in excess of $25 million.
Boomers are experiencing a big point of transition as they retire, and travel ranks among their top activities. Their average spend on travel remains relatively constant before growing rapidly again after age 65. They prefer more diversity in their travels, with 19 percent favoring hotels, 26 percent preferring cruises and 28 percent opting for customized FIT tours.
Matures: Travel factors significantly in the lives of this generation, age 69-89. Indeed they rank as the highest spending travelers in aggregate. They favor cruises, especially in January. Unlike Gen Xers, whose cruising schedules follow school holidays, Matures cruise throughout the year. Their loyalty remains the highest as well, since they are the most likely to repeat their travel purchases on the same products.
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