MENA region leads global growth in luxury travel
May 28, 2024 | By Amnah Ajmal
When economists charted the sectors that are leading recovery, travel emerged among the largest and fastest. Especially in the Middle East, luxury travel is picking up steam. Globally, the luxury travel market is expected to grow at a compound annual growth rate (CAGR) of 7.9% until 2030. And the Middle East region is playing a major part in driving that growth, both in terms of outbound and inbound travel, given the high quality of luxury hospitality experiences in the region.
Our latest report Affluent Travel: A Middle East Perspective highlights the role of the Middle East and North Africa (MENA) in driving growth in affluent travel. While much of the world is barely touching pre-pandemic levels, MENA is the only region to show arrivals 22% above 2019. The top five most visited cities in the region include Istanbul, Dubai, Cairo, Jeddah, and Marrakesh.
High-net-worth travelers contribute approximately 36% of the global spend on travel and nearly 70% of the spend on luxury travel.
The study also notes that more than half of affluent travelers prioritize experiences over physical goods. Meanwhile, nearly a quarter are willing to pay more for remote destination experiences, customized tours to connect with local culture and eco-friendly resorts.
The appetite for new experiences in unexplored destinations, micro-trips and a maturing tourism offering will drive the growth of the global luxury travel market, estimated at $1.38 trillion in 2023.
Luxury-seekers are digitally savvy, with 74% booking travel online. However, they also want their money’s worth in the form of exemplary customer service and pampering. Meanwhile, the combination of business and leisure, or ‘bleisure’, is resulting in more remote-work trips as digital nomads change the face of travel.
As wealth migrates to younger generations, Millennials now comprise the highest percentage of luxury-seekers, followed by Gen Z. Within the GCC, however, Gen X is expected to make the highest contribution to travel growth.
Affluent travelers place a premium on authentic eco-luxury experiences. A significant 38% of this discerning segment are willing to pay between 30% and 50% more for sustainable travel features such as energy-efficient solutions.
To get all the insights, you can read the full report here.
