Luxury Travel in 2025: Q1 Update

Distinct trends are shaping high-end travel experiences across the globe. From extravagant styles to sustainable practices. Here’s a Q1 look at the key developments that will be important to track in 2025:

The Global Shift: From Quiet to Loud Luxury

Perhaps one of the most interesting developments is a global shift from quiet luxury. Numerous publications have now written about a new bold, head-turning fashion adorned with striking colors and prominent logos. In 2025 we will see Loud Luxury, where self-expression and status take center stage. Meanwhile, technology is weaving itself seamlessly into the fabric of luxury. We are likely to see some adaptations in travel offers too to cater for that creative self-expression.

Key Markets: America, Europe, and China

US

The top 10% of earners—households making at least $250,000 annually—now account for nearly half of all consumer spending, the highest proportion in 35 years. Between September 2023 and September 2024, their spending surged 12%, contributing to roughly one-third of global GDP.

In the U.S., the luxury scene is all about experiences. The top 5% of earners are driving this trend, splurging on international trips as well as shopping while abroad, as reported by Bank of America Global research (see charts below). And it’s not just the wealthy—millennials and Gen Z are redefining luxury, prioritizing personalization and sustainability over traditional status symbols.

Europe

Europe is embracing a different kind of luxury. In Paris, a young professional browses a secondhand luxury boutique, hunting for a unique vintage handbag that tells a story. This is the booming secondhand market, fueled by sustainability and a desire for individuality. At the same time, a new wave of Neo Luxury is emerging—think mindfulness retreats in the Swiss Alps, where digital detox meets traditional opulence. Established brands like LVMH and Hermès continue to thrive, proving that even in uncertain economic times, luxury endures.

In the UK, the proportion of higher-rate taxpayers (earning above ￡50,270) is expected to climb to 16.9% in 2024-2025, up from 13.4% in 2021-2022, largely due to wage growth in upper-income brackets and frozen tax thresholds. Despite a projected slowdown in private sector salary growth (dropping from 6% in 2024 to 3% in 2025), public sector salaries are forecasted to rise between 4.75% and 6%.

Meanwhile, discretionary spending among affluent consumers remains strong, with non-essential spending growing by 2.7% in January 2025 alone. Health and beauty expenditures saw a particularly sharp rise (10.7% year-over-year), reflecting the sustained interest in wellness and self-care.

China

In tier-one cities like Shanghai, affluent consumers are gravitating toward understated, high-end brands that emphasize craftsmanship and heritage. Meanwhile, a younger, price-sensitive demographic is embracing accessible luxury, seeking out stylish yet affordable options. Both groups, however, share one thing in common: a demand for seamless digital experiences. From personalized shopping apps to virtual showrooms.

Which trends are likely to accelerate?

Gig-Tripping

Affluent travelers are increasingly planning their trips around major sporting and entertainment events, a phenomenon known as "gig-tripping." This trend is particularly strong in elite sports such as tennis, polo, horse racing, golf, and Formula 1, where high-net-worth individuals seek premium experiences beyond just attending the games.

• Tennis: Events like Wimbledon and the US Open draw ultra-wealthy spectators who enjoy VIP hospitality, private lounges, and courtside access.
• Polo: Known as the "sport of kings," polo tournaments such as the Argentine Open and Dubai Gold Cup offer attendees access to exclusive after-parties and networking events with the elite.
• Horse Racing: Iconic events like Royal Ascot and the Kentucky Derby cater to luxury travelers with private boxes, bespoke fashion experiences, and high-stakes betting.
• Formula 1: The Monaco Grand Prix and Singapore Grand Prix provide guests with yacht hospitality, VIP paddock access, and exclusive gala evenings.

Golf also remains a favorite among high-income individuals, with data showing that those earning over ￡100,000 annually are twice as likely to follow the sport as those in lower income brackets. The demand for elite sporting events is fueling a niche market in luxury travel, where exclusivity and premium experiences take center stage.

@GSIQ Tourism Insights new report due to be published in March will reveal that when it comes to appealing messages, affluents over-index for good value and good quality ticket, travel and accommodation packages, as well as finding out more about the local culture, environment and other activities and attractions at the destination. They are also keener than others to combine their trip with other favourite activities. A lack of quality accommodation is the most off-putting factor.

Hyper-Personalization

This demand is especially prominent among Gen Z and Millennials, who have grown up in a world of tailored digital experiences. As a result, they prioritize:

• Flexibility over traditional luxury, favoring unique destinations and customized experiences.
• Real-time itinerary adjustments based on preferences, schedules, and location.
• AI-powered travel recommendations informed by data and past behaviors.
• Seamless digital booking experiences that minimize friction from planning to execution.

The Rise of Hidden Gems

While traditional luxury destinations remain popular, there is a growing shift toward secluded, off-the-beaten-path locations. Some of the most in-demand regions include:

• UK Countryside (+173% increase in bookings), with travelers seeking private estates and heritage manors.
• Portugal’s Algarve Region (+110% surge), attracting those in search of unspoiled coastal beauty.
• Greece’s Athenian Riviera (+132% rise in average daily room rates), blending history with luxury seafront stays.

Luxury Cruises

Luxury cruises are experiencing a 21% year-on-year increase in bookings, with destinations like Croatia’s Dalmatian Coast gaining popularity. Modern high-end cruises offer unparalleled levels of privacy, adventure, and bespoke experiences, catering to travelers who want an all-encompassing luxury escape.

Wellness Tourism

High-end wellness retreats are expanding beyond spas to incorporate personalized fitness training, longevity programs, and immersive nature-based therapies. This movement aligns with the rising trend of health-conscious luxury travelers prioritizing holistic well-being over material opulence.

Extended Stays

Luxury travelers are embracing longer vacations, with the average stay lengthening from 9 days in 2022 to 14 days in 2024.

Multi-Generational Travel

Families are investing in elaborate vacations that cater to all ages. Luxury resorts are adapting by offering curated family programs, private villa accommodations, and tailored concierge services. New properties opening this year will aim to match expectations through:

• Personalized Stays: AI-driven room settings and tailored itineraries.
• Wellness and Mindfulness: Meditation, breathwork, and nature-immersive activities.
• Sustainability Initiatives: Solar panels, water recycling, and zero-waste dining.
• Adventure and Exploration: Curated local experiences, from guided tours to exclusive cultural access.

The luxury travel landscape in 2025 is defined by a blend of extravagance, sustainability, and personalization. As travelers seek unique, meaningful experiences, the industry is responding with innovative offerings that cater to evolving preferences.

For more in-depth research, please contact us at GSIQ