Affluent travelers are often targeted by travel brands due to their huge spending power. Making assumptions about this segment based purely on their high incomes, however, is likely to be a mistake.
For travel brands, targeting affluent Americans is a strategic decision with the potential to have a huge payoff. According to Skift Research’s analysis of data from the Bureau of Labor Statistics’ 2016 Consumer Expenditure Survey, while Americans who make over $100,000 in household income comprise just one-fifth of the population, they contribute over half of all travel expenditure.
Our latest research report, U.S. Affluent Traveler Trends 2018: Annual Survey on Travel Behavior, provides a deep dive into this group’s travel behavior and preferences. Analysis of the results of this year’s U.S. Affluent Traveler Survey offers a closer look at the group as a whole. We we find that they prioritize unique experiences while traveling and are increasingly embracing alternative accommodation options. And while they would rather spend money on travel than on other things, they don’t think that spending more makes a trip more meaningful.
Further segmentation according a few key characteristics helps us understand the variation in the group. Those with children, for example, are staying in, and preferring, alternative accommodations more than their peers without children. Older affluent travelers seek travel experiences that can teach them new things, while their younger peers hope to reach personal goals or gain different perspectives about the world through travel. Ultimately, while affluent travelers exhibit some important commonalities, it’s essential to understand the complexity of the group in order to appeal to them in ways that resonate the most.
Last week we launched the latest report in our Skift Research service, U.S. Affluent Traveler Trends 2018: Annual Survey on Travel Behavior.
Below is an excerpt from the report. Get the full report here to stay ahead of this trend.
“Despite their common traits, we recognize that the Affluent Traveler group encompasses a diverse group of people with more nuanced behavioral and attitudinal differences. To understand variation within the group better, we compared results of three more specific household income brackets: $100,000-$149,000; $150,000-$199,999; and Over $200,000. For simplicity’s sake, we gave these groupings their own names: Emerging Affluents, Mainstream Affluents, and Super Affluents, respectively. We were most interested in comparing the Super Affluent group to its less-affluent peer groups due to this group’s potent spending power. According to Skift Research’s analysis of the Bureau of Labor Statistics’ 2016 Consumer Expenditure Survey data, Super Affluents account for 22% of all yearly U.S. travel expenditure, or $7,400 per person. In comparison, Mainstream Affluents account for 12% of total travel expenditure, or $4,400 per person; and Emerging Affluents (which include about twice as many people as Mainstream Affluents) account for 17%, or $2,700 per person.
Given their high expenditure, it is logical that the Super Affluents in our survey are the most frequent travelers and the most likely to travel internationally compared to the other groups. They are also more likely to partake in adventure travel and organized tours and activities. This group is also the most likely to splurge on hotels and to stay more often in luxury hotels, further illustrating the place of luxury hotels in the market, even as the definition of luxury is expanding beyond accommodations.”
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Photo credit: A couple looks out a window at a cityscape. Affluent travelers prioritize unique experiences when traveling. Alban Martel / Unsplash