The quickest and most effective way to successfully customize your luxury travel brand strategy is to understand your luxury traveler segments and address their needs specifically.
Heart+Mind Strategies is an insights, strategy, and activation consultancy with decades of experience performing original research and creating custom brand strategies for travel and tourism organizations instantly associated with luxury such as the Las Vegas Convention & Visitor Authority, Wynn Casino and Resort, Aria City Center, MGM National Harbor, Bermuda, and Mallorca.
RELATED: Heart+Mind’s Travel and Tourism Industry Experience
2 Types of Luxury Travelers
Across our research, we see luxury travelers fall into two broad categories:
1) High Net Worth (HNW) Luxury Travelers
First are the High Net Worth luxury travelers. These are likely the travelers that you envision when you think about luxury travelers. In Las Vegas, these are the whales. These travelers are typically a little older, have had their wealth for longer, and are seeking exclusive travel experiences.
Explicitly, they want the VIP experience and to be reminded that they are an elite individual with access to experiences that many simply don’t have. Implicitly, they’re also looking for permission to luxuriate; they want to feel like a brand reinforces the feeling that they earned their luxury.
2) HENRY Luxury Travelers
The real opportunity for brand differentiation exists with the HENRY (High Earner, Not Rich Yet) luxury traveler. You can think of this subset as aspirational luxury travelers. This traveler may have just got their first big promotion at work, have more discretionary funds than they’ve ever had before, and are looking for ways to introduce themselves to luxury for a special occasion.
If you’re unfamiliar with a HENRY traveler, imagine a man booking his first luxury weekend vacation to Las Vegas. This gentleman is in his 30s and recently accepted a new job where he has a salary of $125,000 annually. To celebrate, he books a $800/night luxury room at a high-end casino resort.
This gentleman also chooses to drive to Las Vegas to save money compared to airfare. While he has at least one nice outfit packed to go out to a nightclub, he arrives wearing athletic shorts and crocs. While he made a reservation at a steakhouse for later in the weekend, he immediately heads to McDonalds for lunch because he won’t be spoiling himself for every meal.
A HENRY traveler is going to be much more interested in experiential traveling where they can try new restaurants, shopping experiences, entertainment options, and hospitality accommodations. Additionally, a HENRY traveler isn’t looking to spend money for the sake of spending money. It’s essential that they balance a new luxury experience with a sense of value; while they paid a lot for the experience, they still feel that they got a great deal and can openly share the experience with friends and family.
The HENRY traveler segment presents the best growth opportunity within a brand strategy because every destination and travel brand have the capacity to accommodate their needs and the flexibility to experiment with customized branding that is fresh and unique.
How to Think About Your HENRYs
If you’re an established luxury destination, you should re-introduce yourself and build loyalty with the next generation of luxury travelers by having customized marketing and destination assets inviting HENRY travelers to trust you with their first investment to indulge themselves. For example, we’ve helped Las Vegas with numerous brand evolutions as they’ve highlighted gaming, live entertainment, an expansive culinary scene, professional sports, and globally prestigious events. These brand evolutions always offer fresh luxury experiences for a great value to both new and loyal Las Vegas visitors.
If you’re a destination that is not typically associated with luxury, you still have HENRY travelers in your existing visitor profile, and a thoughtful strategy of destination development and marketing with HENRYs in mind will help increase their daily average spend and repeat visit loyalty. Initially, your mix of luxury and non-luxury travel options will be part of the appeal.
The HENRY traveler can pick and choose the high-end dining, shopping, lodging, or entertainment options they value most, and can fall back on more affordable options to round out the trip. Additionally, as you build year over year capacity with your incumbent HENRY visitors, you can build the foundation of a long-term luxury brand that will appeal to more High Net Worth luxury travelers over time.
A Word of Caution
While it’s critical to invest in your luxury brand strategy now, be careful not to neglect your middle- and working-class segments outright either. The current economic conditions will reward a strategy geared towards luxury travelers, but an overinvestment in the singular approach can lead to long-term challenges once more travelers’ economic conditions improve.
If your brand, marketing, and PR strategy all over-emphasize your luxury offerings, you can start to be perceived as purely an expensive vacation option. Once perceptions harden that you’re an expensive brand, you’ll lose the middle- and working-class segments outright because they’ll assume they simply can’t afford you, and your HENRY segment will grow hesitant if they think they’re overpaying for an experience they can get elsewhere for a better value.
How to Update Your Luxury Travel Brand Strategy
Conducting research with a wealthy audience is notoriously challenging. Connect with us for an initial consultation and we can share our recommendations on how to organize your thinking and prioritize your needs.
KEEP READING: Luxury Traveler Part 1 – Your Luxury Travel Brand Strategy is No Longer a Luxury