Record low levels of spending for both domestic and international vacation travel are suggested by the most recent survey in a series of twice-yearly studies that began in Spring 2002.
Negative attitudes about the current economy and the economic outlook for the next 12 months are contributing to plans for reducing vacation expenditures by affluent consumers during the next year, according to the Affluent Market Tracking Study #15 conducted by the American Affluence Research Center.
In the Spring 2009 survey of the wealthiest 10% of all U.S. households, plans to cruise during the next 12 months were reported by a record low of only 12% of the luxury consumers. Intentions to cruise have been as high as 22% (Fall 2007 survey) and has typically ranged from 15% to 19% since the inception of these surveys.
Spending for domestic vacations during the next 12 months, in comparison to their spending for such items during the past 12 months, is to be reduced by 30% of the affluent consumers and to be increased by only 13% of the affluent consumers. The remainder (57%) expects to spend the same for domestic vacations during the next year as in the past year.
Spending for international vacations is to be reduced by 44% of the affluent consumers and to be increased by only 13% of the affluent consumers. The remainder (43%) expects to spend the same for international vacations during the next year as in the past year.
To reduce domestic vacation expenses, the affluent are most likely to take fewer trips and to stay in less expensive accommodations compared to the prior 12 months. Fewer trips will be the primary method for reducing international vacation expenses compared to the prior year.
The survey respondents indicated a negative 12 month outlook for business conditions and personal household income. They also reported declines in their net worth, as a result of substantial declines in the value of their home and their investments/savings during the past two years. Together, these factors have contributed to a general attitude toward reducing or deferring expenditures in all areas. The intentions to reduce vacation expenses are consistent with the overall mood of the affluent.
The survey is representative of the population of the most affluent 11.2 million households in the U.S. that account for almost 40% of total personal income and two-thirds of the personal wealth of all Americans.
The 640 men and women included in the national survey have an average annual household income of $290,000, an average primary residence value of $1.2 million, an average net worth of $3.1 million, and average investable assets of $1.4 million. This survey of the affluent market has a maximum margin of error of five percentage points at the 95% confidence level.
These surveys track how affluent consumers assess current business conditions and their 12-month outlook for the economy, the stock market, personal household income, and their spending plans for different products and services that include major appliances, home computers, furniture/furnishings, home entertainment equipment, casual and upscale dining out, entertainment, recreation, domestic and international travel, designer and non-designer apparel, collectibles, fine jewelry, and political and charitable contributions.
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Ron Kurtz is President of the American Affluence Research Center, which provides marketing research and mailing lists of affluent consumers to prominent companies targeting the affluent market.
AARC is an independent, private research organization dedicated to providing reliable marketing information about the values, lifestyles, attitudes, investments, and purchasing behavior of the most affluent segments of the U.S. population through both custom and multi-client surveys.
Ron’s experience includes over 20 years in senior management positions in the airline, hotel, and tour business. As the founding President of Sea Goddess Cruises, he created the product category of small deluxe ships for the very affluent. He also served as the chief marketing officer of four cruise lines, including Norwegian Cruise Line and Windstar Cruises.
Ron has been a key contributor to 6 start ups and 11 turnarounds of substantial businesses. He earned his MBA at Harvard Business School.
The American Affluence Research Center CONTACT: Ron Kurtz at 770-740-2200 or email@example.com. Website: https://www.affluenceresearch.org