Luxury Hotel Market Essay
“The luxury hotel market is very heterogeneous
from one market to the other. We have defined for this study
3 main categories: luxury brands integrated to hotel groups
and hotel groups that are playing mainly or only in the
luxury market segment.
In the 3 categories, emerging markets are increasingly
showing interest for luxury hotel brands
and the US market is by far the dominant market with the most connected and savviest consumers.” (Samad Laaroussi, Holder of the Chair of Luxury Hospitality of Ecole hôtelière de Lausanne ).
According on the ADR data provided by Smith Travel Research (STR Global) the Hotel Luxury Brand Categories are divided into 3 categories: Luxury Major Integrated Chain (Sofitel, Ritz Carlton); Luxury Exclusive Medium
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What is more, some luxury hotels include even art rooms, fitness gyms, business centers and ballrooms. The market of luxury resorts has witnessed the fastest growth in the consumer retail segment, being therefore responsible for the growth of tourism worldwide.
What represents the stimulus in the luxury hotel market is the increasing number of consumers with disposable incomes. From a geographical point of view the market is driven the by the countries with an emerging sense of luxury tourism, such as Turkey, India, Dubai and China. Key players indicate that luxury hotel markets are in strong correlation with countries where new businesses are rising.
However the market witnesses volatility, whether we are talking about economic instability, or natural disasters, these represents restraints for the market. After facing a significant decline in 2009, followed up by a weak comeback in 2010, the luxury travel market has recorded a strong growth between 2011-2012. (Luxury Hotels Market - Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2013 – 2019,
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Of course having a boutique hotel owned by a big hotel chain, offers you some benefits (loyalty programs), however in some cases the term of boutique, privacy might fade (W Hotel in Barcelona – 473 rooms). This leads us to the questions of how will the big hotel chains be able to maintain the true spirit of a boutique hotel, and what will be the impact on the existing boutique hotels owned by individuals. By penetrating the market of boutique hotels, the big chains had to adapt their offerings to the one of individual run boutique hotels. With the entrance of the hotel chains, the competition has started to grow and the whole market to be more competitive. Thus the hotel chains were able to differentiate themselves from private owned boutique hotels by creating partnerships with famous fashion and designer brands (e.g. Armani, Bulgari), adding therefore a higher luxury touch together with the design and other
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