The global luxury market has experienced uneven performance across categories in recent
years, yet one sector has consistently stood out: luxury hospitality and tourism. According to
Bain & Company, even as personal luxury goods declined for the first time in 15 years,
experience-driven categories such as travel, dining, and leisure not only held steady but
expanded.
In 2024, the luxury hospitality market grew by 4%, reaching an estimated $280 billion.
Gourmet food and fine dining rose by 8% to $83 billion, while the luxury cruise sector surged
by 30% to $6 billion. Of the nine global luxury retail segments, it is these experience-based
categories that are leading the way.
“Luxury today is no longer just about products, but about how people spend their time, and
with whom,” said Sami Abdul Rahman, Partner at Bain & Company Middle East.
Several dynamics are shaping this momentum. Multigenerational travel is on the rise, with
families booking larger spaces or cruises to create shared experiences across generations.
Longer stays are also gaining traction, driven by digital nomads blending work and leisure,
and affluent travellers seeking deeper cultural immersion. These trends are keeping
occupancy high and daily rates above pre-Covid levels.
Advance booking patterns further underscore demand outpacing supply, with many luxury
travellers now securing reservations one to two years ahead. Meanwhile, luxury cruises,
once considered niche, are drawing in new customers with smaller ships, curated itineraries,
and conservation- or culture-focused experiences, fuelling 30% growth in a single year.
“The cruise and experiential segments are redefining what high-end travel looks like.
Travelers are seeking immersion, authenticity, and meaningful experiences that go beyond
luxury as status and toward luxury as connection,” said Jack Nolan, Senior Manager at Bain
& Company Middle East.
The Middle East is also emerging as a central player in this global transformation. With its
focus on opening doors to international tourism and investing heavily in luxury destinations,
the region is positioning itself as a hub for experience-driven travel. The UAE continues to
lead in attracting luxury tourists, while Saudi Arabia is rapidly developing its offerings, from
Red Sea resorts to cultural mega-projects. With its geographic position between Europe,
Asia, and Africa, the GCC is becoming a hub for both inbound tourists and regional luxury
travellers.
Luxury is moving beyond products. It’s becoming about experiences that matter, that feel
personal and blend naturally into the way people live and explore the world. For
governments, this means investing in destinations, infrastructure and experiences through
local offerings and pilots that elevate cultural and experiential value and encourage local
players, communities and private sector companies to engage. For private-sector leaders, it
means reimagining customer engagement through creativity, personalization, and
technology-driven excellence. Those who act boldly, expanding supply, deepening
engagement, and innovating beyond the traditional luxury model, will set the pace for the
decade ahead.
The opportunity is clear, the leaders who move now will shape the future of luxury.
