Profit from the Splurge Travel Phenomenom

(May 16, 2008 - Travel Trade) -- Some 58% of travel consumers willingly splurge on the right kind of experience, income does not determine who will splurge and who will not, younger travelers are more likely to splurge than older travelers and splurging is driven most often by the desire to create special memories and share unique experiences with loved ones.Those are the key findings in a recent study by PGAV Destination Consulting that explored the behavior and motivating factors of the so-called Splurge Traveler - that traveler who will choose to spend a little extra money on various travel experiences, amenities and products.

The study identified several specific motivators, both emotional and functional, driving travelers to splurge or not.

“We wanted to know why, to the degree that we could understand it at least, people choose to splurge and what’s really behind that,” Mike Konzen, vice president of PGAV Destination Consulting, told Travel Trade.

Understanding these motivators and recognizing when they are applicable may be very helpful to travel agents when it comes to up selling, he added.

“It’s not just about getting them to spend more on their vacation, but really getting them to make the best use of time on their vacation.”

The factors that determine the experiences and products that will create the optimum vacation vary by client, and depend on a variety of emotional and functional drivers.

Emotional Drivers of Splurging

The top emotional drivers behind people’s decisions to splurge are: creation of memories (48.6%), being a good parent/spouse (44.5%), less stress (35.2%) and personal enrichment (35.1%).

Other emotional drivers include deeper engagement (27%), self-reward (21.7%) and self-expression (15.4%).

The top functional drivers influencing splurge decisions are: unique experiences (29.1%), experiences that offer a sense of control (24.2%), choice (22.9%), convenience (22.5%), comfort (21.9%) and quality (21.2%). Other functional drivers are access (11.9%) and personalization (5.9%).

The drivers, especially the emotional drivers, will influence the specific type of splurge opportunity travelers will choose.

For instance, according to the study, travelers who focused on the emotional benefit of self-expression were more likely to splurge on personalized experiences, such as a one-on-one with a chef or a personal guided tour of an historic site.

Splurging and Saving

Go Hand-in-Hand

Time, Konzen said, is becoming “an increasingly precious commodity.” Therefore, travelers want to get the most out of their limited vacation time as possible. Depending on what is important to them, travelers will decide which products and services to invest more money in and which they would rather save on.

In fact, the study found that travelers who engage in splurge spending are 29% more likely to shop for the lowest price hotel and 39% more likely to use a specific credit card to earn points or cash back.

For instance, a family heading to the Caribbean may decide to splurge on a swim with the dolphins in order to create a unique and shared experience, while at the same time choosing a 3-star hotel, rather than 4-star, and using frequent flyer miles for the airfare.

Konzen also said that in an economic downturn, splurge travelers will continue to seek experiences to splurge on, while at the same time becoming more savvy about finding areas in which to save.

Demographics of Splurge Travelers

The study revealed some surprising results in the demographic profile of splurge travelers. They are not all wealthy, nor are all baby boomers.

According to survey results, people who earn under $50,000 are just as likely to splurge on experiences or products that they consider important. Although 35.8% of those who earn over $50,000 will consider paying extra for a hotel room with a view, a full 28% of those who earn less than $50,000 will also consider paying more for a view.

Twenty-six percent would be somewhat or very likely to pay for preferred parking at a theme park and 22.8% would pay to experience immersive interaction with animals.

Also, according to survey results, younger travelers are more likely to splurge on travel experiences than older travelers. In fact, seven out of 10 travelers under 43 would willingly splurge on upscale travel experiences compared to 51.7% of baby boomers (ages 43 to 61) and 38.5% of matures (ages 62-plus).

“One of the bigger surprises in the results were the degree to which [Generations] X and Y were so much stronger than even the baby boomers,” Konzen said.

“You think of baby boomers as being the type of consumer that typically seeks splurge experiences because they deserve it.”

Konzen speculated that the types of emotional drivers that are most influential in determining splurge behavior resonate more with younger travelers.

Conversely, “the lowest two categories we identified on the emotional driver side were self-reward and self-expression, and those are two that knowing what I know about baby boomers, I would typically associate with them.”

** This RSS Feed is brought to you by www.DiveTravelNewswire.com **