Asia is so happening

Move over Rolls-Royce, let’s go into the Mini Cooper: New luxury travellers shun ostentatiousness

Region has outstripped Europe as having more high net worth individuals

Asia-Pacific is the new A-list, both as a source and destination.

An annual report compiled by Merrill Lynch Global Wealth Management and Capgemini shows the number of high net worth individuals in Asia-Pacific rose 9.7 per cent to 3.3 million last year, outstripping Europe (3.1 million) for the first time and closing ranks with North America, which has the world’s largest population of wealthy people (3.4 million).

High net worth individuals have investible assets of US$1 million or more, excluding their primary residence.

Last year, the total wealth of those in Asia-Pacific was US$10.8 trillion, compared with US$10.2 trillion in Europe and US$11.6 trillion in North America.

According to the Merrill Lynch report, six out of the 10 economies with the highest growth in high net worth individuals last year were in Asia-Pacific, namely, Hong Kong (up 33.3 per cent), Vietnam (up 33.1 per cent), Singapore, Sri Lanka, Indonesia and India, all up by more than 20 per cent. 

As a destination, Asia-Pacific is also outstripping Europe as the fastest-growing  region, according to a new qualitative and quantitative research conducted by Horwath HTL and International Luxury Travel Market (ILTM).

While Europe is the current top luxury destination, picked by 41 per cent of respondents, Asia-Pacific is the fastest-growing luxury destination.

Future A-list

In Asia, the top three destinations for the next five years, as seen by luxury travel buyers surveyed, are China, India and Australia. ?In South-east and East Asia, Japan, Vietnam, Myanmar and Indonesia will also see growth, while Bhutan and Sri Lanka show promise in South Asia.

Substantial changes in luxury customer demand as a result of the global financial crisis are what’s behind the increasing popularity of Asia-Pacific, in particular East/South-east Asia, among luxury travellers.  

The region appears to be the right fit for a new mood of A-listers who, according to the survey, want less ostentatious places, off-the-beaten-track destinations and destinations that have fascinating cultures and traditions (see below, the face of the new luxe traveller). 

At the same time, Asian destinations are seen as actively developing and promoting luxury tourism.

There are however several challenges specific to emerging destinations, especially in the area of DMCs, inbound tour operators and groundhandling, according to the report. 

“Most commonly, inadequately trained staff, uncertainty regarding access, and safety and security issues (political instability and natural catastrophes) are cited as the major factors restricting the potential number of destinations suitable for luxury tourism,” ?it said.

Well-heeled but less spoilt – the face of the new luxe traveller

Wants to be entertained and stimulated, not just pampered: Pampering was often top priority before the economic turndown. Now, there are new expectations for more active holidays and experiential journeysDemands authenticity, simplicity and environmental care: Out, ostentatiousness! In, hugging locals and immersing in culturesYearns for exclusive products: More privacy, custom-tailored products and services, in line with desire for higher degree of personalisation

This article was first published in TTG Asia, October 14 issue, on page 9. To read more, please view our digital edition or click here to subscribe.

View the original article here