Luxury spending now driven by experiences and “tourism heritage”

Luxury spending is expected to rebound this year, driven primarily by experiences rather than luxury goods, according to a new study.

After two years of decline, sales of luxury goods are expected to grow between 1% and 4% in 2026, according to a report from Bain & Co. and Altagamma. Sales of personal luxury items are expected to reach between 365 billion and 373 billion euros ($413.6 billion and $422.7 billion) this year.

Tensions in the Middle East continue to slow sales. Dubai, in the United Arab Emirates, was one of the world’s fastest-growing luxury markets before the Iran war, but it relies heavily on tourism and has yet to show signs of recovery. The report said that if the Middle East stabilizes and demand in China strengthens, sales of luxury goods could see growth this year.

The United States is now the top country in luxury goods growth for the first time since 2021, according to the report. He said growth in the United States is largely driven by aspirational consumers.

At the same time, the priorities and spending of wealthy consumers around the world are changing. The report indicates that travel, events and culinary experiences are becoming more important than purchasing prestige goods for show. While luxury sales are expected to grow between 1 and 4 percent, experiences are expected to grow between 3 and 7 percent this year, the report said. Dining, leisure and entertainment bookings are up about 30% this year.

“What we’re seeing this year in experiential luxury is resilience concentrated in categories that offer something that money can’t easily replicate: time, access and meaning,” said Claudia D’Arpizio, senior associate at Bain & Co. “Luxury is increasingly about how people live rather than what they own.”

Travel to non-traditional and less frequented destinations is increasing. “Immersive travel,” or tailor-made slow travel experiences rooted in discovery and tradition, are also increasingly popular. Travel to non-traditional destinations is up 20%, according to the report.

The report also cites the rise of “legacy tourism,” in which wealthy families travel together and members of Generation Z adopt their parents’ travel tastes and preferences.

Cruises in particular attract many first-time buyers as well as repeat customers. Food and gastronomy are driven by a “less but better” mindset, and fine arts are returning to growth.

“Consumers aren’t just spending more; they’re spending differently, looking for personal, authentic moments,” D’Arpizio said.