In 2025, the industry segments that are faring the best include luxury travel and river and ocean cruising, along with destinations such as Europe, advisors said, noting that many of their clients continue to seek out vacations that incorporate one-of-a-kind immersive experiences.
¡°Luxury is still booming. Most agency owners that I know are seeing this segment rise right now, some by as much as 25%,¡± said Heather DiPietro, president and CEO TravelSalesGroup, who, while still operating her agency, recently assumed the role of director of business development for the Network of Entrepreneurs Selling Travel (NEST) and TRAVELSAVERS.
¡°It seems to be the last segment to be affected by any kind of geopolitical or economic hot buttons and the first to recover,¡± she added, noting that she is of the mind that the many luxury clients are typically seasoned travelers who are less fearful of geopolitical concerns.¡±
Jonathan¡¯s Travels CEO Jonathan Alder noted that even though the industry overall isn¡¯t as strong it was last year, the luxury market has remained relatively steady. ¡°That said, we are starting to see some softening even in that space compared to the post-pandemic highs of the past few years,¡± he said.
Immersive Experiences
Nonetheless, Alder said he is noticing a steady influx of seasoned travelers who want to continue to travel the world ¨C and often. ¡°This group tends to be more seasoned and less hesitant about navigating global issues, making them more likely to continue traveling, even in times of uncertainty,¡± he said.
Jason Hedrick, CTC, director of vacation travel at CI Azumano Travel is witnessing the same phenomenon. ¡°Despite the prevailing economic and political challenges, a dedicated niche segment persists in prioritizing leisure travel,¡± he said. ¡°This group is especially interested in personalized, experiential trips meticulously crafted around their passions, hobbies and bucket-list destinations.¡±
Upswing in Cruising
¡°The luxury cruise lines are really wowing us,¡± said Shane Lawrence, president of leisure sales at Imagine Travel Vacations.¡°Viking is absolutely killing it. Guests know exactly what to expect, and they deliver.
¡°The around-the-world cruises sell right away, and if you can believe it, when Viking announced their new India river cruises, they sold out in three days ¨C all the way into 2028!¡± he added.
Lawrence said Scenic¡¯s luxury Scenic Eclipse I and II are selling briskly and business from ¡°Virgin has grown by 200% this year,¡± with ¡°river cruises doing better than ever for all brands.¡±
Similarly, Jason Hendrix, director of vacation travel at CI Azumano Travel, noted that the agency is witnessing strong growth in its cruise markets, which he said he believes is due to travelers being ¡°drawn to the perceived enhanced safety and the attractive promotional offers currently available.¡±
Like Lawrence, Hedrick said river cruising in particular ¡°continues to perform exceptionally well and has emerged as one of the most vibrant sectors within cruising,¡±adding that many river cruise lines ¡°now offer themed experiences¡ªranging from wine- and beer-focused journeys to cultural and culinary explorations¡ªfurther driving demand.¡±
Thriving Destinations
Europe is selling briskly this year. Pictured, Rome. (Source: Adobe Stock/neirfy)
¡°It seems like everything is hot right now,¡± said Matt Wahlgren, owner of Matt Travel. ¡°I¡¯m booking cruises all over the world, custom itineraries to Europe and South America, group coach tours, all-inclusive resorts, etc. ¡°Antarctica is much hotter than it used to be, so that is new.¡±
Imagine Travel Vacations¡¯ Lawrence pointed to massive destination growth in Europe, and Italy in particular. Business to Mexico is picking up, he said, thanks in part to the considerable number of hotels and resorts that continue to debut. ¡°The new AVA Resort Cancun and the Hotel Mousai Cancun jump to mind,¡± he said.
Destination Downturns
¡°We have observed a slight decline in business within our leisure and vacation segment this year, where I primarily focus,¡± CI Azumano Travel¡¯s Hedrick. ¡°This downturn can likely be attributed to ongoing economic uncertainty as well as heightened concerns over geopolitical developments globally.
Most notably, such destinations as Egypt and Jordan ¡°are facing hesitancy from tourists who are reluctant to visit areas perceived to be near volatile or unstable situations,¡± he said.
For his part, Lawrence has witnessed a downturn in Hawaii business. ¡°I¡¯m not sure if it was due to the fire in Maui, but Hawaii seems to have really dropped off this year a lot ¨C from the East Coast, that is,¡± he said.
Destination Weddings, Honeymoons
DiPietro of TravelSalesGroup said the agency is seeing a downturn in its destination weddings and honeymoon business. ¡°We went from 10 weddings in 2023 to just four this past year and again this year.¡±
Although she said that business is beginning to rebound, she is not seeing any signs that it is reaching anywhere near the numbers of 2019 and 2022. ¡°The average wedding cycle ¨C the time when a couple starts dating until a wedding ¨C is about 36-60 months,¡± she said, adding that she doesn¡¯t expect to see anything but a slight uptick next year, with a bigger rise occurring until 2027.
Consumer Concerns
¡°The slowdown that I have felt is for certain segments of the population rather than any particular destination or travel style,¡± said Matt Travel¡¯s Wahlgren. ¡°I have clients who are government employees who have backed off from booking trips as they were uncertain about the future of their careers.¡±
Also, Wahlgren has clients who are in the US on long-term visas, and virtually ¡°all of them have decided not to travel internationally at this time out of fear of their visas being revoked or getting extra scrutiny when returning to the US.
¡°There¡¯s definitely been a pullback among travelers with financial concerns,¡± said Alder of Alder Travel. ¡°Many of them had extra savings coming out of COVID and spent heavily on trips in 2021 and 2022, but now, with rising costs and economic anxiety, they¡¯re choosing to scale back on discretionary travel.¡±
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