Luxury Spending Shifts to Experiences, Outpacing Goods Growth in 2026
1h ago|4 min readStandard
Fazen Markets Editorial Desk
Collective editorial team · methodology
luxuryconsumer-discretionary
Fazen Markets Editorial Desk
Collective editorial team · methodology
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Spending on luxury experiences is projected to grow 3% to 7% in 2026, according to a new report released on June 25. This growth rate outpaces the expected 1% to 4% increase for luxury goods. The divergence highlights a durable shift in high-net-worth consumer behavior toward experiential purchases and multi-generational travel, known as inheritourism. This realignment of priorities carries significant implications for publicly traded companies within the consumer discretionary sector, from luxury conglomerates to travel and leisure operators.
The preference for experiences over material goods is not new, but its acceleration within the luxury segment signals a maturing post-pandemic trend. The last major surge in luxury goods spending occurred in 2021 and 2022, with LVMH reporting year-over-year revenue growth of 44% and 23%, respectively, as pent-up demand fueled a shopping rebound. The current macroeconomic backdrop of elevated interest rates and persistent, though cooling, inflation has tempered discretionary spending on high-ticket items. The catalyst for the current divergence is a saturation point in goods ownership among the wealthy, combined with a heightened societal focus on creating lasting memories and family legacy following periods of global disruption. This has redirected capital toward exclusive travel, private events, and wellness retreats.
The forecasted growth bands present a clear hierarchy: experiences at 3-7% versus goods at 1-4%. This 3-percentage-point advantage at the top end of the range underscores a significant demand shift. The global personal luxury goods market was valued at approximately 362 billion euros in 2023, according to Bain & Company. A 4% growth rate applied to that base equates to over 14 billion euros in new spending, while a 7% growth rate for the less-defined experiences market suggests a potentially larger absolute capital flow into that sector. Peer comparisons reveal similar stories; cruise operator Carnival Corporation's forward bookings reached a record $8.3 billion for 2026, far outpacing the sales growth guidance of many luxury retailers. The S&P 500 Consumer Discretionary sector has gained 4.2% year-to-date, roughly in line with broad market indices, masking the underlying rotation from goods to services.
The divergence in growth rates means the 3-7% band for experiences effectively doubles the 1-4% band for goods at the midpoint.
This shift creates distinct second-order effects across markets. Traditional luxury goods stalwarts like LVMH (MC.PA) and Kering (KER.PA) may face sustained pressure on top-line growth outside of price increases, while companies leveraged to high-end travel and experiences stand to gain. This includes luxury hotel groups like Four Seasons (private), cruise lines such as Royal Caribbean (RCL), and bespoke tour operators. The risk to this thesis is an economic downturn severe enough to curtail all discretionary spending, including travel. However, historical data shows luxury experiences often demonstrate more resilience than goods in mild recessions, as the wealthy protect their leisure budgets. Positioning data shows institutional investors have been rotating into travel and leisure ETFs, with the Defiance Hotel Airline and Cruise ETF (CRUZ) seeing positive net inflows for five consecutive months, while reducing exposure to European luxury retail funds.
Two specific catalysts will test the durability of this trend. The Q2 2026 earnings season, beginning in mid-July for luxury brands, will provide hard data on sales divergence. Management commentary on forward guidance will be critical. Second, consumer confidence data for July and August, released by The Conference Board, will indicate whether sentiment supports continued experiential spending. Key levels to monitor include the relative performance ratio of the Consumer Discretionary Select Sector SPDR Fund (XLY) against the Consumer Staples Select Sector SPDR Fund (XLP). A rising ratio indicates risk-on, discretionary spending sentiment. If luxury goods companies report organic growth below 2% while travel companies reiterate strong bookings, the rotation thesis will strengthen.
Retail investors should scrutinize portfolio exposure to pure-play luxury goods retailers and consider rebalancing toward diversified consumer discretionary names with strong services segments. ETFs focused on travel and leisure offer a basket approach. The shift suggests that growth metrics for traditional luxury houses may compress, potentially affecting valuation multiples if the trend persists beyond 2026, making selective stock-picking more crucial.
Following the 2008 financial crisis, luxury goods rebounded sharply by 2010, led by explosive growth in Asian markets. The current shift is more structural than cyclical. It is driven by demographic preferences—particularly among younger affluent consumers—and a post-pandemic reevaluation of value, rather than a simple recovery from an economic shock. This implies the experience-over-goods preference may have greater longevity.
Asia-Pacific remains the largest source market for luxury spending, but the inheritourism trend is most pronounced in North America and Europe, where multi-generational wealth transfer is currently most active. This is driving demand for customized, high-capacity villa rentals, private yacht charters, and curated cultural tours that accommodate extended families, directly benefiting operators in Mediterranean and Caribbean destinations.
The core luxury consumer is permanently reallocating a greater share of wallet from products to experiences, reshaping the investment landscape for consumer discretionary stocks.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
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