Sovereign SmartViews: Why Escorted Holidays are taking off
By Ed Goddard
Back in the 1800s, young men and women of a certain class would take part in the “Grand Tour” – a trip, typically through France and Italy, to enjoy the cultural sites and learn more about the wider world. Fastforward over 200 years and escorted tours, whether to Europe or much further afield, are making a major comeback.
What used to be the kind of holiday only experienced by the very rich, has become the norm for a mass of travellers happier than ever to go to far flung places. But this time, rather than travelling in pairs (as was the tradition for the Tour), they are often going as part of an escorted group.
Whether you fancy a gourmet food and wine tour of Italy, a vintage railway tour of India or orangutan spotting in the Borneo wilderness, there’s an escorted tour for that. And the interest in the sector is spilling over into M&A.
In the last 9 months alone there have been several deals in the sector including the acquisitions of Riviera Travel, the river cruise and escorted holidays business and Great Rail Journeys, the escorted railway tours specialist.
For us, we are particularly interested in the trajectory of the “silver pound” - the over 50s who, tired of the image of little old ladies sitting on cramped coaches on their way to Brighton, are jetting off to seek adventure. And they can afford it. According to a myriad of data sources, the over 50s hold the bulk of the UK’s wealth – for example, up to 75% of the UK’s housing wealth
A survey from specialist travel adviser, Silver Travel Advisor, which asked 1,000 members for responses, found that 40% said they would spend more than £3,000 per person each year on travel and 13% would spend more than £5,000.
But while price may be less of an issue, service and familiarity are keys to unlocking this part of the market. They like to stick with what they know; if they find a good escorted tour operator which provides quality and comfort, they are likely to come back. Indeed, many such operators focussed on the silver pound report as much as 35% year-on-year repeat business.
This is a fragmented market at the beginning of a wave of consolidation and Sovereign Capital, with its strong tradition of partnership with ambitious companies, would love to speak to businesses in this space. We specialise in bespoke Buy & Build strategies that take our businesses onto an accelerated growth trajectory to create market leaders.
Please get in touch with me if you’d like to find out more about Sovereign’s approach to Buy & Build. It would be great to hear about your story and plans for the future.