Among all luxury goods categories, experiential luxury was the worst affected, in value terms, by the outbreak of COVID-19 in Canada in 2020. The global halt in travel and the collapse in tourism in Canada in the year had a severe impact on experiential luxury, especially in the peak tourism months of June-August for luxury hotels.
Luxury foodservice is yet to emerge from beyond its niche in Canada as demand remains limited to a very small number of upper-income consumers. Its emergence is not expected to be within the forecast period, as foodservice as well as hotels were severely negatively impacted by the lockdown period and by consumers’ job losses and employers’ work from home policies.
With consumers required to stay at home during the lockdown period in Canada, and also choosing to stay at home more even during the reopening phase, luxury restaurants focused on takeaway services in 2020. Restaurants have elevated their takeaway experience to recreate the unique qualities of in-room restaurant dining.
For experiential luxury, value sales are not expected to return to pre-COVID-19 levels within the forecast period. Experiential luxury is expected to undergo very slow recovery due to lingering consumer fears over COVID-19 infection which will hamper the full resumption of international travel as well as the desire to stay in hotels and eat in restaurants.
While luxury restaurants are likely to remain in a negligible niche, and luxury hotels to represent almost the entirety of experiential luxury in Canada, luxury foodservice is expected to recover ahead of luxury hotels in the forecast period because of domestic demand. By contrast, the regrowth in luxury hotels value sales will be hampered by the decline in international travel and tourism.
Some luxury hotel brands are showing confidence in an expected recovery. For example, Marriott International announced a new addition to its Autograph Collection with the expected 2021 opening of the MUIR, Autograph Collection in Halifax, Nova Scotia.
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