Analysis on Global Yacht Charter Market: Demand from Retail Consumers will Drive the Market During the Forecast Period 2015-2020
The yacht charter industry was hit hard by the financial crisis of 2007-08. However, with the recovery in the global economy, yacht chartering has emerged as a preferred leisure activity among the financially affluent consumer segment. Yacht charter market is showing signs of recovery as the number of high net-worth individuals increase.
Interest in the yacht rentals has rekindled, as world’s superrich and corporate clients queue up to enjoy the yacht chartering extravagance. Yacht rental market is anticipated to expand at a compound annual growth rate of 6.5% from 2015 to 2020, according to the research carried by Future Market Insights. According to the firm, the yacht rental market, which was worth US$ 35 Bn in 2014, will be worth US$ 51 Bn by 2020.
Yacht charter companies have incorporated advanced technology owing to robust demand from consumers. Ambient light controls, LED lighting and advanced temperature controls are some of the features that companies are incorporating in their yachts.
Digital Marketing & Social Media Key Platforms for Yacht Charter Companies
Yacht charter companies are using digital marketing to connect with their target audience. Consumers who seek yacht charters are financially well-off, and use of social media is high among this segment. Owing to these factors, yacht charter companies are building their presence on social media websites.
In order to market their services, yacht charter companies upload pictures of their yachts, showcasing the different features to potential consumers. YouTube, which allows users to watch videos, is widely used by yacht charter companies for promotional purposes.
Facebook has turned out to be a key social media platform for yacht charter companies. According to the research conducted by Future Market Insights, it accounted for a major share of the social media use by yacht charter companies. It is anticipated that Facebook will remain a key social media platform for yacht charter companies in the near future.
In addition to digital media marketing, yacht charter companies are also focussing on PR activities to appeal to their target audience. Celebrity endorsements have also become a key trend among yacht charter companies. For example, Daniel Craig attended the launch of REGINA, a luxury yacht featured in the Bond movie Skyfall.
Unregulated Yacht Charter Sector: A Key Concern for Yacht Charter Market
Yacht charter companies need to register with the concerned authorities and obtain a licence before offering their services. Taxation is quite high on yacht buying and leasing, which eventually is passed on to the consumers. However, many yacht companies, in a bid to avoid the heavy taxation, choose not to register themselves. Although they are able to offer competitive prices to consumers, this whole practice is illegal. Registered yacht charter companies have suffered losses due to the competition from this unregulated sectors.
Chartered Yachts are Highly Sought-after in Europe
Europe is the numero uno destination for yacht charters. According to Future Market Insights, the yacht rental market in Europe (including Russia and Turkey) was worth US$ 20 billion in 2014 - the total size of the global yacht charter market was US$ 35 billion.
The key reason for high consumer demand for yacht chartering in Europe is the presence of some of the world’s most beautiful charter destinations in the region. Greece, which is in the news for its flailing economy, is home to some of the world’s most scenic charter destinations, such as Ionian Island, Aegean Islands, Cyclades, Dodecanese, Corfu, and Athens. The yacht charter season in Greece starts in April and ends in October. In addition to Greece, Turkey is another charter destination that is popular among tourists.
As discussed previously, the target audience of yacht charter is comprised of individuals who are financially well-off. CEOs, entrepreneurs, celebrities - they are the people who don’t mind spending hundreds of thousands of dollars for a week of luxury in the middle of the ocean. However, demand is also robust from corporates - companies that organise their important functions, such as annual events or anniversaries on rented yachts.
Retail consumers account for bulk of the demand for yacht chartering. According to Future Market Insights, retail consumers accounted for 70% of the total market share in 2014. Considering the recovery in global economy and spurt in yacht rental bookings this year, FMI estimates this segment to expand at a CAGR of 6.4% till 2020.
The consumer segments that make up the retail segment include individual, family/group, and couple. Demand for yacht charters is robust among family/group and couples. According to Future Market Insights, these two consumer segments collectively account for US$ 22 billion out of the total market value of US$ 35 billion in 2014.
Yacht charter companies usually offer their patrons the option of choosing from a wide range of yachts. Yachts can be classified into large, medium, and small - depending on the size. Large yachts, usually over 50m in size, are popular among retail consumers who prefer to visit charter destinations in large groups. Small and medium yachts are popular among couples or small family groups who don’t want to spend a fortune on renting a yacht.
The information in this article is sourced from Future Market Insights’ latest research report, “Yacht Charter Market: Global Industry Analysis and Opportunity Assessment 2015-2020”https://www.futuremarketinsights.com/reports/details/yacht-charter-market