tourist in luxury beach hotel near luxurious swimming pool at sunset
The phrase "digital nomad" conjures up images of millennials traveling through Asia with backpacks and laptops. You might picture them staying in hostels or couchsurfing and living as backpackers. Your impression isn’t completely wrong. There are many digital nomads who fit into this mold.
But then there are the luxury digital nomads too. This is a newer population of skilled, location independent workers that are earning up to six figures in some niches. What may come as a surprise is that such well-off digital nomads aren’t unicorns. Some 40% of gig workers now earn six figures per year.
Some of them also opt for location independence or a life of frequent travel as a perk of freelancing, causing a small wave of disruptions in the travel industry.
Differences between luxury digital nomads and their predecessors
It’s easy to think that digital nomad culture was driven by passion and a desire to immerse in other cultures. That’s not entirely untrue. However, like many things, economics played a big role in this. Moving away from high cost of living in cities like San Francisco and Seattle was undeniably appealing to many. In fact, some progressive companies are now pitching their remote workers "de-location packages" to move away from overcrowded urban cities.
The opportunity to see the world and control your own schedule while making money and saving costs led to the first wave of the digital nomad movement.
The emerging luxury digital nomad
What happens when the digital nomads who started a few years ago begin to command higher compensation and corporations grow more accustomed to the digital nomad lifestyle of some employees? A new kind of digital nomad emerges. They want the freedom and travel of this life without the budget constraints. And they can afford to do so by setting up cross-border operations, catering to a global clientele and frequently traveling both for business and pleasure.
Several travel startups were quick to recognize the changing face of the nomadic crowd and capitalize on the trend with new offerings.
Co-living companies are on the rise
Co-living startups are a hybrid of co-working spaces and shared living spaces. They are emerging in the same cities that once repelled Millennials with high rents and long-term leases. Co-living spaces provide shared work and social areas and living space.
They have terms that are more flexible than standard leases, but are in no way cheap. In fact, they tend to be packed with amenities in order to provide a comfortable and attractive environment. The typical "customer profile" of such companies is a mature consultant who splits his time between working in three countries, rather than a budget-conscious no-strings-attached millennial entrepreneur.
And they are succeeding in attracting the right crowd. A recent study indicates that major co-living companies in the U.S., who currently have over 3,000 beds were not able to meet the demand and now consider active expansion. Another report suggests that this sector has an untapped demand of about 46.3 million beds and can be worth over $93 billion per year.
Luxury nomads give preference to finer travel
“Unlike the general digital nomad crowd, luxury nomads do not really budget on other travel activities and experiences,” said Roman Boychuk, CEO of Rental24H, a car rental comparison service. “For instance, when it comes to transportation they’re more likely to opt for high-end car rental services in their travels. Looking at our data, there’s a lot of spikes in demand for sports or lux cars in bigger cities during off-peak holiday times. Such models are being commanded for a few days by customers aged between 30-35.”
Digital nomad retreats and masterminds held throughout the year all over the world, are another frequent line of expense among the financially comfortable workers. Most of such events are designed to appeal to people who are well established in their careers and are looking to form connections with workers in similar positions as they are.
Another perk of these digital nomads having decent disposable income is that they are able to avail themselves of transformative experiences via travel. They are spending time and money to participate in social projects, get fit, do volunteer work, even learn new personal and professional skills.
Location independent work is no longer on the fringe. It’s a mainstream choice that is embraced by the very same population that was hesitant to adopt it just a few years ago. As a result, there’s a new growth of upscale, digital nomads who have more money to spend and are choosing to indulge in luxury experiences.
