marketing trends in tourism and hospitality

Hospitality Marketing: The Complete Guide in 2024 [Updated]

Marketing your hospitality business effectively is one of the most important things if you want to be successful. However, hospitality marketing is also one of the most challenging things to get right. Especially because it’s such a diverse industry, and pinning down the best strategy for your particular business is not as simple as it might seem.

So why exactly do you need a strong hospitality marketing plan? What are the different strategies you can use? And what trends are effective right now?

Don’t worry if that sounds a little intimidating; we’ve got you covered!

This article serves as an introduction to hospitality marketing and will help to put your mind at ease and explain everything there is to know about marketing your hospitality business, no matter which category it falls under. What’s more, we’ve looked at a few real-life hospitality marketing examples to help you better understand what works and what doesn’t.

Ready to learn how to leverage hospitality marketing and boost your sales?

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What is Hospitality Marketing?

Within the hospitality industry , marketing is the process of promoting your hospitality business with the intent of drawing in more customers.

Of course, the different subcategories, like restaurant marketing , hotel marketing, theme park marketing, etc., will each have strategies that are more effective than others. However, there is a significant overlap between all these tactics, and many of the principles remain the same across the board.

Therefore, things like video marketing and user-generated content marketing, along with customer-centric strategies, will be present in any good hospitality marketing strategy and in the tactics used by those types of organizations.

Summary: What’s Hospitality Marketing?

Hospitality marketing is the process of promoting your hospitality business with the intent of drawing in more customers. Furthermore, there is significant overlap among all marketing tactics, and many of the principles are consistent across the board.

The Importance of Hospitality Marketing

Due to the hospitality industry’s focus on the customer experience, hotels, motels, restaurants, resorts, and theme parks need customer loyalty and social proof to be successful.

With tourism expected to begin picking up now that the worst of the pandemic is over, attracting people to your business is going to be more important than ever before. Moreover, with the drop in market size between 2019 and 2022, from $1.52 billion to $1.06 billion , you’ll need to work even harder to be successful.

But, all hope is not lost, as air travel demand is expected to make a full recovery by 2024 , meaning tourism will once again be on the rise.

Nevertheless, a great marketing strategy is a must-have!

Summary: The Importance of Hospitality Marketing

Hotels, motels, restaurants, resorts, and theme parks need customer loyalty and social proof to be successful. In addition, with the drop in market size between 2019-2022, you’ll need to work even harder to be profitable in the hospitality industry. Therefore hospitality marketing is vital.

5 Hospitality Marketing Trends

1. Chatbots

Chatbots are one of the newest marketing trends across all marketing categories, including in the hospitality industry, and for good reason!

These chatbots can be used to add an extra layer of interaction between you and your customers, helping them to make a booking or reservation and answering their questions. Moreover, this has the added benefit of making customers feel heard and like they are important to you, improving the customer experience.

To see a chatbot in action, check out this video about the Feebi Restaurant Chatbot .

2. Voice Search

The preference for voice activation among the younger generation of Web users represents a significant opportunity for the hospitality industry.

With the aid of speech control and recognition technology, voice search is possible on tablets, smartphones, and other similar devices, including some laptops and desktop computers, making the process for users evermore friendly.

What’s more, this marketing craze may soon eliminate the need for Internet users to type search terms into search bars or click buttons.

This means that hotel guests can make a hotel room reservation by speaking to their smartphones. They can even control the lighting, music, and heating in the room using voice search.

3. User-Generated Content

As with chatbots, user-generated content is quickly increasing in popularity within marketing strategies and is now a frequent tactic used by any hospitality marketing agency . And if used correctly, user-generated content can significantly help you raise brand awareness and boost brand reputation .

User-generated content is content created by online users that they then share and can take the form of endorsements, comments, forums, blog entries, social publishing, etc.

A potential customer who is looking for information about your brand online will usually read customer reviews about your business on other websites or social media platforms before making a final decision.

One effective strategy is to encourage your visitors to share their experiences on social media. To accomplish this, hold contests, create brand hashtags, or set up photo opportunities at your hotel.

4.   Augmented Reality

Augmented reality is one of the most intriguing concepts in hospitality marketing. This trend, which makes use of computer technology, alters a person’s perception of their immediate surroundings.

Hotels, for example, can increase online room sales by enhancing their features with augmented reality. For example, you can use augmented worlds to entertain your visitors in a variety of ways, such as by showing them virtual versions of their favorite celebrities while they are staying at your hotel.

Contrastingly, there are various practical applications you can use to make the customer experience more seamless, like sending virtual keys to visitors’ smartphones.

5. Artificial Intelligence

Artificial intelligence has the potential to simplify procedures while also providing insightful data to you about customers. While many online travelers book their accommodations through aggregator websites, others may visit a hotel’s homepage but leave without making a reservation.

Moreover, most customers would rather speak with hotel staff than enter their preferred dates and check-in information, as that process can be rather time-consuming.

Therefore, you can use chatbots with artificial intelligence on your website to provide personalized support and build a dependable system.

Similarly, if integrated, your visitors will be able to request room service through your AI-enabled website, freeing up the time of your hotel personnel.

• Chatbots create a layer of contact between you and your consumers, making them feel heard and important.
• Voice search could soon eliminate the need for Internet users to type search terms into search bars or click buttons, making their interactions with you more seamless.
• If used correctly, user-generated content can significantly help you raise brand awareness for your hotel or business.
• Augmented reality makes use of computer technology to alter a person’s perception of their surroundings, making the customer experience more seamless.
• Hospitality companies can use chatbots with artificial intelligence on their website to provide personalized customer support and build a dependable system.

6 Hospitality Marketing Strategies

1. experiential marketing.

In the competitive world of hospitality, how a customer feels is the most important factor in getting them to come back. To meet the needs of your hotel, restaurant, or travel agency, you need to make sure you have good customer experience marketing strategies in place.

Moreover, it’s important to keep in mind that giving great customer service does not always lead to immediate financial gains but will most certainly pay off in the long run.

One way to get strong returns and a steady stream of repeat customers is to collect analytics from online customer testimonials on review websites. This will give you a lot of information about your customers’ preferences, ideas for how to improve your business, and signs of future sales.

2. Personalization Marketing

Personalized marketing allows businesses to send tailored content to their target clients by utilizing automated technologies and data collection. Furthermore, personalization marketing aims to engage potential customers by communicating with them on an individual level.

As such, targeted emails are an important way for hotels, resorts, and tour operators to personalize their services for customers and guests. For example, when a travel agency or hotel is about to offer a discount, customized emails can be sent to people who might be interested.

Personalization marketing is one of the most direct hospitality marketing strategies you can use to get to know your customers better and get them to come back.

3. Influencer Marketing

Influencer marketing is quickly becoming a fantastic option for hospitality marketers looking to stay relevant in a competitive industry. Furthermore, influencer marketing, a digital take on traditional word-of-mouth advertising, assists hotels in building their brands and attracting direct bookings.

By using this method, you can reach a much larger audience and gain more clients for your hotel or travel company by developing consumer reputation and trust. As a result, you can attract potential clients by delivering genuine content from a person who is highly influential and authoritative in the

With your influencer marketing campaign, for example, you could target young people who are increasingly choosing Airbnb services over traditional hotels. the niche you’re attempting to target.

4. Video Marketing

Hospitality companies in the travel industry can use video marketing to interact with their target market by posting videos on Facebook Live, Instagram, Snapchat, Discord , Reddit , and YouTube .

Although written content can help you raise brand awareness and attract readers’ attention as well if you want to engage them right away, why not provide them with digestible visual content about your hotel or resort?

As such, marketers have an almost infinite number of options available to them, ranging from live feeds of hotel activities to promotional videos highlighting hotel features and customer interviews discussing their experiences. Furthermore, with the growing popularity of 360-degree video, there are more options for completely immersing viewers than ever before.

You could, for example, use video marketing to show people the peaceful moments they can have at your hotel, highlight your delectable cuisines, or show off the fun activities you provide.

5. Content marketing

We just mentioned how video content is often more effective than written content; however, both fall under the same umbrella term of content marketing. Likewise, each type of content marketing has its place and can have a large impact on sales and your customer base .

Content marketing aims to draw in customers by providing them with useful, almost always free, resources to provide them with value and sway their decision-making in your favor.

For example, running something like a blog or weekly magazine can serve this purpose extremely well, as you’ll be giving information that potential customers will find useful.

6. Remarketing

Remarketing, a powerful marketing strategy, includes targeting potential customers who have previously visited your website or expressed interest in your services. As a result, remarketing is a way to get back in touch with website visitors who spent some time looking at your pages but didn’t book a room or service.

You can use this technology to contact previous site visitors and offer them a discount in order to entice them to return. For example, you can use Google Analytics to customize this technique based on the user’s interests or demographics. You can also filter these queries to obtain specific information about website visitors.

Summary: 6 Hospitality Marketing Strategies

• Experiential Marketing
• Personalization Marketing
• Influencer Marketing
• Video Marketing
• Content marketing
• Remarketing

3 Great Hospitality Marketing Examples

1. marriott hotels: video marketing.

Video marketing has evolved into an important component of many advertising campaigns today, and the hospitality industry can reap significant benefits from it. For the companies that run hotels, recreation centers, and restaurants , you can showcase many incredible experiences through video.

for example Marriott Hotels capitalized on video marketing’s increasing popularity and effectiveness when they launched their short film campaign.

Therefore, with short films, Marriott was able to demonstrate what guests could expect from their hotel stays while also highlighting the distinctive aspects of its brand personality. Similarly, videos can be used in your hospitality business for anything from one-on-one interviews to behind-the-scenes tours.

2. InterContinental Hotels: Content marketing

As previously stated, content marketing is a valuable addition to any hotel promotion strategy. However, that content doesn’t have to be text-based to be effective. As such, podcasts have grown in popularity in recent years, particularly among consumers who do not have the time to watch a video or read an article.

The “Stories of the InterContinental Life” collection of podcasts, with tales from all over the world, was introduced by the InterContinental Hotel brand in an effort to engage with its target audience. The podcasts delve into the enchantment of luxury travel and the incredible experiences that people can discover when they widen their horizons.

3. Loews: User-Generated Content

The best hospitality marketing tactics don’t always involve producing fresh material for your audience to consume. Instead, you can concentrate on distributing the content that your customers are often already producing and utilizing that data to increase sales.

Loews Hotel, for example, launched its #TravelForReal social media campaign in 2015 to encourage customers to share photos of their travels online. Their catchphrase, “Because no one can tell our story better than you,” was perfect for connecting with Loews’ target audience. And as such, the user-generated content campaign was an excellent way to raise brand awareness and demonstrate Loews’ commitment to its customers.

Summary: 3 Great Hospitality Marketing Examples

• Marriot Hotels: Video Marketing
• InterContinental Hotels: Content marketing
• Loews: User-Generated Content

Hospitality Marketing Final Thoughts

And that’s it! Everything you need to know to turn your hospitality business into one of the leading companies in your industry!

We’ve covered everything from what hospitality marketing is to why it’s important, as well as breaking down the top trends and strategies with real-life hospitality marketing examples just for you.

Keep in mind that hospitality marketing is a very challenging thing to get right, and it can be time-consuming. But if you are up for the challenge, this article has given you the tools you’ll need to get it right! Otherwise, you can always look into hiring a hospitality marketing agency, which will handle everything for you.

Either way, marketing your hospitality company is one of the most critical business choices you’ll ever make.

So what are you waiting for?

Get to marketing!

Frequently Asked Questions

What’s hospitality marketing.

Hospitality marketing is the process of promoting your hospitality business with the intent of drawing in more customers. Furthermore, there is significant overlap among all marketing tactics, and many of the principles are consistent across the board. Read the full guide to learn more about hospitality marketing and the best strategies to use.

Why is hospitality marketing important

Hotels, motels, restaurants, resorts, and theme parks need customer loyalty and social proof to be successful. In addition, with the drop in market size between 2019-2022, you’ll need to work even harder to be profitable in the hospitality industry. Therefore hospitality marketing is vital. Read the full guide to learn more about the importance of hospitality marketing and the best hospitality strategies, with examples.

Which type of marketing is done in the hospitality industry?

Hospitality marketing assists advertisers in travel, restaurants, and consumer services in raising consumer awareness and consideration of their products and services. Hospitality marketing strategies can help brands drive customer engagement and maintain top-of-mind awareness. Read the full guide to learn more about hospitality marketing, what it involves, the best strategies to use and some great examples to learn from.

Cvent : What Is the Hospitality Industry? Your Complete Guide

SoegJobs: Key Success Factors of the Hospitality Indistry

Statista : Market Size of the Hotel and Resort Industry worldwide (2013 to 2023)

FinancesOnline : 109 Hospitality Statistics You Must Know: 2024 Data Analysis & Market Share

LocalIQ : 90 Online Review Statistics That Will Blow Your Mind in 2024

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2024 Hotel Marketing Trends You Need to Know About

Each year, fluctuating industry trends influence how hospitality businesses connect with consumers and promote their products. To help hotel and venue professionals keep up, Cvent’s Supplier and Venue team conducted thorough research to identify which meeting, event, and hotel marketing trends you need to know about in 2024 . From digital innovations and technological advancements to shifting consumer preferences and rising costs, we determined which trends will impact hotel operations, revenue management, and sales strategies this year and beyond.  

Stay ahead of the curve with 2024 meeting and event trends

Discover which hotel marketing trends to watch this year  

This guide explores the most prominent trends shaping our outlook in 2024. As we review the most significant trends shaping travel this year, you’ll learn more about the impact hotel marketing trends can have on each level of hotel operations. As we explore the latest hospitality trends and consumer data, you’ll uncover tips, tools, and best practices you need to make the most of 2024’s biggest trends, including:  

Rising costs  

Prices continue to increase and impact every hotel level, from brand and property management to consumer spending habits and travel preferences. We’ve seen groceries, subscriptions, and other daily expenses rise, and hotels can expect to see the same. Hoteliers will see increased costs reflected in almost every expense category, including hard and soft goods, installation costs, staffing expenses, energy usage, and marketing costs.   

Cvent’s Planner Sourcing Survey for North America found that 82% of planners expected costs to continue going up, with 42% of respondents stating that cost mitigation is a significant factor in their current and future planning priorities. Due to rising expenses, event planners, travelers, and hoteliers are working hard to reduce waste, optimize efficiency, and stretch their budgets further. Get ahead of surging costs by—  

• Building enticing offers that incentivize planners to book at your hotel.  
• Monitoring resource usage and instituting waste reduction strategies .  
• Creating targeted marketing that earns more from every advertising dollar spent.   
• Highlighting the value and service level you offer for the price.   

Shifting workforce demands  

The American Hotel and Lodging Association (AHLA) estimated hotel staffing levels would eclipse early post-pandemic levels in 2023, employing almost 2.1 million people and eclipsing 2022 levels by 7.4%. However, Indeed showed 70,000 available hotel jobs still open in December, with many of the newest workers lacking hospitality experience, causing a disconnect between planners and suppliers. Although staffing levels are improving, increased travel and shifting workforce demands have left many hotels needing to rebuild meaningful relationships.  

24% of Sourcing Survey respondents ranked having an existing relationship with hotel staff as one of the top three factors influencing their venue sourcing decisions. As a result, hotels with newer workforces or weaker reputations may struggle to maintain and grow valuable partnerships. Build trust and foster stronger planner relationships this year by—  

• Building a transparent booking process.  
• Opening more communication channels.  
• Quickly responding to leads, inquiries, and planner requests.  
• Incentivizing and rewarding repeat business .   

Growing bleisure opportunities  

The pandemic spurred significant changes in how we do business, with virtual events and work-from-home becoming the norm. Although we’re now operating in a primarily post-pandemic world, hybrid work policies and the digital nomad lifestyle are here to stay. In a continuing effort to make up for all the pandemic-related movement limitations we experience, workers are fitting in memorable and exciting new experiences anywhere possible, leading to a sharp incline in bleisure travel (business + leisure).  

The continued growth of the bleisure market demonstrates shifting consumer preferences and their desire to stay at hotels that offer flexible workspaces and exciting leisure opportunities. 61% of travelers responding to an American Express Global Business Travel and CULTIQUE survey confirmed that they would support policies that promote mixing business and leisure travel, such as offering extended stays or allowing family members to join.   

Capture more bleisure business with targeted marketing campaigns that promote tech-friendly hotel amenities, flexible onsite workspaces, and things to do nearby. Widen your network capacity and strengthen cybersecurity measures to ensure guests can conduct business safely during their visit. Create exciting packages that give guests more memorable all-in-one stay experiences, like a three-night stay with breakfast and local attraction tickets. Consider offering additional night discounts to upsell extended stays.   

More automation   

With 67% of hotels reporting a staffing shortage in February 2024, Autonomous Guest Engagement Systems (AGES) play a pivotal role in day-to-day operations for many properties. In addition to helping lodging partners cross into the digital age, AGES helps hotels operate more efficiently by providing personalized, automated guest service, enabling teams to scale their services more effectively.   

I dentify automation opportunities at your hotel to help every department keep up with the fast-paced, low-staffed industry environment. Invest in automated communication, information, and entertainment-based services, like:   

• Management tools  

Automate inventory and rate management, energy usage monitoring, employee scheduling, and other hotel management procedures. Improve hotel operations and simplify revenue management activities by automating time-consuming tasks.   

• Real-time analytics   

Automated business intelligence software supports data-driven hotel growth. Real-time data analysis and forecasting enable sales and revenue managers to identify need dates, high-demand periods, rate opportunities, and more.   

• In-room technology    

Automated in-room devices, like Bluetooth speakers and smart TVs, benefit hotels and guests. Reduce energy consumption and improve the guest experience by allowing travelers to connect guestroom technology seamlessly, allowing visitors to continue streaming (e.g., Netflix, Spotify) their favorite show or playlist right where they left off.   

Whether saving time, reducing manual entry errors, improving hotel security, or updating inventory, automation allows hoteliers and staff to spend more time where it matters most: with customers.   

Expanding sustainability initiatives    

When sourcing hotels and event venues, sustainability has become an increasingly important factor for travelers, planners, and corporations. Data from a recent Expedia Sustainable Travel Study showed that as many as 90% of consumers actively seek more sustainable travel options, a trend we anticipate continuing well beyond 2024. Travelers are committed to reducing hospitality’s impact on the environment by booking with properties that promote—  

• Waste reduction: Usage monitoring systems, automatic water cut-off tools, energy-efficient light fixtures, and solar power are just a few resources hotels can use to minimize their environmental impact.   
• Smart amenities: Smart thermostats, air filters, lighting systems, and other eco-friendly amenities limit consumption and help cut costs. Program sustainable hotel systems to dim the lights when a room is empty, reduce HVAC reliance, and automatically filter allergens from the air.   
• Hotel initiatives : Promote hotel initiatives and encourage guests to participate by demonstrating their impact on hotel sustainability goals. Encourage visitors to reuse towels and show how it could positively affect hotel water usage, or install water bottle filling stations instead of vending machines.  

Hotels that implement sustainable business practices can capture more business while reducing waste, mitigating expenses, and reducing their carbon footprint. Because of the clear benefits and strengthening consumer desires, going green is no longer an option for most hotels; it’s necessary. Sustainable hotels are the future of hospitality .   

Your exclusive guide to sustainable meetings

Increasing accessibility demands  

Expanding digital and physical accessibility will be a major driver for hoteliers and industry professionals this year. Whether reserving a room, group block, or meeting space, planner feedback reveals their growing desire to easily access all the booking information they need online—without help from a hotel representative. Our research indicates a diminishing willingness to collaborate with employees as the desire for fast, easy booking grows. To stay ahead of changing travel patterns and engagement preferences, hotels should strive to make their property more accessible to everyone, including in-house guests and digital visitors.   

• More physical accessibility   

Install digital hotel technology, like interactive kiosks, to help assist guests and prevent long front desk lines. Instead of waiting in a long line to check in or get directions, digital concierge services help guests access hotel information quickly while reducing lobby congestion. Invest in upgraded amenities like guestroom tablets, touchscreen menus, and integrated apps, which allow guests to make requests and access hotel services faster.   

• More digital accessibility   

Revamp your digital presence and optimize hotel SEO to make your content easier to find. Create engaging venue listings with virtual tools that show off what your property has to offer, like event diagramming tools. Cvent’s Event Diagramming software provides an immersive virtual booking experience , allowing remote planners to visualize what their event will look like in your space without ever completing a site tour. Additional tools, like automated RFP responses and Instant Book, increase remote hotel accessibility, simplify sales, and speed up the booking process .   

Add new communication channels to expand accessibility even more. Hotel text messaging , chatbots, and virtual assistants enable every guest to access assistance when needed, even if there’s only one employee at the desk.  

More focus on visual/interactive content    

Data shows that hotels prioritizing interactive and visual content early in the sourcing process are more likely to capture planners’ attention and win their business. Visually captivating marketing content grabs attention, with over 53% of Planner Sourcing Survey respondents ranking videos and images among the top three influential factors impacting early sourcing decisions. 51% of respondents ranked floor plans and event diagrams as highly.   

Implementing a variety of digital touchpoints throughout the sourcing process helps keep planners more engaged. Walk through the sourcing process that planners reviewing your hotel might experience. Put yourself in their shoes. Pinpoint opportunities to incorporate visual content, such as colorful images or video ads, and interactive tools, like virtual property tours or live event diagramming software , that show off your venue in photorealistic 3D.  

Increasing presence of AI   

Artificial intelligence (AI) will continue influencing hotel operations, sales, and event management. Many industry experts view generative AI as one of the most disruptive forces facing hotels. Whether using AI to automate payment processes, personalize guest recommendations, streamline behind-the-scenes procedures, or optimize revenue management strategies, properties that employ AI have a leg up on less advanced comp sets.   

From opening new communication channels to launching more targeted marketing materials, AI grants hotels the tools they need to—  

• Leverage predictive analysis . Anticipate demand trends across travel segments, predict group sales potential, and implement proactive pricing strategies based on valuable, real-time market data.   
• Take over repetitive tasks. AI can take over repetitive tasks like lead generation, data entry, and rate loading. This enables sales and service staff to focus on rebuilding relationships and spending time at work more productively.   
• Personalize guest recommendations. Give guests what they want from a hotel with AI-driven personalized recommendations based on their booking history, behavioral patterns, and other helpful data points.   
• Optimize hotel pricing strategies. Move to a dynamic pricing model based on occupancy, demand, and more. Use AI-powered tools to publish rates, enforce booking policies, or add length of stay restrictions based on demand and seasonality.   

Properties that hesitate to utilize the power of AI will struggle to keep up with competitors who embrace the technology. Identify how artificial intelligence can help your property reach more consumers, pump up productivity, and plan for the future.   

Stronger partnerships with CVB’s  

Increasing bleisure travel and growing demands for memorable travel experiences have left destinations battling to gain the attention of would-be bookers. Lesser-known locations may not have a notable online presence, making it harder for destination travelers to find hotels or other points of interest.      

Contact your area’s destination management organization (DMO) or Convention and Visitors Bureau to advertise your destination. These travel partners work to drive travelers, businesses, and visitors to your area, powering the local economy and the companies operating in it.   

Partner with CVBs to create compelling marketing campaigns and entice individuals, corporate planners, travel agents, and other bookers to choose your location for their next event. Promote what makes your destination unique and why it’s the perfect location to host various events and traveler types.  

Action Item: Partner with destination marketing managers in your area to connect with more actively sourcing planners. Create affordable event packages that don’t skimp on the experience.

Frequently asked questions about hotel marketing trends

For more information about hotel marketing trends affecting properties worldwide, check out some of the most recently asked questions about advertising trends below:

1. What trends are affecting boutique hotels in 2023 and 2024?

Boutique hotel travel trends align with major leisure travel trends, highlighting a preference for local and immersive experiences , loyalty programs, and video content that shows prospective guests what they can expect in advance. Boutique hotels can prepare by forming networks with local businesses and attractions in the community.

2. Is daily room demand expected to rise in 2024?

Daily room demand continued to increase in 2023 as the desire and demand for travel do the same. Costar predicts the average daily demand for hotel rooms will reach its highest levels in 2023 . This trend should continue into 2024, with ADR and occupancy both expected to grow .

3. What sustainability tools are trending in 2023 and 2024?

Hotel sustainability efforts are growing globally as tourism's environmental and long-term impacts (and other industries) become more well-known. Properties of all shapes and sizes participate in various sustainability initiatives and implement sustainable hotel solutions, like smart thermostats, bottle refilling stations, and recycled in-house products. Some of 2023’s most popular sustainability solutions include hotel automation, renewable energy, and air-source heat pumps.

Incorporate 2024 hotel marketing trends into your action plans.   

In addition to changing marketing techniques, hotels constantly grapple with meeting, media, and technology trends influencing the industry. Keep an eye on changes in your market to develop more informed, proactive hotel management strategies. Prepare for unexpected market fluctuations by exploring 2024 trends in the events industry and their potential impact on your business.   

Kim Campbell

Kim is a full-time copy and content writer with many years of experience in the hospitality industry. She entered the hotel world in 2013 as a housekeeping team member and worked her way through various departments before being appointed to Director of Sales. Kim has championed numerous successful sales efforts, revenue strategies, and marketing campaigns — all of which landed her a spot on Hotel Management Magazine’s “Thirty Under 30” list.

Don’t be fooled though; she’s not all business! An avid forest forager, post-apocalyptic fiction fan, and free-sample-fiend, Kim prides herself on being well-rounded.

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7 travel marketing trends for 2022

So where should we focus our priorities for the upcoming years? Here are seven trends that I believe will shape our marketing as we move forward.

1. TRAVELER EXPECTATIONS HAVE CHANGED

One of the biggest consequences stemming from this pandemic is how it changed our needs and wants when it comes to travel. In fact, many studies found that low prices were no longer the number one consideration when it came to decision-making in purchasing travel. In a recent article, I shared  what travelers expect in 2021  and we see a clear shift from traditional views, with flexible booking conditions and sanitary measures now coming in at #1 and #2 in terms of importance for travelers.

How is your hotel, restaurant or attraction conveying this on your website? On your social media posts? Are you addressing these concerns with a dedicated tab on your website menu or with information in your regular newsletter? Integrating these aspects in your ongoing communications will be key.

Nature of travel is changing, too

2022 will mark the return of the international traveler, finall. But your organization should also pay attention to evolving behaviors in the travel landscape that were clearly shaped from this recent pandeminc. For example the working travelers, or digital nomads. If these travelers were marginal a couple of years ago, we can expect more and more leisure travelers mixing some business into the equation.

Just like business travelers will also add a few days onto their trip since technologies make it easier than ever to have meetings by the poolside or in a wifi-enabled room. Is your brand ready for this new reality and how are you communicating it across your digital touchpoints?

2. THE EVOLUTION OF LOYALTY PROGRAMS

Loyalty programs have been around for ever, and were able to move the needle (somewhat) of retention mostly with customers in the airline industry, where they were born originally. Hotel loyalty programs are a dime a dozen, and too many of these programs have failed to have distinctive features or get customers to increase their spend. For bigger chain hotels and resorts that can scale offers, loyalty programs still provide value but this is less the case for independent hotels and smaller players.

Now, we are also seeing subscription-based approaches such as  TripAdvisor  with its Plus program. And more recently,  Expedia  revamped and unified the loyalty programs within its portfolio of brands (Expedia, Hotels.com, Orbitz, Vrbo, etc.) in order to better position itself against competition such as Booking.com’s Genius Loyalty program. The new program will span flights, hotels, vacation rentals, car rentals, cruises, and activities.

We can expect more movement on this front, as hotels, restaurants and other hospitality providers will want to maintain their appeal within the broad loyalty and reward programs universe. This is also a key tactic to preserve the direct booking channel alive and kicking (see next point).

3. DIRECT BOOKINGS WILL PREVAIL, BUT LESS

For years now, hotels have been striving to get customers to book directly on their own website, where costs are low, rather than through brand.com or third parties like Expedia or Booking, where commission levels are steep. With more or less success.

This pandemic has brought in a rare opportunity, making domestic travel a must and only option. When booking locally, travelers feel less of a need to search on OTA platforms and are more confident about dealing directly with travel providers. Thus, direct bookings percentages when through the roof in 2020… but a bit less so in 2021, according to preliminary data from various reports.

In 2022, we can expect a shift back to reservations going to brand.com and, to a lesser extent, back to OTA catering more to an international clientele in general. Direct bookings will remain strong, but won’t stay at levels seen in 2020.

4. TIKTOK NOW A MAINSTREAM PLATFORM

It was almost two years ago when I posted an article stating  Why TikTok matters for travel brands . Now, more than ever, travel and hospitality need to pay attention. Here are a few reasons why:

• TikTok now has more than 1 billion active users (MAU)
• It has been among the most downloaded mobile apps worldwide for over 6 consecutive quarters
• The average user spends over 52 minutes per day on the platform
• TikTok gets the highest levels of engagement per post of any social media
• The fastest growing segment of users are 25-39 year-old

That last bit of information is perhaps the most crucial one. Whenever I talk to brands about the possibility of TikTok, the classic rebuttal I get is that “ it’s for young teenagers only “. That might have been true in its earlier stages, but less so today. Content is more varied than it once was, with tutorials, cooking recipes, movie critics, travel recommendations, and so much more.

Don’t get me wrong, TikTok IS a platform that caters very well to a younger audience, because of it’s very nature and features: music, dancing, trends, pranks, etc. But as it grew in the past two years, so did its userbase. It would therefore be a critical mistake to dismiss it as possibility for your marketing mix in the coming year.

Going mainstream

One last point about TikTok. Late September, it held its first ever TikTok World Event during which many new features were shared for both content creators AND brands wishing to invest on the platform. Advertising is becoming more fluid and accessible, while longer videos are now possible. All in all, we are dealing with a platform reaching a maturity level that has Facebook (and Instagram) shaking and reacting… so it will be interesting to see how this battles unfolds!

5. INSTAGRAM AS THE GO-TO SOCIAL MEDIA

If there is anything the past couple of weeks have shown us, one thing is clear: Facebook is no longer the key social platform for storytelling. It remains a necessary evil, with its Events, Groups, Messenger, Marketplace and other useful features. But as younger audiences continue to flock away from Facebook, there is one silver lining that remains: Instagram.

Case in point, last year SocialBakers evaluated how top Fortune 50 companies were dealing with their presence on Facebook and Instagram. As we can see in the chart above, comparing Q1 2019 with Q1 2020, audiences on Facebook shrank while those on Instagram increased. Interestingly, this increase occured even though brands were posting less, as we can see in the middle column. But to me, the most interesting finding comes from the third column, where we see total interactions, or engagement. Facebook already had dismal engagement levels, and it continues on shrinking while Instagram continues to see robust interaction.

Stories work well on Instagram, less so on Facebook. Reels are working relatively well on Instagram, even though they don’t match TikTok posts, which they clealy emulate. Reels are just arriving on Facebook, but I suspect they will do just like stories, which means not much. AR lens are useful and plentiful on Instagram, less so on Facebook.

Can you see a pattern, here?

Brands must stick with Facebook. For now.

Having said that, I am not saying travel brands should ditch Facebook just yet. Facebook has become a  de facto  outpost for customer service, recruiting, content sharing and overall communication with your community. A dynamic page means better ad campaign performance across the Facebook landscape, which includes Instagram, Messenger and Whatsapp. And there are many brands out there that still do a stellar job at creating quality content, which results in great reach and engagement levels.

But as the recent seven hours shutdown showed, it’s dangerous to put all your eggs in the same (Facebook) basket. Thus, having a diversified approach online is key.

6. NEWSLETTERS AND EMAIL MARKETING MAKE A COME BACK

For the past 20 years now, I have been hearing that email is dead, or that newsletters don’t work “as well as they used to”. Really? In a world where social media algorithms block off up to 95% of the content you post on your pages, one-to-one communication like emails, SMS and newsletters are more pertinent than ever.

If you read the points #3 and #4 above, you will also see a cause and effect correlation here. That is, with travel brands pushing more direct reservations and increasing efforts for retention and loyalty, having an email strategy in place is fundamental to fostering that relationship. This also means having automated processes prior to, during and after a stay, including invitations to leave a review after the experience on key platforms, i.e. Google, TripAdvisor, Facebook, etc.

7. WEBSITE SEO MORE IMPORTANT THAN EVER

According to a Google survey from December 2020, searches for “available near me” grew globally by more than 100% since 2019. In 2021, these searches are up another 60% according to SearchEngineLand. What’s even more interesting is when we dig further to see which were the top categories for these searches over a given period of time.

The top categories for those searches were:

• Entertainment (56%)
• Banking (50%)
• Apparel (41%)
• Personal Care (38%)

These are all categories deeply rooted in the travel experience, as we seek places to eat, things to do and stuff to buy whenever we are in a new destination for leisure or business. So how is your website ranking whenever travelers search with keywords that should lead to your brand?

Your website should not only be mobile optimized, in fact in many cases it should be properly be designed with mobile-first in mind.

Read also:  Understanding the difference between mobile-first, adaptive and responsive design

More importantly, you will want to make sure you claim and manage your  Google My Business  profile. This will ensure you complete all relevant details with regards to your opening hours, amenities and services, photos and videos. This is also where you can manage and respond to reviews, since this has become an important facet for your online reputation.

BONUS: HR MARKETING TO HELP LABOR SHORTAGES

Last but not least, I thought I would mention the fact that all these marketing strategies and tactics are fine and swell in normal times. Or rather, in times when operations are growing smoothly as they should coming out of a worldwide pandemic. Truth is, however, there is a major issue that has been looming over the industry for the past 3-4 years and that is now exacerbated to unseen levels: the shortage of labor.

Earlier this summer, I shared  5 ways to mitigate shortage of labor in Hospitality  and one of the tactics was actually to have a proper HR Marketing strategy in place. Well, I suspect we will be seeing lots more of this integration in 2022, where human ressources will work closely with marketing and communications to convey the employer brand vision, mission and values on social networks and other digital outposts.

Labor shortage will be a problem for the next decade, and marketing alone will not solve it. But a strong and creative digital presence can certainly contribute to a stronger employer brand which, in turn, will help with recruiting and maintaining workforce stability.

First posted on federicgonzalo.com

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6 trends shaping the travel landscape

In last year’s report, we discussed five emerging trends: value-driven decisions, the virtual front desk, hybrid hospitality, new search habits, and the rise of experiential travel. This year, we anticipate these trends to continue, along with six newer developments poised to reshape the travel landscape. 

These trends include a resurgence in lagging market segments, an uptick in inflation-busting travel hacks, and new spins on experiential travel. We also anticipate continued growth in the short-term rental sector (despite rumors to the contrary), new efficiencies driven by generative AI, and growing demand for new skills among next-generation hoteliers. 

While the economy seems poised to dodge a recession again this year, that doesn’t mean it will be smooth sailing for hotels. As we observed in the previous section, travel patterns are changing, travelers are more price-sensitive, and demand may soften. Under any market conditions, it’s the hoteliers who monitor the trends and data closely, act quickly to seize opportunities, and offer a distinctive guest experience that will outperform the market. 

The comeback: Straggling segments catch up

Since the pandemic, leisure demand has been so strong it has been easy to overlook other market segments that have been slower to rebound. However, with growth in leisure travel now at a virtual standstill, all bets are on a triple threat of market segments picking up the slack: international, corporate, and group travel. 

Here come the big spenders

In 2023, international tourism reached almost 90% of pre-pandemic levels , setting the stage for a full recovery in 2024. Inbound tourists tend to stay longer and spend as much as 90% more than domestic travelers, according to Aoife Roche of STR, speaking at Cloudbeds’ inaugural Passport UserCon . She also noted that strong demand from Asia Pacific is likely to fill any gaps in other regions.  

Back to business travel

After stalling and sputtering in recent years, global business travel is forecasted to zoom past pre-pandemic spending levels in 2024. Some of the recovery will be fueled by rate growth, whereas travel volume may still lag behind 2019 numbers. China is expected to lead the charge, reclaiming its position as the No. 1 outbound business travel market in the world.  

The more the merrier

Group travel made strong strides in 2023, and the momentum is anticipated to continue through 2024. This includes not only conference travel and small regional meetings but also team-building events, social groups, and group trips to sporting events like the Olympic Games in Paris. However, groups might not hit their usual haunts. Many conferences and events have shifted from large, urban cities to smaller, secondary markets, according to Hilton .

What does this mean for independent properties?

Chasing demand is about finding new business opportunities, and these market segments offer valuable ways to strengthen hotel performance. International travelers are generally less price-sensitive than domestic travelers, and they tend to stick around for a while. As our data indicates, more business travelers are working remotely and combining leisure activities on trips, increasing the average length of stay. And groups often book well in advance, providing a solid base upon which to build higher-rated business. 

Even properties that don’t host a lot of groups or business travelers can benefit from the compression they bring to a region. The local convention & visitors bureau (CVB) can keep hoteliers up to date on upcoming events and conferences , providing advanced notice of opportunities to increase rates.

Hotels that cater to diverse market segments enjoy stronger year-round demand and are better positioned to weather a softening in one or more segments. In 2024, the time may be ripe to start spreading the love.

• In 2024, hotel rates are forecasted to rise in most locations around the world and by as much as 17.5% in some cities. ( Amex GBT )
• In the next three to five years, China is set to become the world’s biggest outbound travel and tourism market. ( WTTC )
• 62% of business travelers more frequently blend business and personal travel today than in 2019. ( GBTA )

Inflation who? Travelers trade up

Inflation is heavy on the minds of consumers these days. Nevertheless, surveys indicate that people are unwilling to sacrifice travel or compromise on their tastes. Instead, they’re finding creative ways to trade up travel experiences.

Aspirational luxury

To experience a richer lifestyle on the road than at home, travelers are employing money-saving hacks such as traveling off-peak, during the week, and closer to home. Some are choosing destinations where the cost of living is relatively low, whereas others are buying a day pass or enjoying drinks at a luxury hotel (and posting proof on Instagram) while staying at a more affordable property.

Close enough: The quest for dupes

Popularized on TikTok, a dupe refers to a more affordable alternative to a popular but pricey product. Not only are dupe destinations less expensive, they also tend to be less crowded and less predictable. For travelers, this might mean choosing Quebec City over Paris or Liverpool over London. Already, one in three travelers has booked a dupe, according to Expedia .  

Postponing the payment, not the trip

“Buy Now, Pay Later” (BNPL) is the fastest-growing form of payment in the U.S. In travel, service providers like Affirm and Afterpay have partnered with Booking.com, Expedia, Airbnb, and select hotel companies to offer BNPL options, and the list is growing fast. In a survey from Atmosphere Research , four in 10 travelers said that a BNPL option had made it possible for them to take a trip.

While travelers may seek bargains in 2024, hotels still have bills to pay and staff to employ. Meeting demand for deals will require finding imaginative ways to make travelers feel they are paying less without slashing room rates.

Rather than being on sale all the time, hotels can protect rates by restricting discounts to times of low demand and targeting desirable business like advanced bookings and extended stays throughout the year. Reduced increments for premium rooms and suites can entice aspirational travelers to trade up, while charging premiums for conveniences like flexible cancellation, early check-in, and late check-out can boost total revenue.  

Often it’s the little extras and thoughtful touches that guests remember most, especially when on a tight budget. Throwing in value-adds such as an upgrade, free parking, welcome cocktail, or room amenities can wow guests without costing the hotel a lot of money. Additionally, offering a BNPL option will attract more bookings, especially if the economy slows down.

• Globally, 81% of travelers plan to travel the same or more in 2024 compared to 2023. ( Skyscanner )
• 64% of travelers aim to cut other areas of their personal spending to prioritize leisure travel. ( Forbes )
• 79% of consumers say they are likely to use BNPL service for hotel stays. ( Uplift )

The experience IS the destination

According to the old adage, it’s about the journey, not the destination, but in 2024, it’s all about the experience. After years of post-pandemic binge-buying, consumers are moving on from collecting stuff to collecting experiences. Here are three standout trends we’re observing.

Tour tourism

In 2023, world tours by Taylor Swift and Beyoncé demonstrated the power of tour tourism, bringing hotels significant bumps in revenue wherever they touched down. Hotels can expect an encore in 2024, with more shows from Tay Tay as well as Coldplay, Madonna, Pink, and other headliners hitting the global tour circuit. Almost 70% of travelers say they are more likely than ever to travel to a concert outside their hometown, according to Expedia .  

Memorable meals

This year, travelers are showing an insatiable appetite for culinary tourism. According to Skyscanner , 47% of U.S. travelers have booked a destination purely to visit a specific restaurant. For some, this may be experiencing Noma in Copenhagen, reputedly the world’s best restaurant, before it closes at year-end. For others, it may be heading to steamed dumpling stalls in Nepal, produce markets in Vietnam, or Cajun food trucks in New Orleans. 

Splashy trips

After last year’s record-breaking temperatures, more people will retreat to water destinations this year. But this is about more than lounging on floaties in the hotel pool. Activities on the roster include wild swims with dolphins in Mauritius, eco-diving among the mangrove forests in Yucatan, winter swims in Norway and Estonia, and island-hopping by front crawl in the Adriatic.

To tap into the experience trend, hotels should promote their proximity to popular activities, whether it’s a concert venue, popular restaurant, or unique attraction. Nearly two-thirds of travelers say they often or always book their hotel based on access to local experiences, according to Hilton .

Another effective tactic is to package overnight stays with tickets to a show, a dinner voucher for a local restaurant, or even concert swag. During the Eras Tour, Loews Hotels enticed Swifties to its properties by offering Swift-inspired cocktails, playlists, bracelet-making lessons, and photo backdrops. 

By signing up for notifications of upcoming concerts, sporting events, and festivals, hoteliers will receive a heads-up to raise rates and implement stay restrictions when demand is expected to spike. Properties can also utilize business intelligence and revenue management systems integrated with their PMS to track events and update rates in real-time. 

At the same time, operators should be careful not to neglect the most important experience of all: the guest experience. Unique, localized experiences are a major reason why travelers choose independent hotels over brands.

• 34% of U.S. travelers plan to attend a gig, music concert, or festival in 2024, including 50% of 25-to-34-year-olds. ( Skyscanner )
• During the first 53 concert nights of Taylor Swift’s 2023 Eras Tour, U.S. hotels pulled in an estimated $208 million in revenue. ( STR )
• 52% of travelers are keen to book a surprise trip where everything down to the destination is unknown until arrival. ( Booking.com )

Airbnbust? Long-term obstacles for short-term rentals

After substantial growth during the pandemic, the short-term rentals (STR) sector is experiencing serious pushback. Is this the beginning of the end?

Traditionally, a major draw for private rentals has been value: more space for less money. However, the pricing gap with hotels has narrowed, and travelers have been grumbling about misleading pricing tactics . Airbnb, in particular, has been assailed for advertising low prices only to produce sticker shock when fees are tacked on at checkout. 

At the same time, governments have been cracking down on STR operators, capping the number of licenses issued and the number of days properties can be rented out per year. New York City is the latest city to throw down the gauntlet, with strict new regulations that bar hosts from renting out an entire home and require them to be present during the guests’ stay. 

As a result of all this activity, whispers of an apocalyptic “Airbnbust” have spread online . Upon closer inspection, however, it appears that reports of the death of short-term rentals have been greatly exaggerated. 

While some secondary markets have experienced a glut in supply, overall demand has increased, while hotel rates climbed faster than rental rates last year . Reporting last year on the company’s most profitable third quarter in history, CEO Brian Chesky remarked, “I think we’re only scratching the surface.” The company also introduced transparency measures to display the total price, including fees, at the beginning of listings. 

• Globally, short-term rentals represent about 14.2% of the accommodation sector. ( Skift )
• Global revenue per available rental (RevPAR) in the STR sector grew by 5.7% in the first six months of 2023. ( TravelPulse )
• Demand for short-term rentals in the U.S. grew by 7.6% in August 2023 over the previous year, while hotel demand declined by 1.3%. ( CBRE )

Generative AI: Trusted travel advisor and 24/7 intern

2023 was the year generative artificial intelligence (AI) went mainstream. Since launching in late 2022, ChatGPT has amassed more than 180 million users worldwide. Not to be outdone, Google launched Gemini in December, an AI chatbot that comprehends and generates not only text but also audio, video, and images.

What’s truly exciting about AI chatbots is their potential as a trusted travel advisor, providing personalized information and recommendations on everything from flight routes to accommodation choices based on the traveler’s budget and preferences, as well as acting as a translator, tour guide, and concierge. For example, Navan has launched Hotel Concierge by Ava, an automated virtual assistant that provides recommendations tailored to the traveler’s individual preferences and booking patterns. 

However, one of the most significant impacts of AI is perhaps its potential to revolutionize the operational efficiency of independent hotels. Technological advancements have democratized access to AI tools, with forward-thinking tech providers creating innovative products with advanced AI and machine learning. This shift is fostering a new era where hotel operators, regardless of size, can harness AI to streamline operations and accelerate efficiencies. 

In 2024, we can expect AI to be meaningfully integrated into technology solutions to improve day-to-day operations for lodging businesses. From guest communication to revenue management and digital marketing, hoteliers will be able to use AI to enhance productivity and automate workflows, leaving more time for strategic decision-making.

• 48% of travelers now trust AI to plan their trips. ( Booking.com )
• 42% of travel executives agree that AI is most useful for using data to provide more personalized offerings. ( Skift )
• An estimated 60% of generative AI skeptics will use and value it in 2024, whether they realize it or not. ( Forrester )

Adapt or go obsolete: Next-gen hoteliers upgrade their skills

The nature of hospitality is changing, and a driving force is technology. Travelers are using more technology to plan trips and experience destinations, and hoteliers are using more technology to operate their properties and serve their guests. 

Today, technology automates an increasing array of tasks for hotel employees, from taking reservations, to updating rates and availability, to checking guests in and out. While humans are still running the show, roles and responsibilities are evolving. From front desk staff to general managers, the challenge today is to find one’s place in a tech-centric world. 

Growing demand for diverse skills

The irony of it all? The range of skills required of hotel staff has expanded, not contracted. Technology doesn’t replace the skills employees have always needed to be successful – hard skills like technical aptitude and soft skills like empathy, creativity, and teamwork. But it also demands an array of new skills.

Today’s hospitality leaders must be more technical, able to operate dozens of applications used in the hotel environment today. They must be more analytical, able to extract meaning and insights from massive amounts of data. And they must be more strategic, finding the ideal balance between technology and human touch that keeps guests and teams happy and loyal. 

There is also increasing demand for knowledge and skills in emerging tech fields such as generative AI, cloud computing, robotics, cybersecurity, internet of things, and virtual reality.

• An estimated 42% of business tasks will be automated by 2027. ( World Economic Forum )
• Globally, 91% of hotels use a PMS, 64% have a booking engine, and 33% have a channel manager. ( Skift )
• 100% of hoteliers say their IT budgets will either increase or hold steady in 2024. ( Hospitality Technology )

It’s time to rewrite the rules

When travel behavior shifts, hoteliers must change how they do business if they wish to stay competitive. In 2024, this means letting go of old habits and embracing new ways of doing things – in marketing, revenue management, operations, guest experience, and across the organization. 

The backbone of a successful hospitality business is modern technology. No longer can independent hoteliers allow themselves to be held back by manual processes and outdated software while competitors down the street leverage the speed and efficiency of automation and cloud technology. 

Nor can hoteliers rely on continued guest satisfaction and loyalty without unified data to understand and cater to guest preferences. To stay competitive, hotels need an integrated hospitality platform that is built to serve their unique needs and is scalable as their business grows and evolves.

Over the past decade, Cloudbeds has evolved from a scrappy startup to an industry leader by rewriting the rules. Today, we encourage our hotel partners to follow a similar path. More than ever, our team is committed to providing best-of-class technology to empower hoteliers to chase demand and elevate their businesses through the art of hospitality.

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The magazine of Glion Institute of Higher Education

• Six hospitality industry trends for 2023 and beyond

As well as being a member of our expert guest faculty, Mariana Palmeiro is a consultant to the global hospitality industry, specializing in the spa, wellness and health segments. Thus she’s perfectly placed to highlight six key trends she believes could most influence the business of hospitality in the coming year…

Having worked in the hospitality business for a long time, I feel we often underappreciate quite how resilient – and adaptive – this industry is.

In just the past couple of decades we’ve seen the hotel distribution model upended by the OTAs; a major competitor arrive in the shape of Airbnb (and its emulators); and then a global pandemic which forced hotels in many key markets to cease trading almost overnight, and for what turned out to be an extended period.

And yet the hospitality industry keeps on rolling; adapting to new realities and consistently treating trends as opportunities. Amid a backdrop of strong hotel development pipelines in many regions, I’ve selected a few of the key hospitality trends to be aware of, while also looking at how hoteliers are responding.

1. Welcoming the working nomad

With major employers like PwC embracing hybrid working models , and others such as Airbnb committing to work-from-anywhere policies , there’s a huge opportunity for the travel industry – and especially hospitality operators – to embrace this new generation of digital nomad remote workers who combine employment with international travel.

While accepting that there are many jobs that cannot be done remotely, the knowledge and services economy is less restrictive in this area, especially given the exponential rise in use of videoconferencing and collaborative working applications which was spurred by the constraints of lockdown.

For hotel operators, responding to this opportunity is about much more than just installing good Wi-Fi. There’s been a sea change in attitudes, too: these new generation remote workers are interested in community, in being among like-minded peers, and in enjoying a better balanced life. At the same time, when they are working to a deadline they don’t necessarily want to be surrounded by vacationers!

It means the age of the bland and forbidding hotel business center is over. I expect to see funkier coworking spaces established; also suites being reconfigured to include a desk/office setup as well as converting to a functional meeting space when required.

At the same time, I see a huge opportunity for travel destinations to create bespoke marketing programs to attract working nomads – ideally with tourism boards and hospitality companies working hand-in-hand to amplify the message as well as ensuring that promises are credible and can be delivered on the ground.

“It means the age of the bland and forbidding hotel business center is over. I expect to see funkier coworking spaces established; also suites being reconfigured to include a desk/office setup as well as converting to a functional meeting space when required.”

Mariana Palmeiro

2. The rise and rise of wellness tourism

As a hospitality consultant, I get more calls from hotels looking to reposition into health and wellness tourism than any other trend. And no wonder – this market is booming.

However, hotels need to understand that such a repositioning may not be as simple as it seems; nor is it without risk. Much depends on location: given that most hotels cannot afford to have full-time medical and wellness experts on the payroll, are such professionals available close by? Also, several brands are already operating successfully in this sphere, so it’s important to check the local competitive set before making a significant financial commitment.

Often, it may be better to look at smaller changes which can appeal to health-conscious guests without breaking the bank – something I call ‘light wellness’. Putting healthier choices in the minibar is a tiny gesture that can create a warm glow around your brand. In addition, it’s increasingly common now to offer pillow and mattress menus; but why not go one step further by introducing sleep and wake-up rituals aligned to circadian rhythm cycles?

My message is that you don’t necessarily have to open a bespoke vegan restaurant, or spend millions renovating your spa, to be thought of as a wellness-conscious hotel. That said, what you do spend should pay back, given that data shows health-conscious guests tend to be bigger spenders than average. This can be explained by the fact that they will happily pay for things like yoga sessions and personal trainers, as well as choosing the in-house F&B options because they trust them to produce healthier cooking instead of untried local competitors.

3. Embracing technology in spa & wellness

We are now much more engaged with our personal health and wellness; a trend which has been accelerated by a combination of the Covid pandemic and the explosion in wearable fitness technology.

For the spa & wellness industry, this offers the promise of both creating an opportunity and nullifying a threat simultaneously.

How? Because new technologies like hyperbaric chambers (see above), cryotherapy and the like are more demonstrably effective than many ‘traditional’ spa rituals and treatments. At the same time, working with these scientifically-proven treatments can also create fewer but more interesting and better paid spa & wellness roles; something that’s essential for a segment which is struggling to attract workers amid the wider ‘war for talent’ in hospitality.

4. Deploying smart technology in hotels

The hotel industry has an unbalanced relationship with technology. We tend not to be pioneers in technological development, choosing instead to take on applications developed for the commercial real estate sector, airports and the home, then look at how they can be integrated into so-called smart hotels.

But the hotel reception is not the same as an airport check-in – the need for a warmer welcome and a degree of personalization is much greater in a hotel setting. If I’m your guest, why not give me the option to check-in from a smartphone app while I’m still in my taxi heading from the airport? In that way I know there’s a room waiting for me, and when I arrive I can head straight up to it without delay.

Crucially, though, if I wish for some human interaction there are employees who have been liberated from behind the reception desk and are in the lobby to greet me, answer my questions and give me tips on the best places to go for food, drinks or sightseeing. As a guest, it immediately makes me feel that the hotel is well integrated into its surrounding community.

This kind of customer-facing role requires excellent soft skills (as well as an encyclopedic knowledge of the destination) and is thus more rewarding both professionally and potentially in terms of remuneration. If you’re a ‘people person’ it’s a role you can enjoy and make your own – and these are exactly the sort of jobs that we need to offer as an industry if we want to attract and retain the talent we need.

5. Marketing gets ‘transformational’

We often talk about hospitality being part of the wider ‘Experience Economy’, which was a term coined by Pine & Gilmore just before the turn of the millennium.

More recently, the same authors have developed the notion of the ‘Transformation Economy’, where experiences are elevated from mere enjoyment to actual personal transformation.

What does this mean for hospitality marketing? I think we will see a shift in messaging to amplify this notion of transformation through travel experiences, particularly around the notion of health and wellness. Messaging will also become even more personalized – down to a granular level – especially in the luxury segment. The advantage with digitalization is that it makes such moves easier to pull off.

The message will thus evolve to something like “I see that you are traveling because you are trying to change something in your life. We can be part of that journey by being the place where you sleep, where you look after your health and fitness, or by becoming your place of work while you explore how your career can move forwards”.

One of the brands already doing this successfully is Equinox, which began in fitness but has now opened what it calls “the fittest hotel on Earth” (pictured above) in New York’s ultra-trendy Hudson Yards. The promise is that a stay there will help you on your personal journey of being healthier, more focused and higher performing. It turns the transformation economy from theory to real-world practice!

6. Can the hotel ‘brand explosion’ last?

While the other trends I’ve highlighted can primarily be seen as opportunities rather than risks, this sixth and final one is perhaps a little more open to debate. It concerns the fragmentation of the hotel sector into a plethora of sub-segments, each with their own stable of competing brands.

While choice is generally a good thing for a consumer, has this process gone too far in the hotel business? Are customers becoming more confused than inspired by being faced with so many brands? Will they feel that once independent brands which are now part of a multinational group can still deliver authentic experiences?

I personally think that such concerns are valid, and that in time we may see some rationalization as the larger operators focus on one brand in lifestyle, one in boutique, etc.

These are just six hospitality trends I’ve chosen to highlight today. There are plenty more items on the hospitality leader’s strategic agenda; some of which – such as social responsibility – may ultimately prove more impactful than those mentioned above. And the red thread which runs through most if not all of them is the hotel industry’s ongoing battle to attract and retain staff.

Much of what I’ve talked about is centered on delivering transformational, ultra-personalized experiences to guests. But how can a hotel do this successfully if its frontline workforce is changing every six months?

As an industry, we need to address the way we engage and excite young people to work in hospitality; deploy technology to give us more freedom to invest in people and give them roles that captivate both them and their guests; and reclaim that notion of personalized, human-to-human interactions which Airbnb used to such great effect when it first emerged as a challenger to the traditional hotel business.

If the hotel industry can pull this off, it will deliver exceptional growth, because this is the way that guest demand is going.

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Marketing Tourism and Hospitality

Concepts and Cases

• © 2021
• Richard George 0

ICON College of Technology and Management/Falmouth University, London, UK

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• Explores the fundamental principles of marketing applied to tourism and hospitality businesses
• Includes a chapter on the most important issues in marketing tourism
• Places special emphasis on smaller tourism businesses

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Table of contents (14 chapters)

Front matter, understanding marketing in the tourism and hospitality industry, tourism and hospitality marketing principles.

Richard George

Characteristics of Tourism and Hospitality Marketing

Understanding the tourism and hospitality market, tourism and hospitality consumer behaviour, tourism and hospitality marketing research, designing the tourism and hospitality marketing strategy, tourism and hospitality marketing planning, the tourism and hospitality marketing environment, market segmentation, targeting, and positioning, implementing the tourism and hospitality marketing mix, tourism and hospitality products, branding, and pricing, tourism distribution, promoting and advertising tourism and hospitality products, designing the tourism and hospitality promotions mix, digital marketing in tourism and hospitality, understanding tourism and hospitality marketing issues, quality service experiences through internal and relationship marketing, marketing tourism destinations.

• destination branding
• place branding
• emerging economies
• developing countries
• case studies

About this book

This textbook explores the fundamental principles of marketing applied to tourism and hospitality businesses, placing special emphasis on SMEs in the international tourism industry. It includes examples from a wide range of destinations, from emerging markets to high-income countries. Taking a comprehensive approach, the book covers the whole spectrum of tourism and hospitality marketing including destination marketing, marketing research, consumer behaviour, and digital and social media marketing. Practical in focus, it gives students the tools, techniques, and underlying theory required to design and implement successful tourism marketing plans.

Chapters contain in-depth case studies, including companies like Marine Dynamics Shark Tours (South Africa), Reality Tours & Travel (Mumbai, India), and Makeover Tours (Turkey). Thematic case studies include ‘Halal Tourism in Southeast Asia’, and ‘Marketing and Branding Rwanda’. These illustrate key concepts and theory, with definitions, key summaries, and discussion questions providing further insights. This textbook is ideal for undergraduate and postgraduate students looking for a comprehensive text with a practical orientation. 

Authors and Affiliations

About the author.

Richard George  is a senior lecturer at ICON College of Technology & Management/Falmouth University in the UK. He was formerly Associate Professor of Marketing at the University of Cape Town (UCT) and Director of the Tourism Research Unit at UCT. His research interests include safety and security issues and consumer behaviour in the travel and tourism industry. He holds a PhD in Marketing from UCT, South Africa. 

Bibliographic Information

Book Title : Marketing Tourism and Hospitality

Book Subtitle : Concepts and Cases

Authors : Richard George

DOI : https://doi.org/10.1007/978-3-030-64111-5

Publisher : Palgrave Macmillan Cham

eBook Packages : Business and Management , Business and Management (R0)

Copyright Information : The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG 2021

Softcover ISBN : 978-3-030-64110-8 Published: 09 May 2021

eBook ISBN : 978-3-030-64111-5 Published: 08 May 2021

Edition Number : 1

Number of Pages : XXIII, 500

Number of Illustrations : 60 b/w illustrations, 75 illustrations in colour

Topics : Tourism Management , Marketing

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12 key trends shaping the hospitality industry in 2024

In an era defined by rapid technological advancements and shifting consumer preferences, the hospitality industry stands at the forefront of innovation and adaptation. As we step into 2024, the landscape continues to evolve, presenting both challenges and opportunities for businesses in the sector. Understanding and harnessing these emerging trends will be pivotal in shaping the future of hospitality. Here are the trends we’re reading about that are key priorities for hospitality businesses in 2024:  

1. Sustainability as a priority

With increasing global awareness of environmental issues, sustainability has transitioned from a buzzword to a core principle in the hospitality industry. Guests are actively seeking eco-friendly accommodations and experiences. In 2024, sustainability will continue to be a defining factor in consumer choices and brand loyalty.   

Dr Newman, Chief Sustainability Officer for EarthCheck (previously Banyan Tree Group’s Chief Sustainability Officer) says, “There’s a willingness for many companies to engage with ESG (Environmental, Social, and Governance) issues, but many simply don’t know where to start.”   

Many hotels are responding by gaining more knowledge and understanding around adopting green practices, from energy-efficient buildings and waste reduction initiatives to locally sourced products and sustainable food options. Looking for more sustainability ideas? Check out the EarthCheck courses on Typsy here.

2. Cultural diversity and inclusivity

3. health and wellness-centric offerings.

The pandemic has elevated health consciousness, propelling the demand for wellness-focused travel experiences. According to a survey by Booking.com, over 70% of travelers prioritize wellness on their trips. In 2024, hotels and resorts will be expected to expand their wellness amenities, incorporating yoga studios, meditation spaces, healthier menu options, and fitness programs to cater to this growing trend.  

Learning with Typsy is practical, effective, and fun! And best of all, you can access Typsy's 1500+ lessons when it suits you. Learn your way - starting today.

4. Rise of remote work and bleisure travel

The concept of work has transformed significantly, with remote work becoming more prevalent. This shift has given rise to ' b leisure ' travel – a blend of business and leisure trips. Hotels are adapting their amenities and services to accommodate this hybrid trend. Specialized packages ca tering to remote workers, offering co-working spaces, high-speed internet, and unique leisure experiences, are gaining traction.  

5. Personalized experiences through AI and big data with advanced analytics

The use of advanced analytics to personalize guest experiences is on the rise. According to a report by Accenture, 83% of consumers are willing to share their data for a more personalized experience. Hospitality businesses are leverag ing this d ata to anticip ate guest needs, preferences, and even emotional states, creating hyper-personalized services that resonate with individual travelers.

6. Rise of experience-driven lodging

The shift from 'staying' to 'experiencing' has transformed the lodging landscape. Unique accommodations such as treehouses, glamping sites, and boutique stays are gaining popularity. Statista reports a 42% increase in demand for unique accommodations . As travelers seek distinctive and memorable experiences, hotels are diversifying their offerings to cater to this demand, emphasizing local culture and authenticity.

7. Focus on local talent development

In many regions, a shift towards investing in local talent development programs to mitigate skill gaps will be seen. Ray Pulungan, CEO of Indonesian company, PINTAR says he is seeing an increase in requests for talent development and placement solutions to support the increasing need for workers in the hospitality industry.  

Organizations including VTIC have been running programs to support local talent development across tourism regions in Victoria, Australia to help address the skills gap. Hospitality businesses will look to collaborate with educational institutions, vocational schools, or online training programs to nurture and upskill local talent, reducing reliance on overseas recruitment for certain roles.  

8. Strategic global partnerships for talent acquisition

Hospitality businesses will also look further afield and seek out st rategic partnerships or alliances with international recruitment agencies, educational institutions, or HR firms specialized in sourcing global talent. Collaborations with entities abroad may facilitate smoother and more effective recruitment processes while ensuring compliance with changing regulations. Sometimes visa restrictions impact the ease of international recruitment, however, Governments may implement or revise immigration policies tha t impa ct the recruitment of international staff. Changes in visa regulations, work permits, or immigration laws might influence how easily hospitality businesses can source talent from abroad. 

9. Focus on retention and employee experience

Retaining skilled employees will be a priority. Hospitality companies will invest in improving the overall employee experience, offering competitive benefits, career development and training opportunities , recognition programs, and fostering a positive work culture. Typsy CEO, Jon Plowright says there is increased interest in blending online training and face-to-face learning as an efficient way to upskill teams at scale . Moving forward, the emphasis on creating efficiencies, where it makes sense, and enhancing convenience will persist. Engaged and satisfied employees are more likely to deliver superior guest experiences, impacting the overall success of the business.

10. Contactless technology and seamless operations

The aftermath of the pandemic expedited the adoption of contactless technologies and hospitality management software . QR codes, mobile check-ins, and digital keys have become comm on pl ace for guests , as have re staurant boo king tec hnologies that not only create a great expe rience for the cus tomer bu t can also h el p drive more revenue f or businesses. A great example of optim izing technolog y is from Tano shi Grou p wh ere they s aw 35 % more pe ak covers, doubled their eve nt bookings, and saw a 30% reduc ti on in group no- shows by using reservation management software, ResDiary. Investments in te ch in fr astructu re for smoother o perat ions, alon g with th e incorporation of IoT de vices for smar t ro oms, will remain a pr iority.

11. Cryptocurrency and blockchain integration

The adoption of cryptocurrencies and blockchain technology is gaining momentum in the hospitality sector. According to Statista, the global blockchain market in hospitality is projected to grow to over $7.6 billion by 2024. Blockchain offers secure transactions, loyalty programs, and enhanced guest data protection, while cryptocurrencies provide an alternative payment method catering to tech-savvy travelers.

12. Flexible booking options and subscription services

The industry is witnessing a shift towards flexible booking options and subscription-based models. Guests seek more control over their reservations, with options for cancellations and modifications. Subscription services for frequent travelers, offering exclusive perks and discounts, are gaining popularity, fostering long-term relationships with customers.

The hospitality sector is a dynamic ecosystem continually adapting to meet the evolving needs and expectations of its patrons. As we say goodbye to 2023, the industry faces a multitude of transformative trends, each playing a crucial role in shaping its trajectory.   

Embracing these trends isn't merely a choice but a necessity for businesses aiming to thrive in this dynamic landscape. By prioritizing personalization, sustainability, technology integration, staff training and development, flexibility, and innovative guest experiences, hospitality brands can position themselves at the forefront of this evolution, catering to the evolving needs and desires of their guests while staying ahead as an employer of choice in a competitive market.  

Adaptability and a customer-centric approach will be the cornerstone for success, propelling the industry towards a future defined by unparalleled experiences and heightened guest satisfaction.   

An exciting year awaits us in 2024!  

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The future of tourism: Bridging the labor gap, enhancing customer experience

As travel resumes and builds momentum, it’s becoming clear that tourism is resilient—there is an enduring desire to travel. Against all odds, international tourism rebounded in 2022: visitor numbers to Europe and the Middle East climbed to around 80 percent of 2019 levels, and the Americas recovered about 65 percent of prepandemic visitors 1 “Tourism set to return to pre-pandemic levels in some regions in 2023,” United Nations World Tourism Organization (UNWTO), January 17, 2023. —a number made more significant because it was reached without travelers from China, which had the world’s largest outbound travel market before the pandemic. 2 “ Outlook for China tourism 2023: Light at the end of the tunnel ,” McKinsey, May 9, 2023.

Recovery and growth are likely to continue. According to estimates from the World Tourism Organization (UNWTO) for 2023, international tourist arrivals could reach 80 to 95 percent of prepandemic levels depending on the extent of the economic slowdown, travel recovery in Asia–Pacific, and geopolitical tensions, among other factors. 3 “Tourism set to return to pre-pandemic levels in some regions in 2023,” United Nations World Tourism Organization (UNWTO), January 17, 2023. Similarly, the World Travel & Tourism Council (WTTC) forecasts that by the end of 2023, nearly half of the 185 countries in which the organization conducts research will have either recovered to prepandemic levels or be within 95 percent of full recovery. 4 “Global travel and tourism catapults into 2023 says WTTC,” World Travel & Tourism Council (WTTC), April 26, 2023.

Longer-term forecasts also point to optimism for the decade ahead. Travel and tourism GDP is predicted to grow, on average, at 5.8 percent a year between 2022 and 2032, outpacing the growth of the overall economy at an expected 2.7 percent a year. 5 Travel & Tourism economic impact 2022 , WTTC, August 2022.

So, is it all systems go for travel and tourism? Not really. The industry continues to face a prolonged and widespread labor shortage. After losing 62 million travel and tourism jobs in 2020, labor supply and demand remain out of balance. 6 “WTTC research reveals Travel & Tourism’s slow recovery is hitting jobs and growth worldwide,” World Travel & Tourism Council, October 6, 2021. Today, in the European Union, 11 percent of tourism jobs are likely to go unfilled; in the United States, that figure is 7 percent. 7 Travel & Tourism economic impact 2022 : Staff shortages, WTTC, August 2022.

There has been an exodus of tourism staff, particularly from customer-facing roles, to other sectors, and there is no sign that the industry will be able to bring all these people back. 8 Travel & Tourism economic impact 2022 : Staff shortages, WTTC, August 2022. Hotels, restaurants, cruises, airports, and airlines face staff shortages that can translate into operational, reputational, and financial difficulties. If unaddressed, these shortages may constrain the industry’s growth trajectory.

The current labor shortage may have its roots in factors related to the nature of work in the industry. Chronic workplace challenges, coupled with the effects of COVID-19, have culminated in an industry struggling to rebuild its workforce. Generally, tourism-related jobs are largely informal, partly due to high seasonality and weak regulation. And conditions such as excessively long working hours, low wages, a high turnover rate, and a lack of social protection tend to be most pronounced in an informal economy. Additionally, shift work, night work, and temporary or part-time employment are common in tourism.

The industry may need to revisit some fundamentals to build a far more sustainable future: either make the industry more attractive to talent (and put conditions in place to retain staff for longer periods) or improve products, services, and processes so that they complement existing staffing needs or solve existing pain points.

One solution could be to build a workforce with the mix of digital and interpersonal skills needed to keep up with travelers’ fast-changing requirements. The industry could make the most of available technology to provide customers with a digitally enhanced experience, resolve staff shortages, and improve working conditions.

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Complementing concierges with chatbots.

The pace of technological change has redefined customer expectations. Technology-driven services are often at customers’ fingertips, with no queues or waiting times. By contrast, the airport and airline disruption widely reported in the press over the summer of 2022 points to customers not receiving this same level of digital innovation when traveling.

Imagine the following travel experience: it’s 2035 and you start your long-awaited honeymoon to a tropical island. A virtual tour operator and a destination travel specialist booked your trip for you; you connected via videoconference to make your plans. Your itinerary was chosen with the support of generative AI , which analyzed your preferences, recommended personalized travel packages, and made real-time adjustments based on your feedback.

Before leaving home, you check in online and QR code your luggage. You travel to the airport by self-driving cab. After dropping off your luggage at the self-service counter, you pass through security and the biometric check. You access the premier lounge with the QR code on the airline’s loyalty card and help yourself to a glass of wine and a sandwich. After your flight, a prebooked, self-driving cab takes you to the resort. No need to check in—that was completed online ahead of time (including picking your room and making sure that the hotel’s virtual concierge arranged for red roses and a bottle of champagne to be delivered).

While your luggage is brought to the room by a baggage robot, your personal digital concierge presents the honeymoon itinerary with all the requested bookings. For the romantic dinner on the first night, you order your food via the restaurant app on the table and settle the bill likewise. So far, you’ve had very little human interaction. But at dinner, the sommelier chats with you in person about the wine. The next day, your sightseeing is made easier by the hotel app and digital guide—and you don’t get lost! With the aid of holographic technology, the virtual tour guide brings historical figures to life and takes your sightseeing experience to a whole new level. Then, as arranged, a local citizen meets you and takes you to their home to enjoy a local family dinner. The trip is seamless, there are no holdups or snags.

This scenario features less human interaction than a traditional trip—but it flows smoothly due to the underlying technology. The human interactions that do take place are authentic, meaningful, and add a special touch to the experience. This may be a far-fetched example, but the essence of the scenario is clear: use technology to ease typical travel pain points such as queues, misunderstandings, or misinformation, and elevate the quality of human interaction.

Travel with less human interaction may be considered a disruptive idea, as many travelers rely on and enjoy the human connection, the “service with a smile.” This will always be the case, but perhaps the time is right to think about bringing a digital experience into the mix. The industry may not need to depend exclusively on human beings to serve its customers. Perhaps the future of travel is physical, but digitally enhanced (and with a smile!).

Digital solutions are on the rise and can help bridge the labor gap

Digital innovation is improving customer experience across multiple industries. Car-sharing apps have overcome service-counter waiting times and endless paperwork that travelers traditionally had to cope with when renting a car. The same applies to time-consuming hotel check-in, check-out, and payment processes that can annoy weary customers. These pain points can be removed. For instance, in China, the Huazhu Hotels Group installed self-check-in kiosks that enable guests to check in or out in under 30 seconds. 9 “Huazhu Group targets lifestyle market opportunities,” ChinaTravelNews, May 27, 2021.

Technology meets hospitality

In 2019, Alibaba opened its FlyZoo Hotel in Huangzhou, described as a “290-room ultra-modern boutique, where technology meets hospitality.” 1 “Chinese e-commerce giant Alibaba has a hotel run almost entirely by robots that can serve food and fetch toiletries—take a look inside,” Business Insider, October 21, 2019; “FlyZoo Hotel: The hotel of the future or just more technology hype?,” Hotel Technology News, March 2019. The hotel was the first of its kind that instead of relying on traditional check-in and key card processes, allowed guests to manage reservations and make payments entirely from a mobile app, to check-in using self-service kiosks, and enter their rooms using facial-recognition technology.

The hotel is run almost entirely by robots that serve food and fetch toiletries and other sundries as needed. Each guest room has a voice-activated smart assistant to help guests with a variety of tasks, from adjusting the temperature, lights, curtains, and the TV to playing music and answering simple questions about the hotel and surroundings.

The hotel was developed by the company’s online travel platform, Fliggy, in tandem with Alibaba’s AI Labs and Alibaba Cloud technology with the goal of “leveraging cutting-edge tech to help transform the hospitality industry, one that keeps the sector current with the digital era we’re living in,” according to the company.

Adoption of some digitally enhanced services was accelerated during the pandemic in the quest for safer, contactless solutions. During the Winter Olympics in Beijing, a restaurant designed to keep physical contact to a minimum used a track system on the ceiling to deliver meals directly from the kitchen to the table. 10 “This Beijing Winter Games restaurant uses ceiling-based tracks,” Trendhunter, January 26, 2022. Customers around the world have become familiar with restaurants using apps to display menus, take orders, and accept payment, as well as hotels using robots to deliver luggage and room service (see sidebar “Technology meets hospitality”). Similarly, theme parks, cinemas, stadiums, and concert halls are deploying digital solutions such as facial recognition to optimize entrance control. Shanghai Disneyland, for example, offers annual pass holders the option to choose facial recognition to facilitate park entry. 11 “Facial recognition park entry,” Shanghai Disney Resort website.

Automation and digitization can also free up staff from attending to repetitive functions that could be handled more efficiently via an app and instead reserve the human touch for roles where staff can add the most value. For instance, technology can help customer-facing staff to provide a more personalized service. By accessing data analytics, frontline staff can have guests’ details and preferences at their fingertips. A trainee can become an experienced concierge in a short time, with the help of technology.

Apps and in-room tech: Unused market potential

According to Skift Research calculations, total revenue generated by guest apps and in-room technology in 2019 was approximately $293 million, including proprietary apps by hotel brands as well as third-party vendors. 1 “Hotel tech benchmark: Guest-facing technology 2022,” Skift Research, November 2022. The relatively low market penetration rate of this kind of tech points to around $2.4 billion in untapped revenue potential (exhibit).

Even though guest-facing technology is available—the kind that can facilitate contactless interactions and offer travelers convenience and personalized service—the industry is only beginning to explore its potential. A report by Skift Research shows that the hotel industry, in particular, has not tapped into tech’s potential. Only 11 percent of hotels and 25 percent of hotel rooms worldwide are supported by a hotel app or use in-room technology, and only 3 percent of hotels offer keyless entry. 12 “Hotel tech benchmark: Guest-facing technology 2022,” Skift Research, November 2022. Of the five types of technology examined (guest apps and in-room tech; virtual concierge; guest messaging and chatbots; digital check-in and kiosks; and keyless entry), all have relatively low market-penetration rates (see sidebar “Apps and in-room tech: Unused market potential”).

While apps, digitization, and new technology may be the answer to offering better customer experience, there is also the possibility that tourism may face competition from technological advances, particularly virtual experiences. Museums, attractions, and historical sites can be made interactive and, in some cases, more lifelike, through AR/VR technology that can enhance the physical travel experience by reconstructing historical places or events.

Up until now, tourism, arguably, was one of a few sectors that could not easily be replaced by tech. It was not possible to replicate the physical experience of traveling to another place. With the emerging metaverse , this might change. Travelers could potentially enjoy an event or experience from their sofa without any logistical snags, and without the commitment to traveling to another country for any length of time. For example, Google offers virtual tours of the Pyramids of Meroë in Sudan via an immersive online experience available in a range of languages. 13 Mariam Khaled Dabboussi, “Step into the Meroë pyramids with Google,” Google, May 17, 2022. And a crypto banking group, The BCB Group, has created a metaverse city that includes representations of some of the most visited destinations in the world, such as the Great Wall of China and the Statue of Liberty. According to BCB, the total cost of flights, transfers, and entry for all these landmarks would come to $7,600—while a virtual trip would cost just over $2. 14 “What impact can the Metaverse have on the travel industry?,” Middle East Economy, July 29, 2022.

The metaverse holds potential for business travel, too—the meeting, incentives, conferences, and exhibitions (MICE) sector in particular. Participants could take part in activities in the same immersive space while connecting from anywhere, dramatically reducing travel, venue, catering, and other costs. 15 “ Tourism in the metaverse: Can travel go virtual? ,” McKinsey, May 4, 2023.

The allure and convenience of such digital experiences make offering seamless, customer-centric travel and tourism in the real world all the more pressing.

Three innovations to solve hotel staffing shortages

Is the future contactless.

Given the advances in technology, and the many digital innovations and applications that already exist, there is potential for businesses across the travel and tourism spectrum to cope with labor shortages while improving customer experience. Process automation and digitization can also add to process efficiency. Taken together, a combination of outsourcing, remote work, and digital solutions can help to retain existing staff and reduce dependency on roles that employers are struggling to fill (exhibit).

Depending on the customer service approach and direct contact need, we estimate that the travel and tourism industry would be able to cope with a structural labor shortage of around 10 to 15 percent in the long run by operating more flexibly and increasing digital and automated efficiency—while offering the remaining staff an improved total work package.

Outsourcing and remote work could also help resolve the labor shortage

While COVID-19 pushed organizations in a wide variety of sectors to embrace remote work, there are many hospitality roles that rely on direct physical services that cannot be performed remotely, such as laundry, cleaning, maintenance, and facility management. If faced with staff shortages, these roles could be outsourced to third-party professional service providers, and existing staff could be reskilled to take up new positions.

In McKinsey’s experience, the total service cost of this type of work in a typical hotel can make up 10 percent of total operating costs. Most often, these roles are not guest facing. A professional and digital-based solution might become an integrated part of a third-party service for hotels looking to outsource this type of work.

One of the lessons learned in the aftermath of COVID-19 is that many tourism employees moved to similar positions in other sectors because they were disillusioned by working conditions in the industry . Specialist multisector companies have been able to shuffle their staff away from tourism to other sectors that offer steady employment or more regular working hours compared with the long hours and seasonal nature of work in tourism.

The remaining travel and tourism staff may be looking for more flexibility or the option to work from home. This can be an effective solution for retaining employees. For example, a travel agent with specific destination expertise could work from home or be consulted on an needs basis.

In instances where remote work or outsourcing is not viable, there are other solutions that the hospitality industry can explore to improve operational effectiveness as well as employee satisfaction. A more agile staffing model  can better match available labor with peaks and troughs in daily, or even hourly, demand. This could involve combining similar roles or cross-training staff so that they can switch roles. Redesigned roles could potentially improve employee satisfaction by empowering staff to explore new career paths within the hotel’s operations. Combined roles build skills across disciplines—for example, supporting a housekeeper to train and become proficient in other maintenance areas, or a front-desk associate to build managerial skills.

Where management or ownership is shared across properties, roles could be staffed to cover a network of sites, rather than individual hotels. By applying a combination of these approaches, hotels could reduce the number of staff hours needed to keep operations running at the same standard. 16 “ Three innovations to solve hotel staffing shortages ,” McKinsey, April 3, 2023.

Taken together, operational adjustments combined with greater use of technology could provide the tourism industry with a way of overcoming staffing challenges and giving customers the seamless digitally enhanced experiences they expect in other aspects of daily life.

In an industry facing a labor shortage, there are opportunities for tech innovations that can help travel and tourism businesses do more with less, while ensuring that remaining staff are engaged and motivated to stay in the industry. For travelers, this could mean fewer friendly faces, but more meaningful experiences and interactions.

Urs Binggeli is a senior expert in McKinsey’s Zurich office, Zi Chen is a capabilities and insights specialist in the Shanghai office, Steffen Köpke is a capabilities and insights expert in the Düsseldorf office, and Jackey Yu is a partner in the Hong Kong office.

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The top tourism and travel marketing trends for 2023.

By: Russ Shumaker on March 6, 2023

Travel and tourism have experienced significant disruption over the past three years, from closing down during the early pandemic to a slow rebound that includes more domestic destinations.

Still, 2023 is predicted to be a big year for the travel industry. Despite inflation and increasing airline prices, tourism has proven to be resilient.

Source: eMarketer

According to the U.S. Travel Association , domestic leisure travel surpassed levels before the pandemic. But domestic business travel and international travel still face some headwinds.

Tourism marketing post-pandemic has evolved to keep up with the latest travel industry trends . So the question for travel brands is, how relevant are your marketing strategies for today's tourism consumers?

With so many changes in the industry, last year's travel marketing practices aren't always relevant to the current economy. Have you pivoted and changed your game plan to accommodate the emerging trends in tourism , and have you implemented the latest digital marketing strategies that will work best for your travel or hospitality business?

With the three busiest domestic travel months just a couple of months away, tourism companies need to get a jumpstart in marketing their businesses. To execute a winning digital marketing strategy , you should first become familiar with the top tourism marketing trends in 2023.

7 Travel Marketing Trends for 2023

According to Statista , the U.S. tourism and travel market is expected to be worth approximately $190 billion in 2023. If you want your travel or hospitality company to get its fair share of the pie, you'll need to implement the latest tourism marketing trends to grow your brand.

Trend #1: Focus on the Customer Experience

People are tired, stressed, and ready to have meaningful experiences away from home. And when they finally get a vacation, they expect it to be top-level.

An essential travel industry trend in 2023 will include consumers booking with tourism companies that provide a superior customer experience. Many consumers will even pay more to get it.

On the other hand, 76% of consumers will avoid doing business with a company after just one poor experience.

This means creating thoughtful and memorable customer experiences for travel brands while improving their interactions.

It's vital to achieve this at every stage of the buyer journey . For instance, consider a virtual tour to cater to consumers who are exploring their options and are planning a trip.

A virtual tour can highlight the benefits of booking with you while including information about what makes the destination special and what your customers can do locally while there.

Doing so can offer an immersive experience that will make them feel more connected, and they will want to experience more of what you can offer them.

Another idea is partnering with local hospitality businesses in providing discounts or other incentives. For example, if you have a hotel business , you can build relationships with local touring companies, coffee shops, restaurants , theaters , or other hospitality venues.

You can even survey your customers to learn more about their interests, then tailor recommendations based on that.

Trend #2: Go the Extra Mile With Personalization

Customer recommendations are just one way to appeal to your target consumers on a more personal level.

Personalized marketing for travel and tourism brands is essential to succeed in 2023. You can achieve this by personalizing promotions and special offers, including user-generated content such as reviews , and tailoring email campaigns that appeal to each customer at the individual level.

Tourism customers want more engagement with the brands they do business with. Your messaging and digital marketing should show that you understand your target audience.

To be successful at personalization strategies, your brand must learn to leverage insights on customer data and understand how to use consumer behavior to its advantage.

Because the average tourism company is understandably focused on running its business, many partner with a digital marketing firm to better leverage these technologies.

Trend #3: Provide Wellness Experiences

Grand View Research said the wellness tourism market was worth $814.6 billion in 2022. And it's expected to grow in 2023.

Last year, travel consumers sought wellness activities more than in previous years. This is likely due to people emphasizing their well-being more after dealing with heightened physical and psychological stress over the past two years.

Source: Kamalaya Koh Samui Wellness Retreats

For this reason, many are seeking retreat-type experiences to renew their bodies and minds. Many consumers have already implemented yoga, therapy, healthier eating, and other wellness practices in their everyday lives. They expect to be able to continue these experiences when traveling away from home while also looking for new adventures.

Your travel brand can meet these needs by including a list of local wellness offerings on your website. These include spas, hiking trails, a hot spring soak, wellness or meditation retreat, etc.

Trend #4: Consider Budget-Friendly Experiences

While many Americans will be keen to travel, most will stick to domestic travel, and some will seek more budget-friendly options.

Instead of luxury resorts and expensive vacations, Americans' travel plans in 2023 include visiting family and friends, road trips, hitting the beach, camping, or celebrating an important milestone.

And although American consumers still plan to spend big in the coming months, 46% say that inflation will alter their plans. To counter-act higher prices, 23% plan to travel in the off-season, while 21% consider destinations that cost less than a desired location.

An essential key for travel brands will be implementing a marketing strategy to attract budget-conscious travelers without compromising your brand's quality or marring your reputation with high-end customers.

You can achieve this by publishing blog posts that interest budget-conscious travelers and driving traffic to these blogs using paid ads . Your content strategy might include a list of local activities that are free or won't break the budget, buy-one-get-one-free specials, or limited-time offers during off-seasons. When posting, have stories about local folklore and community events, such as tours and festivals unique to the area.

You can also consider adding a loyalty program to foster long-term customer loyalty. All these things will show consumers that you are empathetic about how the economy impacts them.

These strategies can also position you as a local expert while creating interest among all travelers, not just those on a tight budget.

Don't forget to share your posts across all your social media channels.

Trend #5: Don't Underestimate the Power of an Optimized Google Business Profile

It makes sense that one of the best digital marketing strategies for any business, tourism companies included, is to claim a Google Business Profile and ensure that it's fully optimized. After all, Google is often the first place consumers search for travel information.

What's surprising is that 40% of businesses don't claim a Google Business Profile, even though it's free.

So think of it this way. If you claim your profile, you'll have an advantage over a competitor that doesn't.

Google has also increased what is allowed in the listing. For instance, you can include photos, posts, special offers, and more to engage better consumers interested in your products or services.

A Google Business Profile is a great way to increase your visibility. The average business gets 33 clicks a month from its profile (it shouldn't be hard to beat that average). Also, more than 50% of people who interact with your profile are likely to visit your website.

Finally, you can utilize your profile to establish and maintain your online reputation through Google reviews. According to Power Reviews , 98% of consumers feel that reviews are important when purchasing. So, it's something you should strongly consider for the review-conscious consumer.

Trend #6: Remember That Paid Search is Still Vital in 2023

Paid search advertising is still king for travel brands. It's projected that in 2023, more than 55% of tourism companies will earmark their marketing budgets for paid search ads.

Therefore, it's vital to maintain a robust search presence to attract users to your website . Because chances are, your competition will.

A major travel industry trend in 2023 will see tourism consumers wanting more convenient and expedited experiences.

Paid search prominently displays your travel business as a top option when consumers search for a company like yours in the desired location.

Users rarely scroll down the list and choose businesses at the bottom of the barrel. They'll dive deeper into what's in front of them. So it's a good idea to make it easier for them to find you through paid search listings.

Trend #7: Support Eco-Friendly Initiatives

Consumers had already pivoted toward sustainability, but the pandemic reminded them of how our actions impact our environment.

During the first lockdown, it was discovered that there was 33% less air pollution because of the lack of air travel.

While it isn't sustainable that planes stay grounded forever, consumers are aware that small initiatives towards environmental responsibility can make a difference.

Source: Wyndham Hotels & Resorts

Some travel brands may find it easier than others to be more eco-friendly. For instance, you might want to reduce plastic use, use more sustainable materials, or contribute to a nonprofit organization focusing on environmental causes.

Or you can encourage your followers to make better environmentally-conscious decisions that will help to reduce carbon footprints.

Tourism Marketing Trends in 2023: Key Takeaways

• Tourism has faced recent challenges but is still expected to grow as weary consumers seek to escape it all.
• Domestic travel at the personal level has begun to surpass pre-pandemic levels, but domestic business and international travel will grow slower in 2023.
• For your brand to succeed in 2023, you must leverage the latest travel marketing trends.
• Understanding the latest digital marketing trends in tourism and carrying out a successful, strategic digital marketing campaign utilizing those travel industry trends are two different things. Some businesses prefer to hire a professional digital marketing agency to execute those strategies.

How Hearst Bay Area Can Help

Marketing for travel and tourism brands sometimes requires a more refined approach to win over consumers.

We've helped many travel brands leverage the best marketing strategies to get winning results utilizing personalized approaches that deliver the best customer experiences to your targets.

Our scope has also reached beyond the local area as we've helped many travel and hospitality companies at the domestic and international levels.

Contact Hearst Bay Area today to get started with the latest tourism trends to put your brand forward.

To read the Top Travel Trends for 2024, click here .

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25 Hotel Industry Statistics [2023]: Hotel Rate Trends And Market Data

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Research Summary. The hotel industry not only reaches across the globe but also spans a wide cross-section of options ranging from budget motels to luxury resorts, making it an interesting field to study. Here are the key statistics on the hotel industry:

There are at least 187,000 hotels in the world as of 2023.

There are an estimated 17.5 million guestrooms in the world.

The global hospitality industry is worth over $4.548 trillion as of 2022.

There are about 1.6 million people employed by the U.S.’s accommodation industry.

The global travel and tourism industry was worth $4.671 trillion in 2020 , down from its $9.17 trillion value in 2019.

The average U.S. hotel occupancy rate is 64.2% as of February 2023.

Hotel Industry Statistics by Consumer Preferences

78% of millennials would rather spend their money on experiences than on things.

Hotels with a significant number of high-quality photos on their websites see a 15% increase in conversion rates.

This is compared to hotels that use few and/or low-quality photos. Including good photos of hotel rooms and amenities helps travelers know what they’re getting into and better imagine themselves there.

TripAdvisor shared that the number of photos a hotel has on its TripAdvisor profile has the most impact on traveler engagement with the listing.

More specifically, properties with at least one photo see a 138% increase in engagement and are 225% more likely to receive a booking inquiry, and those with over 100 photos see a 151% increase in engagement and are 283% more likely to receive a booking inquiry.

Europe has the highest hotel occupancy rate of any region in the world.

As of 2019, European hotels have an occupancy rate of 72.2%, meaning an average of 72.2% of all hotel rooms are occupied.

US Hotel Industry Statistics

There are 90,562 hotel and motel businesses in the U.S.

This number is a 0.4% increase from 2021, which is on trend with the average annual growth rate of 0.4% that this industry has seen from 2017 to 2022.

There are approximately 5.29 million hotel rooms in the U.S.

The U.S. hotel and motel industry is worth $177.6 billion.

This industry is predicted to grow by 33.6% throughout 2022 as it continues to recover from the COVID-19 pandemic, although it’s seen an average annual decline of 2.4% from 2017 to 2022.

The U.S. tourism industry was valued at $545.11 billion in 2020.

In 2020, U.S. hotels had an average occupancy rate of 44%.

Hotel Industry Statistics by Employment

The U.S.’s accommodation industry employs about 1.6 million people.

In Q1 2019, there were 1.352 million gross job gains in the U.S. leisure and hospitality sector.

Here are data points for each quarter from Q1 2019 through Q2 2021.

In Q1 of 2019, there were 1.22 million gross job losses in the U.S. leisure and hospitality industry.

Here are the numbers for each quarter following that through Q2 2021:

The average employee of the U.S. leisure and hospitality industry makes $19.44 an hour.

32% of U.S. leisure and hospitality industry employees have access to employer-sponsored health care.

43% get paid vacation from their employers, and 50% receive paid sick leave .

Hotel Industry Trends and Projections

In 2019, the global hotels and resorts market was worth over $1.5 trillion.

This was just before the COVID-19 pandemic caused widespread lockdowns in 2020, and it was the pinnacle of seven years of nearly continuous growth.

From 2021 to 2025, the global hotel and travel accommodation industry is projected to have a CAGR of 7%.

This will result in a market value of $1.05 trillion in 2025. In 2020, the global hotel and travel accommodation market was worth $673.02 billion, and it grew to $801.9 billion in 2021, which is a CAGR of 19.1%.

In 2020, travel and tourism contributed $4.671 trillion to the global GDP.

While this is a significant amount of money, it is also a significant decrease from the $9.17 trillion it contributed in 2019. This is a result of the 2020 COVID-19 lockdowns that significantly reduced the amount of travel in the world.

From 2008 to 2018, the number of hotels around the world has increased by nearly 14,300.

Hotel Industry Statistics FAQ

What is the growth rate of the hotel industry?

The growth rate of the hotel industry is 19.1%. This was the CAGR from 2020 to 2021 as the global hotel industry reopened after the COVID-19 pandemic lockdowns began to lift.

What are the four segments of the hospitality industry?

The four segments of the hospitality industry are Food and Beverage, Accommodation (also referred to as Lodging), Travel and Tourism, and Entertainment and Recreation.

You don’t necessarily have to be traveling to enjoy the hospitality industry’s offerings. The Food and Beverage sector, for example, includes restaurants , bowling alley food, and concessions stands, not just hotel restaurants. As a result, this is the largest sector of the hospitality industry.

The Accommodation or Lodging sector includes hotels, campgrounds, rental homes, and any other facility that gives people a place to sleep. This includes resorts, motels, and hostels all alike.

The Travel and Tourism sector covers the actual act of traveling via airlines, cruise ships, trains, taxis, and more. Whether you’re traveling for leisure or business, chances are you’ll utilize at least one of travel and tourism’s offerings on a trip.

The last sector of the hospitality industry is Entertainment and Recreation. This sector is made up of all the activities that people do just for the enjoyment of it. These include:

Swimming pools

Spectator sports

Movie theaters

Participatory sports (e.g., scuba diving, golf, tennis)

Amusement parks

How many American hospitality workers were fired or laid off in 2020?

10.65 million American hospitality workers were fired or laid off in 2020. While About 1.2 to 1.4 million people in this industry lost their jobs each quarter throughout 2019, 1.695 found themselves unemployed in Q1 2020, and a whopping 6.331 million were suddenly unemployed in Q2 2020 due to the COVID-19 pandemic lockdowns.

Is the hotel industry recovering?

Yes, the hotel industry is recovering. The global hotel and travel accommodation industry is expected to have a CAGR of 7% from 2021 to 2025.

What are the latest trends in the hotel industry?

The latest trends in the hotel industry are high-tech, green facilities, alternative accommodation options, and incorporating experiences into hotel stays.

Hotels are beginning to implement more and more smart technology, whether it’s a keyless entry or turning on the AC with an app. In addition, many hotels are looking for ways to reduce their carbon footprint by conserving water, reducing single-use plastics, and earning their LEED certifications.

Another hotel industry trend is that travelers (especially millennials) are looking more toward alternative accommodation options, whether that’s a rental house or villa, a mobile home, or hotels with a personality that reflect the local culture rather than standardized branding.

Hotels are responding to this by focusing on opening boutique hotels and facilities that bring unique elements to their decor, amenities, and even floor plans.

The hotel industry is a major player in the global and U.S. economies. In 2022, the global hotel industry was worth more than $4.548 trillion and is projected to see a CAGR of 7% from 2021 to 2025. In the U.S. alone, the hotel and motel industry is worth $177.6 billion, and the tourism industry is worth $545.11 billion.

Lockdowns in response to the COVID-19 pandemic in 2020 significantly impacted this industry. The worldwide travel and tourism industry contributed $4.671 trillion to the global GDP in 2020, which is just over half the amount it contributed in 2019 ($9.17 trillion).

In the U.S., over seven million leisure and hospitality industry employees lost their jobs during the first six months of 2020, compared to the just over five million that found themselves unemployed throughout all of 2019. Hotel occupancy rates also dropped by 33.3% from 2019 to 2020.

Eventbrite. “ Millennials: Fueling the Experience Economy. ” Accessed on February 16, 2022.

Medium . “ The Importance of Imagery on Hotel Websites. ” Accessed on February 16, 2022.

Frederic Gonzalo. “ Photos Impact Bookings More Than Reviews. ” Accessed on February 16, 2022.

Statista. “ Occupancy Rate of the Hotel Industry Worldwide From 2008 to 2019, by Region. ” Accessed on February 16, 2022.

IBISWorld. “ Hotels & Motels in the U.S. – Number of Businesses 2005-2027. ” Accessed on February 16, 2022.

Statista. “ Number of Hotel Rooms in the United States From 2017 to 2020, by Chain Scale Segment. ” Accessed on February 16, 2022.

IBISWorld. “ Hotels & Motels in the U.S. – Market Size 2005-2027. ” Accessed on February 16, 2022.

Statista. “ Market Size of the Tourism Sector in the United States From 2011 to 2020, with a Forecast for 2021. ” Accessed on February 16, 2022.

Statista. “ Occupancy Rate of Hotel Industry in the United States From 2001 to 2020. ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Accommodation: NAICS 721. ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Economic News Release: Employment Situation Summary. ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Databases, Tables & Calculators by Subject: Gross Job Gains for the Leisure and Hospitality Sector in the U.S. (Rounded to the Nearest Thousands.) ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Databases, Tables & Calculators by Subject: Gross Job Losses for the Leisure and Hospitality Sector in the U.S. (Rounded to the Nearest Thousands). ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Leisure and Hospitality. ” Accessed on February 16, 2022.

IBISWorld. “ Global Hotels & Resorts – Market Size 2005-2027. ” Accessed on February 16, 2022.

Globe Newswire. “ Global Hotel and Other Travel Accommodation Market Report 2021: Market is Expected to Grow From $673.02 Billion in 2020 to $801.9 Billion in 2021 – Long-term Forecast to 2025 & 2030. ” Accessed on February 16, 2022.

Statista. “ Total Contribution of Travel and Tourism to Gross Domestic Product (GDP) Worldwide From 2006 to 2020. ” Accessed on February 16, 2022.

Statista. “ Total Number of Hotels Worldwide From 2008 to 2018. ” Accessed on February 16, 2022.

Hospitality Net. “ What Are the 4 Segments of the Hospitality Industry. ” Accessed on February 16, 2022.

Hotel Tech Report. “ 100 Hotel Trends You Need To Watch in 2022 & Beyond. ” Accessed on February 16, 2022.

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Abby is a writer who is passionate about the power of story. Whether it’s communicating complicated topics in a clear way or helping readers connect with another person or place from the comfort of their couch. Abby attended Oral Roberts University in Tulsa, Oklahoma, where she earned a degree in writing with concentrations in journalism and business.

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Looking Ahead: A 2024 Hospitality Market Forecast 

Category: Reports

Nov 29, 2023

The U.S.commercial real estate hospitality market, having successfully rebounded from the disruptions caused by the COVID-19 pandemic, including the suspension of travel and hotel reservations, has seen a robust recovery in its fundamentals. Although the industry was not without its challenges in 2023, including workforce shortages, increased wage rates, interest rate hikes, and reduced deal flow, there are positive indications of growth and potential investment opportunities in 2024.

Travel & Industry Updates 

Tourism rates have surged alongside restrictions on short-term rentals and a tightening supply of hotel rooms, leading to increased rates in major urban centers within the top 25 U.S. markets. Despite being severely impacted during the pandemic, these major cities are poised for a significant resurgence. The swift rebound can be attributed to the substantial pent-up demand for both business and leisure travel. A complete travel recovery isn’t anticipated until 2025, as escalating costs have hindered plans.

Business travel 

According to Deloitte, corporate bookings remain lower than 2019 levels, and if companies decide to cut costs due to 2024’s economic outlook, travel demand might face hurdles. Business travel is also lagging compared to pre-pandemic, as the increase in remote work has reduced travel frequency, with fewer employees needing to attend trips. Spend volume for corporate travel appears likely to recover by late 2024 or early 2025.

On a positive note, hotels are seeing a recovery in group travel as conferences and tradeshows are experiencing strong attendance. Further, companies have started arranging smaller corporate meetings to enhance team dynamics, indicating the enduring desire across industries to reconnect in person despite economic headwinds.

Leisure travel 

Leisure travel experienced a downturn in Q2 and Q3 2023; pandemic savings diminished, and increasing costs affected travel budgets. Despite this, there is an ongoing trend in “Bleisure Travel,” where business travelers extend their trips to enjoy leisure activities. Employees are structuring their travel plans around work and leisure, contributing to the industry’s recovery.

How the CRE Market is Adjusting 

Despite slower transaction activity, experts remain optimistic about the industry’s performance even in the face of a potential mild recession. This confidence is attributed to the sector’s ability to adapt and perform strongly. 

One significant challenge in the market is aligning buyers, sellers, and lenders on pricing expectations. Prospective sellers, having purchased assets at high valuations, are faced with minimizing losses by selling at the best possible price or holding onto assets, hoping to recover asset values. 

At the same time, buyers face elevated borrowing costs and seek lower pricing on acquisitions to achieve healthy returns. This dynamic has widened bid-ask spreads across various real estate asset classes, leading to retraded or terminated deals during due diligence. 

Distressed scenarios are also emerging as borrowers under non-recourse loans default, adding further complexity to the market. In response, savvy investors are capitalizing on market opportunities. The most sought-after deals involve economy and limited-service hotels in markets such as Atlanta, California, Chicago, Charlotte, Florida, New York, Phoenix, and Texas. 

A look at the fundamentals 

Over the last 12 months, the average daily rate (ADR) and revenue per available room (RevPAR) are 7.5 and 10.3 percent higher than a year ago, a significant indicator that the hospitality sector is recovering. RevPAR growth is predicted to slow to 0 to 2 percent in 2024 due to decreased U.S. economic growth and leisure travel. However, business travel is expected to keep occupancy rates and ADR stable.

New supply is not expected to be a severe headwind to the sector’s fundamentals and has only grown sub-0.5% for a while now. There are 153,509 rooms under construction, but the rising cost of construction debt will likely impact construction counts. However, an estimated 94,500 hotel rooms are slated for delivery across the U.S. by the end of this year, a 37.6% increase from 2022. To note, this number is lower than the 2016 to 2021 levels, and annual room deliveries still trail the long-term U.S. average by 2.4 percent.

 Historically, there has been a strong correlation between GDP and RevPAR from 1990-2019. This 30-year trend is expected to diverge in 2023. Title of this graph – GDP vs. RevPAR. 

On-market data (produced in collaboration with Crexi)  

As higher interest rates keep deal underwriting difficult and the bid-ask spread continues to be elevated, transaction activity has been muted in 2023. The data below indicates that despite headwinds, the hospitality sector remained relatively stable and free from volatility during the COVID-19 pandemic.

The Bottom Line

In conclusion, the hospitality market has effectively recovered from the disruptions caused by the COVID-19 pandemic despite grappling with the challenges presented in 2023. The upswing in ADR contributed to a sustained increase in RevPAR, bolstering overall gross revenues. Looking ahead, the growth of RevPAR is anticipated to decelerate in 2024, coinciding with the slowdown in U.S. economic expansion and a moderation in post-pandemic leisure travel. Nevertheless, for CRE investors prospecting individual hospitality assets, a transaction’s success will be contingent on factors such as operating fundamentals, capitalization, and market alignment. 

Find your next hospitality investment on Crexi.

Matthews Real Estate Investment Services ™, a commercial real estate investment services and technology firm, holds recognition as an industry leader in investment sales, leasing, and debt and structured finance. Matthews™ delivers superior results through the firm’s industry revered work ethic, unique culture, collaboration, and advanced technology.

Since 2015, Matthews™ has experienced unprecedented growth adding over 600 real estate professionals to serve clients. Founded in El Segundo, CA, and strategically positioned in 19 offices across the United States, Matthews™ continues to expand into new markets.

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Hospitality industry looks strong for 2023 – despite recession fears

EY Americas Real Estate, Hospitality & Construction Consulting Leader

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Despite economic headwinds stoking fears of a 2023 recession, the hospitality industry still defies expectations and posts strong numbers..

• Travel demand, while currently robust, may be impacted if companies need to cut costs in the face of a worsening economic outlook.
• The industry should continue to focus on efficiencies at the hotel and corporate levels, prioritizing customer experience, analytics and automation.
• Transaction activity is likely to be slower; due diligence is critical so teams are prepared when the right deal comes along.

T here is one cautionary note that is always important to keep in mind when evaluating the hospitality industry. Market performance of hospitality has exceeded other industries such as technology and retail, with the gap widening in the second half of the year.¹ Add the fact that revenue per available room (RevPAR) has exceeded GDP growth during the current economic cycle, and 2023 should be a good year for the hospitality sector (see graphic).

• As per a CBRE study, during the 2009 recession, 10.2% of the properties that experienced a decline in RevPAR saw their rooms revenue drop by more than 30%. On average, these properties also suffered a 35.3% drop in total revenue, but the decline in Gross operating profit averaged 57.0%.
• As per a CBRE study, in 2001, properties that experienced a decline in RevPAR, only 2% saw RevPAR fall by more than 30%. On average, these properties suffered a 35.3% drop in total revenue which resulted in a 54.2% decline in Gross operating profit.
• The impact of Covid-19 ended the nine-year trend of profit growth and positive RevPAR for U.S. hotels since 2010, with a significant upwards spike of RevPAR starting in 2020.

How EY can help

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“Historically there has been a strong correlation between GDP growth and RevPAR,” said Umar Riaz, EY Americas Hospitality Sector Leader, in a recent interview with HOTELS Magazine. “But it’s my opinion that given the current dynamics of the travel industry, even if there is a mild recession in the next six months or so, the travel industry will still perform strongly.”

The post-pandemic urge to travel remains strong, which should drive continued growth in 2023. In the US, RevPAR was up 8.1% in 2022 from 2019, and Europe was up 6.1% for the same period. Asia, driven primarily by China, was the weak spot with a 31.2% RevPAR decline from 2019 to 2022. The industry’s average daily rate (ADR), which measures the average rental revenue earned by an occupied room per day, was up 13.6% last year in the US and 18.5% in Europe, when compared with 2019 figures.²

Business travel is also poised for recovery as companies ramp up their travel budgets. Trade shows and conferences are selling out, reflecting the pent-up demand that persists across all industries to get out of the office. Another factor in the industry’s resurgence is the growing work-from-home (WFH) segment of the workforce. In some cases, those employees build their travel plans around both business and leisure. Bleisure travel, where business travelers add on a day or budget extra time in their work trip for sightseeing or some other type of leisure activity, is a growing trend. The result of these market developments is more revenue and continued economic recovery for the hospitality sector.

Reasons for optimism in hospitality sector

The EY organization projects that the global economic picture is mixed heading into 2023, depending on the region, but the long-simmering slowdown will likely turn into a global recession. In the US, the economy is visibly cooling because of persistent inflation, rising borrowing costs, deteriorating private sector morale and rapidly slowing global economic activity. Elevated inflation and a lingering energy crisis will lead to a moderate recession in the Eurozone. In China, the economic outlook remains uncertain, with growth constrained by the recently lifted zero-COVID-19 policy, a lingering property sector downturn and weakening global trade activity.

However, several factors contribute to optimism for the hospitality sector in 2023:

• Leisure demand, group business travel poised to remain strong: Consumer surveys show that most people are planning at least one leisure trip over the next six months. Rising inflation might mean that consumers will make different choices when they travel, but demand still remains strong. As for group business travel, key statistics, such as a convention center booking increase of 13% in 2023 relative to 2022, point to a strong year for group travel.³ According to a survey conducted by American Express, 65% of respondents expect their spend on meetings and events to increase in 2023.⁴
• Business travel recovery: According to a recent survey by Morgan Stanley of global corporate travel managers, travel budgets are likely to be 98% of 2019 levels, with nearly half the respondents expecting an increase of budgets relative to 2019.⁵
• China’s re-opening: Before the pandemic, China was the world’s largest outbound travel market, with Chinese travelers taking 154 million trips and spending $255 billion.⁶ With the lifting of COVID-19 travel restrictions, Chinese travelers will begin to travel again in 2023. While there are still significant airline capacity constraints, there will be a measurable impact on both the domestic and international hospitality industries.
• The rise of the digital nomad:  According to a recent EY survey of companies , 87% said that COVID-19 has had a profound effect on the workplace, with 72% saying that they now have a hybrid remote/office approach and 75% saying that they anticipate no central office in the foreseeable future. As these workplace trends take hold and people become untethered to their offices, these digital nomads will become even more mobile and will work from places where they want to travel.
• Infrastructure Investment and Jobs Act: Spending associated with the Infrastructure Investment and Jobs Act (IIJA) that was passed in the US in 2022 should lead to additional spending on hotels.

Deals market could see a slowdown

One aspect of the hospitality sector that isn’t expected to be so strong in 2023 is the transaction market. 

With the Fed continuing to raise interest rates in an attempt to drive down inflation, the cost of borrowing money will continue to go up. As a result, transaction activity is likely to be slow in 2023. Deals will still get done, and there will be opportunities to create value and drive growth through M&A activity in the hospitality sector. Transaction due diligence will be even more critical to identifying the right transaction, given the market circumstances. In some cases, 2023 will be a good time to focus on organic growth. But teams still need to monitor what’s happening in the industry and be prepared should the right deal come along.

Boomerang workers?

During the pandemic, the hospitality industry lost much of its workforce as travel restrictions forced hotels to make severe staffing cuts. The industry’s unemployment rate leapt from 5.7% in February 2020 to 39.3% in April 2020, according to the U.S. Bureau of Labor Statistics (BLS).⁷ Many of these workers took jobs in the technology sector, which desperately needed to fill positions to keep up with sudden demand created by lifestyle changes that came about due to the pandemic.

Three years later, the world is adjusting again. While tech companies shed jobs in response to the state of the economy in 2023, the hospitality industry is now ready to hire in response to the expected increase in travel. One of the sectors that had the biggest job growth in December 2022 was travel and leisure. Hotels that have struggled to provide the same level of service and amenities they did prior to the pandemic may be able to fill some of these positions and get closer to full strength.

Bottom line: 2023 should be a good year for the travel and hospitality industry.

The hospitality industry has much to look forward to in 2023 as travel demand continues to grow faster than expected over the last few years. Consumer research reveals that leisure and group business travel remains strong and new workplace trends allow people to travel more as they can work from anywhere. While the transaction market slows down, there is still opportunity to find a good deal while still focusing on organic growth.

About this article

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