Hotel trends 2023: Five factors that will shape the hospitality industry this year

2023-01-04

The past two years have been a time of upheaval and uncertainty in the travel and hospitality industries. From the impact of a global pandemic to an unprecedented labor shortage in the hospitality sector, it has been a bumpy ride for hotel operators. 

The good news is that, thanks to pent-up demand for travel during the pandemic, hospitality is in a period of recovery. The U.S. Travel Association notes that hotel demand is back at 2019 levels and that Average Daily Rates (ADR) were 17% above 2019 levels in October of 2022. 

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Industry trends to watch

According to the latest American Travel Sentiment Study from Longwoods International, 91% of travelers are planning trips in the next six months. The percentage of travelers who are changing their travel plans because of COVID-19 has dropped to 33%, the lowest level since the start of the pandemic in early 2020. 

A number of travel trends have shaped the direction of the hotel industry during this time, and these are likely to continue into 2023 and beyond. Here are five hospitality trends to watch: 

1. Smart energy consumption 

In December, the hospitality-industry magazine Hotels noted that energy prices had fallen marginally from their peak in the third quarter of 2022, but noted that they are still more than 20% higher than they had been at the same point in the previous year. 

Faced with soaring power prices and ongoing market instability, more and more operators in the hotel industry are looking for new technologies — including the following — to reduce their energy expenditure: 

  • Automation: smart devices can help minimize the unnecessary use of electricity, heating and cooling. This technology is part of an emerging trend called Energy as a Service, or EaaS. 

  • Renewable energy generators: operators of larger properties might consider employing solar, wind, or micro-hydro plants to ensure a long-term supply of relatively cheap energy. These can be expensive to install and maintain, but hotels in many places may be eligible for government subsidies or low-cost green loans to invest in renewable-energy technology. 

  • Air-source heat pumps: UNESCO recommends using pumps to transfer heat between the interior and exterior of the hotel as needed. This type of system can make a hotel room warmer or cooler depending on guests’ needs while cutting down on HVAC energy consumption and costs. 

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2. Authentic local experiences 

A Booking.com survey found that 60% of respondents “want to have authentic experiences that are representative of the local culture” when they travel. This can begin with the hotel design, which can create a distinct identity and impart a sense of place by incorporating elements reflecting the local community. 

Millennial customers in particular place highly value authentic and unique experiences. They want to dine on locally sourced food and drink locally made beer and wine. Many are also looking to interact with local people and participate in activities that make them feel like locals themselves. 

Tourists interacting with locals

Making a positive impact

For hospitality companies, this is a chance to make a positive impact by supporting the local economy. As they establish themselves, hotel owners have the opportunity to partner with small businesses in the local community such as boutique stores, tour-guide services, and restaurants, and help ensure that they have continued income throughout the tourist season and beyond.  

3. Digital nomadism and “bleisure” 

Business travel is expected to make a major comeback in 2023, but the lines between traveling for work and doing so for the sheer enjoyment of it are becoming increasingly blurred.

Commonly known as “bleisure” (a portmanteau of “business” and “leisure”), this hybrid approach to work trips has also been dubbed “mullet travel” by Wall Street Journal reporter Jacob Passy. It’s a humorous name, but it makes sense; just as the mullet hairstyle can be described as “business in the front, party at the back”, a bleisure trip is often front-loaded with work, with a bit of time for fun at the back end. 

man working on the beach

Make remote workers feel welcome

Another trend to watch is the rise of the “digital nomad” class. According to the Oxford English Dictionary, which added the term back in 1993, a digital nomad is “a person who earns a living working online in various locations of their choosing (rather than a fixed business location).”

This was already a growing movement pre-pandemic. With the rapid adoption of remote work in the COVID era (and the technology that makes it possible), it became apparent that if they could work from home, they could do so from anywhere — including a hotel room. 

Hotels can make working travelers — whether they’re checking in for a weekend or staying for a month — feel welcome by providing them with work-friendly desks in their rooms, free WiFi, co-working spaces, and of course, coffee. Lots and lots of coffee. 

4. Wellness tourism 

The Global Wellness Institute (GWI) defines wellness tourism as “travel associated with the pursuit of maintaining or enhancing one’s personal wellbeing.” This should not be confused with “medical tourism”, in which someone might, for example, travel to a different country to receive surgery or other treatment because it is more affordable, higher quality or unavailable at home.  

The GWI says wellness encompasses “the proactive things we do to maintain a healthy lifestyle, reduce stress, prevent disease, and enhance our wellbeing.”  

Wellness is a big business

In 2019, wellness tourism reached a record $720 billion before taking a dip the following year thanks to the pandemic. However, the GWI forecasts that the wellness tourism industry will reach $1.3 trillion by 2025.  

Couple doing yoga at a health spa

To take advantage of this trend, hotel owners should consider offering their customers yoga classes, massages and healthy breakfast options. Wellness travelers have deep pockets, spending 177% more than an average guest when traveling domestically, and 35% more when traveling internationally. 

5. Sustainability 

In 2023, expect to see more hospitality operators move toward more sustainable practices in response to increased guest demand. According to the Booking.com Sustainable Travel Report 2022, “78% of global travelers intend to stay in a sustainable property at least once in the coming year.” 

Moreover, many travelers are willing to pay more for the opportunity to support more eco-friendly businesses, according to research from Expedia + Skift: “Half of consumers would be willing to pay more for transportation, activities, and lodging if the option was more sustainable.…On average, consumers are willing to pay 38% more to make their travels more sustainable.” 

Engaging with hotel guests

Hospitality Net reports that “3 out of 4 accommodation providers say they have implemented at least some kind of sustainability practices at their property, but only one-third actively communicate about their efforts proactively to potential guests.” 

Hotels should consider adding a sustainability or corporate-responsibility page to their website in addition to engaging with past, present and potential future clients through social media and email marketing. 

As we noted in a recent blog post, getting your property eco-certified can give you a definite edge when it comes to search engine optimization. As part of the ongoing development of Google Search, the company built a feature that helps prospective guests differentiate hotels and resorts that are eco-friendly. Now, when people look for hotels on their desktop computers or mobile devices, the search engine can show them whether or not they are eco-certified.  

Get the word out with Self-Pub

Hotels that offer PressReader can let their current guests know about their eco-friendly initiatives by using the Self-Pub feature. PressReader features more than 7,000 newspapers and magazines from around the world, but it is more than just a way to give guests access to third-party content.  

With PressReader’s Self-Pub technology, hotels can also share their own content in a paperless and contact-free way, including hotel directories, restaurant and room-service menus, and details of the property’s sustainability efforts. 

PressReader is working with hotel leaders around the world to improve the guest experience. Learn more about how we’re partnering with members of the hospitality industry to help their properties stand out.

Let’s work together 

 

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