5 trends shaping the travel
landscape

After a sharp rebound in 2022, growth in leisure demand is expected to level off in 2023 but still remain strong, with higher demand in the business, group, and international travel segments picking up the slack. Growth in international travel will be driven in part by the Asia Pacific region, the last holdout for pandemic travel restrictions. The rapid rate of growth hotels enjoyed in 2022 is expected to level off in 2023. Concurrently, the International Monetary Fund predicts that inflation will also fall as well.

In 2023, we can expect a shift in demographics too, as Boomers begin to age out of travel and younger generations take their place. With their children now reaching adulthood, Gen Xers are ready to flaunt their newfound freedom. Meanwhile, Millennials are hitting peak earnings, and Gen Zs, who are far more tech-savvy and environmentally aware than previous generations, are beginning to flex their travel muscle. 

What all generations have in common is a strong urge to travel. According to Expedia, travel is more important than it was pre-pandemic for 46% of travelers and is even more so for Millennials (52%) and Gen Zs (50%). 

No matter what market segments your property targets, an increase in travel promises to benefit all accommodation suppliers. As the saying goes, a rising tide lifts all boats. However, be prepared for the tide to carry travelers with different expectations from previous years. The better you understand them, the better positioned you will be to satisfy their needs.

Here we explore five enduring hotel trends that should be on every hotelier’s radar.

Trend 1: Value-driven decision-making

We know travelers love upgrades, but what about downgrades? With the high costs of travel and economic uncertainty in the air, travelers will be more price-sensitive than usual in 2023. According to a Skift survey, 34 percent of Americans plan to cut down on their travel spending in 2023 because of high prices of travel products. For some people, this may involve taking shorter trips, traveling off-season or mid-week, or choosing a more affordable property or room type. 

Research from the biggest players in travel all points to a similar trend. Last August, Google observed that searches for hostels and budget hotels had grown by 300% globally from the previous year. “Consumers are shifting their priorities to get the best bang for their buck,” the search giant noted. However, Google cautioned that travelers “aren’t ready to give up on small luxuries just yet … They are looking for quality experiences at a good value.”

More recently, a survey from Expedia found that 35% of travelers are more concerned about value than ever before and 43% plan to stay in one to three-star hotels in 2023. Again, that doesn’t mean compromising comfort or the cool factor. Expedia anticipates a boom in bookings of three-star hotels that offer “excellent amenities, stylish interiors, and unique vibes as a standard.”

Make way for the bargain-hunters, says Booking.com. “2023 will see financially-savvy itinerary curation at its finest, with people planning travel budgets more tightly by taking advantage of deals, hacks and smartly-timed travel and prioritizing value for money with discounts and loyalty programs.” 

What does this mean for independent properties?

As we saw from our survey, inflation is also top of mind for independent lodging operators. In 2022, hotels were able to counter rising costs by increasing room rates. With price sensitivity higher this year, that tactic might only deter travelers from booking. 

However, dropping rates has never been a sound long-term growth strategy. So how best to satisfy travelers’ desire to find a deal? According to Expedia, the most appealing deals to travelers are complimentary add-ons and discounts for booking in advance, last-minute, a package, or a longer stay.

Use promotions to incentivize desired traveler behavior such as offering last-minute deals to fill unsold rooms, discounts for longer stays and packages, and non-refundable rates to deter cancellations. Consider offering value-adds such as upgrades, welcome amenities, free parking, or food & beverage credits. And throw in some of those “small luxuries” and “cool factors” travelers say they aren’t willing to sacrifice. 

Strive to maintain a dynamic pricing strategy, adjusting prices in response to changes in market demand, occupancy, and competitor behavior. The end goal is to boost bookings during slower times and boost rates during busier times. Use revenue management tools to help automate pricing alerts, rate shopping, and distribution activities.

Bear in mind that value doesn’t always mean cheap. Travelers of all types from budget to luxury expect lodging experiences to be worth the price. This means always upholding quality and never resorting to “skimpflation” tactics by reducing product quality or services to save costs. If you compromise on quality, you risk facing a negative backlash in online reviews and guest loyalty, and that can cause long-term damage to your brand. 

Trend 2: The front desk goes virtual

Traditionally, the front desk is the central hub of hotel operations, where guests check in, check out, and seek assistance throughout their stay. After the pandemic hit and demand for contactless services skyrocketed, travelers discovered there’s a better alternative: mobile check-in, along with a host of virtual services that allow them to bypass the line at the front desk. 

Granted, hotels are a little late to the party. At banks, airports, and supermarkets, consumers long ago discovered the speed and efficiency of self-serve automation. Increasingly, they expect similar options at hotels. 

And the timing couldn’t be better. The hospitality industry is in the midst of a long and protracted labor crisis, and it’s driving up wages and employee turnover, eating into profits, and frustrating hotel guests.

It’s no surprise, then, that more properties are turning to automation technology to reduce operating costs and lower dependency on an unpredictable labor market. This includes everything from mobile check-in and checkout to digital keys to guest messaging solutions, mobile concierge, chatbots, and several other hotel apps and new technologies to help hotel management meet the growing expectations of today’s guests. 

In this snippet from the 2023 State of Independent Lodging & Travel Trends webinar, Nuria Bernat, Director of Operations at Sweet Accommodations, explains how digital check-in is helping her properties increase efficiency and enhance guest experience.

Does this spell the beginning of the end for the front desk? Already at a growing number of short-term rentals, serviced apartments, and hotels, guests can manage their entire stay through a mobile app. For other properties, a hybrid model is emerging, where guests can choose between helping themselves or being served by hotel staff. 

What does this mean for independent properties?

In the food and accommodation industry, it now takes 5.5 weeks on average to fill job openings compared to two to three weeks in previous years, according to Skift. “This could indicate a permanent shift in the market,” Skift warns. “Hotels need to start rethinking how they staff positions like the front desk now.”

That doesn’t mean you must rip out your front desk tomorrow, but it does mean taking a serious look at front office operations and deciding where it makes sense to automate guest touchpoints and where you prefer to retain employee-delivered service. According to our survey results, guest messaging, keyless room entry, and a mobile app are among independent properties’ top tech investment priorities. Some properties may simply offer online check-in to cut down on wait times at the front desk. Others may redesign the lobby to provide communal spaces where guests can relax and serve themselves. 

Whichever path you choose, it’s essential to recognize that automation has raised the bar. Whether virtual or in person, travelers expect quicker, more efficient service from the front desk. Fortunately, hotel technology solutions have never been more accessible to independent properties. With an open, cloud-based hospitality platform, hotels can enhance speed and productivity at the front desk and seamlessly offer guests a range of virtual services. 

Judging from our survey results, it’s clear that independent properties understand the urgency of the situation and are taking action. Perhaps the biggest obstacle is hotel owners and operators who cling to old ways of doing business and assume their guests want the same. But there are ways to take advantage of automation and tech-based hotel trends without sacrificing the human touch. Hotel business owners and operators would be wise to figure out what this means for their property and start implementing a game plan.

Trend 3: Blended travel meets hybrid hospitality 

Last year, staycations and revenge travel were all the rage. This year, it’s all about blended travel. During the pandemic, the “work from home” trend exploded when offices were closed. Once travel restrictions were lifted, remote workers discovered that even better than working from home is working from an exotic locale or cosmopolitan city. Thus the “work from anywhere” craze was born. 

Today, remote workers are combining remote work with leisure travel on the same trip, a trend known as blended travel, “flexcations,” or “bleisure.” Or, as The Wall Street Journal quips, “mullet travel,” with business in the front and party in the back. Expedia’s Value Index 2023 survey found that 76% of business travelers plan to extend a work trip for leisure purposes in 2023 and 28% of travelers plan to take a flexcation.

The trend is transforming travel patterns. As we saw in our data analysis, in 2022, stays of 3 to 6 nights were up 8% over 2019 levels at independent properties. We also saw that extended weekend stays increased in popularity. STR reports that in some destinations shoulder days – Sundays and Thursdays – have recovered from the pandemic downturn almost as rapidly as weekends, while midweek days have lagged. As blended travel gains momentum, it is expected to extend peak seasons and boost occupancy in shoulder and lower seasons too.

The trend is driving higher demand for accommodations that provide both leisure and business facilities. This includes aparthotels and short-term rentals as well as newer hybrid lodging concepts like UK-based Selina, which offers co-living, co-working, recreation, and wellness spaces under the same roof. Other properties cater to value-driven travelers. The Pad in Silverthorne, Colorado combines the best of hotels and hostels, allowing guests to choose from a range of room types, from family suites to shared dorm rooms. And the ZERO Box Lodge in Portugal offers accommodation inspired by Japanese capsule hotels where guests stay in minimalistic wooden boxes equipped with a private bathroom in a shared dorm coupled with an onsite theater, art, and creative design.

Meanwhile, in what Skift calls “The Great Merging,” the lines are blurring between hotels and alternative accommodations. Travel sites like Expedia, Booking.com, and Kayak feature hotels and vacation rentals side-by-side in search results. Big hotel brands like Marriott and Accor are investing in vacation rentals and extended stay offerings. And more travelers are open to different types of accommodation depending on the nature of the trip. 

What does this mean for independent properties?

Trend 4: New tech disrupts travel search and inspiration

The ways people find travel inspiration are changing, and younger generations are leading the charge. While Google remains the world’s dominant search engine for travel, two technologies promise to disrupt this space: curated short-form video and conversational AI.

Video has been around for years, of course, but it’s getting shorter. Typically no more than a minute in length, short-form videos (SFVs) are the future of social travel marketing and are becoming a growing hotel marketing trend. Skift predicts that SFVs will represent “a cultural shift away from highly polished to more authentic content” that provides entertainment, connection, and discovery all in one place. 

The big disrupter in the short-form video space is TikTok, which has amassed an estimated 750 million users globally since launching in 2016. Today, it’s the world’s most downloaded app for people ages 18 to 24. Recently, TikTok content has expanded from viral dance videos to become a search engine for everything from finding a local restaurant to discovering a new travel destination. Users say that TikTok videos provide more relevant, personal, visual, and easily digestible information than the text-heavy, faceless websites delivered in Google search results.

Other platforms are taking notice. Google has begun featuring more videos in search results, and YouTube launched YouTube Shorts in 2020. On Facebook and Instagram, posts featuring Reels are given higher priority in user feeds, and the preferred positioning is paying off: watching videos occupies half of the time users spend on these platforms.

In recent months, the world has been abuzz about ChatGPT, a new AI-powered chatbot that can interact with humans in a natural language format. Though in its infancy as a consumer tool, Microsoft and Google are already in a race to integrate generative AI chat into their search engines, which could potentially change how we search for travel. Early adopters have already experimented with asking ChatGPT to design travel itineraries and make curated travel recommendations (to some degree of success), but industry experts say that it may be a while before these tools can become fully integrated into a typical travel booking process.

What does this mean for independent properties?

Trend 5: A shift from amenities to experiences

Traditionally, properties distinguish themselves in part by the amenities they provide. Amenities can act as a powerful draw for travelers and can make or break a hotel stay, according to research from Boston Hospitality Review. 

In the pre-Covid-19 years, the race to offer the latest and greatest amenities led to clutter in hotel rooms. In those days, upcoming trend predictions included initiatives like smart rooms, and virtual reality experiences. When the pandemic hit, amenities were removed as a safety measure. And while some have reappeared since then, today’s travelers are less interested in amenities and more interested in experiences. 

We’re not talking about duck tours and macrame classes. “Alternative getaways such as sylvotherapy (forest bathing), chakra sessions, food boot camps, puppy yoga, laughter therapy, and fruit harvesting are increasingly more popular than classics such as cookery courses, sports trips, and meditation sessions,” Expedia reports. Then again, a separate Expedia survey found that 96% of vacationers want to spend at least a portion of their trip doing nothing at all. 

Booking.com is observing a similar trend toward experience-driven travel. Travelers want unique vacations that shock, surprise, and delight, the OTA reports, with 50% seeking complete culture shock and 73% seeking out-of-comfort zone travel that pushes them to the limits. 

One of the biggest travel trends arising from the pandemic is a higher consciousness of the impact of travel on the well-being of the environment. According to Expedia, 90% of consumers now look for sustainable options when traveling and half are willing to pay more for transportation, activities, and lodging if the option is more sustainable. 

Demand for travel experiences is changing how some travel sites market accommodations. Airbnb’s new “Categories” feature allows users to select from 55 search filters ranging from yurts and tiny homes to mansions and castles in addition to themes like play, golfing, and creative spaces. Expedia has added “Traveler Experience” filters that include LGBTQ-welcoming, business-friendly, and family-friendly options. And Booking.com allows users to filter accommodation searches by sustainability practices. 

To meet the demand, big hotel brands are touting more locally sourced products, implementing more environmentally friendly practices, and partnering with local businesses to offer unique experiences. On Accor’s website, travelers can select from activities ranging from opera tickets in Rome to capoeira classes in Rio de Janeiro.

What does this mean for independent properties?

Conclusion: It’s time to flaunt your independence

Come what may in 2023, this is the year to ride the wave of renewed optimism toward travel. While we all wish we had a crystal ball, there are still ways to anticipate traveler behavior and ensure you’re well prepared. In addition to monitoring the latest travel news, data, and hospitality industry trends, hoteliers must listen carefully to guest feedback and scrutinize guest data and insights from the property management system (PMS), channel manager, and other core software systems.

Then it’s a matter of ensuring you have the resources in place to ride the wave. First and foremost, keep your team members happy and loyal. Second, implement the technology you need to exceed guest expectations and create the upskilling opportunities employees need to evolve as technology plays a greater role in operations. Third, flaunt your independence by providing the authentic, meaningful customer experiences that travelers seek today and that only your property can offer.

The more proactively you take on these challenges, the better positioned you will be to earn more reservations and happier guests in 2023 and beyond.