The hotel industry is going through a period of unprecedented, irreversible change and will look very different in 2020 than it does today. We shed light on some of the biggest questions facing the sector – how will hotels attract the business and leisure guests of tomorrow? How can they compete in a digital world? And what will their future business models look like?
On the surface, a casual observer might think that the sector is in good shape. By 2016, total hotel revenues are expected to exceed half a trillion US dollars1. Occupancy, RevPAR and average daily rates are all high, making for a good outlook.
Yet strong trading figures are only part of the picture. Hotels are feeling the impact of a much deeper trend. The industry is increasingly consumer-led and guests are calling the shots. As in other sectors, digital technologies are shifting the balance of power towards the consumer.
At the same time, consumers are changing. Over the next few years, we will see ‘millennials’ – digital natives who bring a strong desire for local, ‘authentic’ experiences – becoming the primary consumer market2. International guests, especially from emerging markets, are also growing in importance. In the UK, foreign guests are expected to drive nearly all hotel growth
between now and 2020. For hotels, this means travellers increasingly demanding services (and languages) tailored to their needs.
With these trends making a growing impact on hotel operators worldwide, Grant Thornton examines how the consumer-led economy will change the playing field for hoteliers between now and 2020. We explore the principal challenges and opportunities for hotels across four key themes, drawing out the foremost questions that hotels should be asking as they prepare their businesses for the future.