2023 hotel and travel trends

2023 hotel and travel trends

[Credit: Freepik]

BHN editor Eloise Hanson outlines six hotel and travel trends expected to shape the industry in 2023.

Hotel e-tail

With inflation on the rise globally, consumers are likely to be more mindful when it comes to spending their money. Pent-up demand and revenge travel have helped major cities recover post-Covid, resulting in strong and resilient ADRs. In fact, research from HVS shows that over the past 50 years, daily rates across London hotels have grown 0.75 per cent on average above inflation per year. This means that during periods of high consumer price growth, hotels have been able to raise room rates and pass on these rising costs to guests.

Whilst the desire to travel is strong, spending habits could be influenced by inflation concerns, leading to increased time spent researching.

Platforms such as Facebook, Instagram and TikTok have rolled out eCommerce strategies including live shopping, product tags and links, to make the shopping experience simple and convenient. TikTok – where 45 per cent of users want to see more hotel related content – is reportedly chasing Amazon with plans to build eCommerce distribution centres in the US. Some day, users might be able to book a hotel stay directly through the platform as well as buy hotel related items advertised in video content.

In the meantime, a dedicated eCommerce platform for hotels and resorts, LiBi, launched earlier this year. Through corresponding QR code access, guests can scan and purchase items found on-property to be delivered to their personal home address. Co-founder Suzanne Mahoney explains: “Opportunities to experience physical products are shrinking as shopping moves online – but the hospitality industry offers huge potential for brands to tell their stories and reach their consumers… It’s the ultimate ‘try before you buy’ model”.

Marc Saunders, director of marketing at Splendid Hospitality, also believes there is opportunity to drive revenue by activating hotel spaces with retail partnerships. “Consumers with less disposable income will demand more for less and this will gather pace particularly with regards to the experience trend within hospitality. As a result, hotels will maximise partnerships with retailers and become more multifaceted in their approach,” he says.

A recent Knight Frank report supports this idea, revealing that ancillary revenues have increased in 2022 with the contribution to total revenue rising by 1.5 percentage points. “The uplift in revenue generated from the rental of space and concessions has been the over-riding contributing factor to this growth,” writes Philippa Goldstein, senior analyst of hotels and leisure.

Deploying the right technology is integral for a robust eCommerce strategy. As Simon Bullingham, CEO of Journey Hospitality highlights, consideration must be given to open-API booking engines, AI-powered promotional messaging, and shoppable content via VR and 360 tours. In Bullingham’s words, hotels need to be more like Selfridges. “The last two years proved that by seizing the opportunity to broaden and differentiate offerings, hotels can reap commercial benefits – and those learnings can be implemented through retailing technology,” he says. “Hoteliers can tap into wider societal trends and innovation, extend hospitality’s service culture into the digital realm, and bolster revenue by driving sales across all aspects of a hotel’s products and services.”

CRM spotlight

2022 marked the year in which most web browsers restricted the use of third-party cookies. Ironically it comes at a time when the demand for personalised experiences is also on the rise. This places huge emphasis on first-party user data – collected for example from direct bookings and loyalty programs – meaning that hoteliers and their teams will lean more heavily on the infrastructure in place to store data, analyse customer profiles and market relevant offers.

“Every interaction is an opportunity to sell in a smart way,” says Adir Ron, chief marketing officer at Duve. “Once a hotelier is able to deliver a strong personal experience that relates and connects with a guest, it creates an exceptional impression. It increases a guest’s return rate whilst also increasing the chance of guests’ booking directly. And it also increases the chance of positive reviews, which helps to generate additional incoming traffic. Furthermore, if this can be executed with smart tools, the above can be achieved with fewer staff.”

Investing in a customer relationship strategy will help to boost satisfaction, improve engagement, drive loyalty and ultimately increase brand value. Hoteliers should use their time wisely to prepare for a cookieless world by identifying the right technology partners to inform data-driven marketing. 

AI-enabled chatbots and digital concierges serve as the first point of contact for some customers. Programmed to answer frequently asked questions, chatbots can also collect enquiries from potential and in-house guests. Over time, this provides hoteliers with enough information to understand customer behaviour trends as well as operational and sales opportunities. The AI capabilities of digital communication services also means that the technology is continuously learning about the changing needs of guests, enabling the industry to adapt accordingly. HiJiffy’s AI system Aplysia is the product of six years of training and can escalate conversations to relevant departments based on syntax and semantic analysis as well as emotional understanding. 

Payments will also form a major part of a hotelier’s CRM strategy moving forwards, especially taking into account the shift to eCommerce. Apple Wallet has revolutionised payments, making the process quick and convenient for users. But travel and hospitality has been slow to adopt this feature, resulting in a pain point for travellers and negatively impacting the guest experience. 

As David Molofsky, product manager at IRIS Software Systems, highlights: “Both guests and operators have been reassured by the functionality of F&B mobile ordering and this level of confidence will no doubt trigger strong growth in the domains of both guest directory and service requests going forward. Not only do guests actively want to manage this part of their stay themselves, it also shifts the burden from members of staff who can be available to offer advice. When it comes to researching and actually confirming a booking, reassuringly guests are more willing to do so online, at a time and location that suits them and their itinerary.”

Hotel management systems will therefore look to add new integrations, predominantly customer facing, to enhance and streamline the guest journey pre, during and post trip. Branigan Mulcahy, the co-founder of digital concierge Virdee which has partnered with operations platform Cloudbeds, predicts: “Expect to see a renewed industry focus on winning customers through guest experience, with technology providing a seamless journey and staff focusing on delivering additional delight to guests. Technology adoption in 2023 will set innovative hoteliers apart from the competition.”

Digital twins

A digital twin is a digital representation or replica of an object or a system and is typically powered by VR (virtual reality). Similar technology is already being used by platforms such as Cvent, which provides 3D programming tools for planners to design events in real time. Advances like this help to save time and amplify brand presence, serving to differentiate hotels against competitors. When real life events are initially being created as a digital twin, it was only a matter of time before entire hotels took to the virtual stage. 

But before we step in to the metaverse, it’s worth noting that architects and designers rely on digital renderings and computer-generated imagery (CGI) to visualise projects. Arguably, it’s owing to these skills that AMANO Hotel Group was able to develop its first international outpost in the UK over Zoom. Albeit a result of circumstance than one of choice, the pandemic has largely accelerated our use of technology. It’s supporting new ways of working and socialising which is leading to the emergence of virtual worlds. 

Some hotel brands have announced projects in the metaverse, such as LEVEN in Decentraland and citizenM in The Sandbox. Timothy Griffin, principal at Wellbrook Hospitality (the company behind LEVEN), says the group has been working with a real architect to build the digital hotel, explaining that it would “help us connect the real LEVEN experience with the virtual” one. Surprisingly, there are planning restrictions within the metaverse such as air rights, which Griffin mentions will limit the project to three-storeys high. “We have to work with the space we have available in our plot,” he says, but that hasn’t prevented the team from replacing the elevator with a blimp. 

As interest in digital twins grows, technology providers are rolling out new products to meet the demands of hospitality and real estate professionals. According to Matterport, JLL was able to transact 85 per cent faster using digital twin technology, and hospitality properties with a digital twin can increase occupancy by 14 per cent. In November this year, Matterport launched a Property Intelligence tool to expand the efficiencies of digital twins, including the ability to predict required staffing levels, assessing the condition of real estate portfolios, visualising the location of furniture and equipment, and more.

Herein lies the potential value of digital twins. Considering recent progress in the creation of 15-minute cities, digital twins could become a viable first step in understanding the optimum performance and commercial success of projects. Hotel rooms, communal spaces, and entire neighbourhoods and cities could be designed, built and operated with purpose.

Tomas Nascisonis, CEO of Crypto House Capital, a virtual real estate venture, expects to see people exploring concerts, lectures, fashion shows, nightclubs, and art galleries in what he calls “metareal cities”. And CityZenith, an urban digital twin platform, is designing sustainable, virtual buildings to understand environmental impacts and provide actionable insights. This could benefit hotel owners, operators and developers by supplying them with the tools and data to inform real world decisions and ultimately increase asset value.

TV inspired travel 

“Armchair travel” – coined at a time when international borders closed during the pandemic – has amplified the role of video content. Left to our own devices and creative outlets, it became a source of travel inspiration until restrictions relaxed. During this time, streaming platforms such as Netflix, Prime Video and others served a similar purpose. Popular TV shows and movies were a welcome distraction from the banality of lockdown, and now they are proving to have a major influence on travellers’ decision making. 

Research from Expedia Group reveals that streamed movies and TV shows are now the top sources of travel inspiration (44 per cent), far outpacing the influence of social media (15 per cent). 39 per cent of global travellers have booked trips to destinations after seeing them on TV, with top countries such as New Zealand (The Rings of Power on Prime Video), the UK (Bridgerton on Netflix) and France (Emily in Paris on Netflix) ranking highly. 

The allure of TV inspired travel is even prompting suppliers to adapt. In spring this year, luggage delivery company My Baggage launched Jetflix, an interactive quiz where users can decide their next travel location based on their personal Netflix preferences. Paul Stewart, managing director of My Baggage, explains: “Television has allowed people access to lifestyles and worlds they would not have otherwise been a part of. This in turn inspires travel destinations and plans as people try to emulate the stars they see on screen.”

And fairly recently in October, travel guidance platform Tripadvisor launched a franchised limited series on Prime Video called The Wanderer. The programme follows a different presenter each episode, with the series collectively providing long-form travel guides of international destinations. Episodes are created in partnership with local destination management organisations (DMOs), and itineraries are informed by Tripadvisor’s traveller intent data. 

Christine Maguire, VP and GM of media at Tripadvisor, says: “We launched The Wanderer to give destinations a bold and compelling new way to reach prospective visitors outside the Tripadvisor platform as we explore the power of travel programming on platforms like Prime Video.”

Similarly, OTAs such as Expedia have since promoted vacation rentals which appear in feature films, as well as tours and activities curated around food documentaries and film locations. But as Tara Colpitts, senior director of market management at Expedia Group, notes: “When you consider that 78 per cent of people say they have made a travel choice based on ads they feel represented by, it’s not just the locations and locales that matter but also people.” 

A survey by Kimpton has revealed that 85 per cent of respondents think that travel brands’ social media content should be more inclusive of all kinds of travellers, and 33 per cent feel that their personal needs are not being met/might not be met by offerings from travel brands. If future marketing campaigns anchor on TV hits, it’s worth evaluating DE&I commitments. 


There is acute pressure brought about by various social, political and economic factors which are prompting many hoteliers to heavily rely on their local market. Simon Mahon, general manager at The Grand York, tells BHN: “I don’t think the full power and damage of Brexit has materialised. Not only has the cost of supplies gone through the roof, but delivery times have extended drastically. Orders can be unpredictable and capital items are getting stuck at customs. And then there’s highly talented people who want to work in the UK and they can’t enter the country. It’s detrimental to our industry.”

Russia’s invasion of Ukraine earlier this year has had a major impact on the travel and hospitality industries. For example, whilst energy supply to the UK has not been largely affected, increases in gas prices has caused electricity prices to rise too. Mahon notes that the annual electricity bill at The Grand York has increased from £400,000 to over £1,000,000. 

At the same time, hoteliers are raising wages in an effort to attract new staff. According to a survey from CGA by NielsenIQ and Fourth, one in nine hospitality jobs (11 per cent) remains vacant, down from a peak vacancy rate of 15 per cent at the height of the pandemic. Some hoteliers are recruiting overseas talent outside of Europe to help replenish staffing levels, whereas others are now relying on local pop-up schools such as Saira Hospitality to source and train employees. The non-profit organisation partners with multiple hotel brands within a given market and teaches a two-month curriculum combining brand standards alongside broader hospitality skills. Demand in London has been so strong that Saira has held two graduations since its May launch in the city. 

The rising cost of labour, materials, ingredients and more is placing the supply chain under serious pressure. In a recent BHN podcast, YOTEL’s VP of technical services, Mark Henderson, mentions how the company is working with local partners and owners to find different supply chains. He says: “In the last two to three years, there’s a trend for reliability and locally sourced. It’s not only the right thing to do from a sustainable approach, but it’s also the right thing to do for investors in terms of money, time, and for the betterment of the project. It might be more expensive to source locally, but it would mean the programme is less susceptible to being jeopardised by shipping times and costs are less likely to fluctuate.”

Some hotel brands such as The Hoxton and The Pig have built distinct identities by way of local partnerships. These partnerships paid dividends during the various lockdowns when alternative revenue streams were sought and businesses could continue to serve surrounding neighbourhoods. It kept brands at the fore of consumers’ minds, of whom is now looking for travel experiences rooted in local cultures.  

Hilton’s 2023 trends report, which is based on a global survey of more than 7000 travellers, reveals that 49 per cent of respondents are looking to be immersed in local cultures and products while travelling next year. Expect loyalty programs to be reimagined in line with this trend, and for brand activation companies such as Way to quickly scale. Within two years of launching, Way has just raised $20 million in Series A funding at a valuation of $100 million.

As hoteliers look to differentiate and stand out, greater attention will be paid to one’s competitive set. And considering Deloitte has recorded double digit growth in local markets as a result of hybrid working, there’s further opportunity to attract footfall. IHM’s editor-in-chief George Sell predicts that 2023 will be the year of flexible workspace, and some hoteliers have pivoted to provide coworking facilities.

But the challenge sits within food and beverage offerings, with top concerns stemming from the rise in operating costs, shipping disruptions and more. F&B will need to evolve, and Dan Rose-Bristow, owner of The Torridon, explains why. “Despite the supply chain challenges, hotels will still be expected to provide a good F&B service that includes nutritional and sustainable adaptations. Working with local farms, developing your own kitchen garden and working with local growers and local fishermen will all become more attractive to navigate the supply chain,” he says.

Branded residences

Growing interest in branded residences is arguably being spurred by increased time spent at home. Just as surveys and booking trends reveal a desire for luxury and adventure, the flight to quality is being mirrored within the residential sector. At the same time corporates and consumers are travelling with purpose, taking fewer trips but for longer, meaning that demand for a secondary home is on the rise.

Chris Graham, managing director at Graham Associates, argues that branded residences have proven highly resilient during Covid times. “Consistently, it offers investment security and a premium quality to buyers, and high returns to both developers and brands,” he says. “And over the past decade there’s been an explosion of brands entering the sector; it was typically the domain of luxury hospitality but it has now come to enter the upper-upscale and midscale tiers. Affordability is a key factor which is broadening the market.”

Looking ahead, supply levels are forecast to exceed 1,100 schemes by 2027, nearly doubling the current volume at around 640 projects worldwide. Accor has significantly expanded its presence in the sector, ranking third by number of completed properties in 2022 (up from fifth place the year before). When factoring in the group’s pipeline, Accor is expected to rank second behind Marriott and above Four Seasons in the top three parent companies of branded residences.

For some brands, 2022 has marked a notable year as the sector evolves. Shortly after opening its first city hotel with branded residences in New York, Aman secured investment of $900 million to fund expansion. Rosewood has also announced plans to launch its first standalone residential project in Beverley Hills in 2024.

And as Graham notes, new players are venturing into hospitality. Fila and Hello Kitty will debut branded hotels in 2024 and 2025 respectively, both joining Hyatt’s JdV portfolio. Judging by Hyatt’s upcoming supply of branded residences, the group is expected to climb three ranks to number six, sitting comfortably amongst the top 10 hotel parent companies. 

When it comes to new entrants, architectural firm WATG highlighted in its 2022 Branded Residence Atlas that lifestyle, upscale and non-hospitality businesses involved in the sector will rapidly increase. The report notes: “Boutique lifestyle operators, even those in the early stages of their expansion, are entering the residential market. These brands follow in the footsteps of more established players, notably the residential activity of Accor’s lifestyle joint venture Ennismore.

“Emerging brands in the sector include 1 Hotels, The Standard, Proper Hotels and NoMad. This includes standalone projects, such as The Standard Residences in Miami. For these brands, residences are another integral element of an increasingly broad and multifaceted lifestyle offering and demonstrates the centrality of residential product to the hospitality segment in the current era.”

Will Tindall, who established Emerging Advisory, a development company in 2016, is launching a new brand Escapade next year. With its first site at Silverstone Circuit, home of the British Grand Prix, Escapade will debut with 60 individual residences and will target additional sporting locations for future expansion. Tindall says: “Over the last decade, there has been a noticeable change in the expectations of the luxury consumer and traveller; a shift towards greater personalisation. They’re seeking out the most authentic experiences they can find that are true to the provenance of a location.

“When not in use by the owner, each residence at Escapade Silverstone forms part of our hotel offering and can be reserved by paying guests. This provides a strong yield for our owners, which is generated by the largest sporting venue in the UK. Regardless of wealth, property purchasers want an asset that can be enjoyed. Not only will the investment generate an inflation-hedged income, but it won’t become a burden for future generations in terms of costs or liabilities.”

Want to learn more? Watch BHN’s trends webinar here, which features additional insights from Adir Ron (Duve), Tara Colpitts (Expedia Group) and Chris Graham (Graham Associates). 

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