86% of luxury hotels expect revenues to rise in 2023, research finds

Some 86% of senior executives of large luxury hotel chains expect revenues to increase this year compared to 2022, according to new research commissioned by communication technology company Communications Specialist Ltd. Nearly one in 12 (8%) of the senior luxury hotel executives interviewed anticipate revenue growth of up to 10% on last year for the organisations they work for, and half predict growth of between 10% and 30%. A further 12% anticipate growth of between 30% and 50%, and some 16% expect revenue to be at least 50% higher. When comparing expected revenue streams for this year to 2019, 92% anticipate some form of revenue growth. A key reason for the level of optimism amongst senior luxury hotel executives is that 90% expect occupancy rates at the hotels they work for to be higher this year than in 2022 while 18% predict they will be ‘significantly higher’. For the high-end, luxury hotel market as a whole, the corresponding figures are 78% and 20% respectively. When asked for other reasons for optimism around revenue growth, 70% of senior hotel executives interviewed cited the growing population of mass-affluent and high net worth individuals, and 57% said it was because people are generally looking to spend more on their holidays following the Covid-19 lockdowns. In addition, 39% said it is because the luxury hotel market experience has improved and become even more sophisticated, and 33% said it was due to the guest experience becoming more personalised. However, although revenues are expected to rise, all of the respondents interviewed say overall costs for the high-end, luxury hotel market will be higher in 2023 than last year. One in four (24%) expect them to be at least 30% more. Kevin Buchler, chief marketing officer at Communications Specialist Ltd, said: “Our research shows that the luxury hotel market is very optimistic about market growth this year. They expect occupancy rates to be higher than in 2022, and there are several factors such as a growing population of mass affluent and high net worth individuals supporting long-term growth in the sector. “Our findings also suggest that there is still a ‘bounce-back’ from the pandemic with many people wanting to spend more on their holidays this year to make up for the lack of vacation time during the recent Coronavirus lockdowns.” Buchler continued: “It is also clear from our study that standards continue to improve in the high-end hotel market, and key to this is investing in technology to ensure even higher levels of efficiency and customer service.”