Five hotel industry trends for 2023 how to make them work for you

Having worked in the hospitality business for a long time, I feel we often underappreciate just how resilient – and adaptive – this industry is. In just the past couple of decades, we have seen the hotel distribution model upended by Online Travel Agents (OTAs), a major competitor’s arrival in the shape of Airbnb (and its emulators), and then a global pandemic hitting.

And yet, the hospitality industry keeps on rolling, adapting to new realities and consistently treating trends as opportunities. Amid a backdrop of strong hotel development pipelines in many regions, here are five trends to be aware of.

1. Welcoming the working nomad

Hotel operators have an opportunity to embrace the new generation of digital nomad remote workers who combine employment with international travel. While accepting there are many jobs which cannot be done remotely, the knowledge and services economy is less restrictive in this area, especially given the exponential rise in use of videoconferencing and collaborative working applications.

For hotel operators, responding to this opportunity is about much more than just installing good Wi-Fi; there has been a sea change in attitudes, too. These new generation remote workers are interested in community, in being among like-minded peers, and in enjoying a better balanced life. 

At the same time, when they are working to a deadline, they do not necessarily want to be surrounded by vacationers. It means the age of the bland and forbidding hotel business centres is over. We can expect to see funkier co-working spaces established, as well as suites being reconfigured to include a desk and office set-up which converts to a functional meeting space when required.

2. The rise of wellness tourism

As a hospitality consultant, I get more calls from hotels looking to reposition into health and wellness tourism than any other trend.

However, hotels need to understand that such a repositioning may not be as simple as it seems, nor is it without risk. Much depends on location, given that most hotels cannot afford to have full-time medical and wellness experts on the payroll. Are such professionals available close by? Also, several brands are already operating successfully in this sphere, so it is important to check the local competitive set before making a significant financial commitment.

Often, it may be better to look at smaller changes which can appeal to health-conscious guests without breaking the bank – something I call ‘light wellness’, which you can tap into by putting healthier choices in the minibar, for example. It is a tiny gesture that can create a warm glow around your brand. It is also increasingly common to offer pillow and mattress menus, but why not also introduce sleep and wake-up rituals aligned to circadian rhythm cycles? You do not have to open a bespoke vegan restaurant, or spend millions renovating your spa, to be thought of as a wellness-conscious hotel.

3. Deploying smart technology in hotels

The hotel industry has an unbalanced relationship with technology. We tend not to be pioneers in technological development, choosing instead to take on applications developed elsewhere then look at how they can be integrated into so-called smart hotels.

The hotel reception is not the same as an airport check-in, as the need for a warmer welcome and a degree of personalisation is much greater. If I am your guest, why not give me the option to check-in from a smartphone app while I am still in my taxi heading from the airport? Crucially, as a guest, if I wish for some human interaction, there should be employees who have been liberated from the reception desk and are in the lobby to greet me, answer my questions and give me tips on the best places to go for food, drinks or sightseeing. As a guest, it immediately makes me feel that the hotel is well integrated into its surrounding community.

This kind of customer-facing role requires excellent soft skills, as well as an encyclopaedic knowledge of the destination, and is thus more rewarding both professionally and potentially in terms of remuneration.

4. Marketing gets ‘transformational’

We often talk about hospitality being part of the wider ‘experience economy’. More recently, there is the notion of the ‘transformation economy’, where experiences are elevated from mere enjoyment to actual personal transformation.

What does this mean for hotel marketing? I think we will see a shift in messaging to amplify this notion of transformation through travel experiences, and particularly around health and wellness. Messaging will also become even more personalised – down to a granular level – especially in the luxury segment. Digitalisation makes such moves easier to pull off.

The message will evolve to something like, “I see you are travelling because you are trying to change something in your life. We can be part of that journey by being the place where you sleep, where you look after your health and fitness, or by becoming your place of work while you explore how your career can move forwards”.

One of the brands already doing this successfully is Equinox, which began in fitness but has now opened what it calls “the fittest hotel on Earth” in New York’s ultra-trendy Hudson Yards. 

5. Can the hotel ‘brand explosion’ last?

While the other trends can primarily be seen as opportunities rather than risks, one other concern is the fragmentation of the hotel sector into a plethora of sub-segments, each with their own stable of competing brands.

This topic is much more open to debate; while choice is generally a good thing for a consumer, has this process gone too far in the hotel business? Are customers becoming more confused than inspired by being faced with so many brands? Will they feel that once-independent brands, which are now part of a multinational group, can still deliver authentic experiences?

I personally think that such concerns are valid, and that in time we may see some rationalisation as the larger operators focus on one brand in lifestyle, one in boutique, and whatever other categories arise as brand explosion moves on.