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Global Hotel & Lodging Industry

The global hotel industry (as part of the broad tourism leisure) is expected to reach almost $480 billion in 2015, according to research from Global Industry Analysts. Industry players are responding to a rise in demand, with plans for many new hotel developments in place.

Demand for hotel rooms is recovering in tandem with recovery in the wider economy following a dip during the recession. US luxury hotels are recording stronger recovery than other market segments. However, despite a fast rate of recovery, luxury hotels have been suffering from comparatively low revenue-per-room and occupancy percentage.

Due to saturation in established markets, industry players have been turning their focus to international markets, with regions boasting fast economic growth providing particularly lucrative prospects. One notable trend in the hospitality industry involves the demand for healthy hotel services, including customized menus in addition to wellness and healing programs.

Establishments in the hotel industry offer short-term lodging. The different types of establishments include hotels, resorts, motor hotels and motels. Apart from lodging, these outfits may also provide other services such as food and beverages, parking, laundry services, recreational services such as gyms and swimming pools, and business-oriented facilities like conference room and convention services.


China, Russia and India represent the fastest growing regions in the hotel industry, according to research from Timetric. Market growth is driven by rising demand, increasing average room rates, higher occupancy levels, overall tourism industry growth and leisure travel that is becoming increasingly affordable. In a Timetric survey of leading hotel industry executives, more than 40% responded their companies were forecast to increase procurement expenditure over the next year, while 20% expected to decrease procurement expenditure. Close to 40% of buyer respondents believed offering higher quality customer service would be the best way to encourage business. Just over 55% of respondents forecast increased marketing expenditure over the next year, with less than 10% expecting to decrease marketing expenditure. About 40% of hotel industry suppliers believed the ability to generate leads or organize customer meetings were the main element influencing choice of marketing agencies.

The boutique hotels industry saw tourism spending fall in 2008 and 2009, reports IBIS World. This is expected to turn around over the coming years, with increased demand fuelling higher revenue and boosting profit margins. Consumers can reserve their hotel rooms more easily thanks to technological development such as travel websites, online booking and mobile applications.

Regional Market Share

The UK hotel industry expanded by almost 5% in 2011, according to research from KeyNote. The industry had witnessed two years of decline previous to this growth due to the economic downturn and its negative impact on the global tourism industry. Market growth is fuelled by demand in London, where occupancy rates and revenue per available room are superior to that of regional hotels.

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