• May 31, 2023

The current hotel scenario: competition, boom and marketing

The international hotel industry is anything but kind. For a long time, there was almost no innovation in this field, but the advent of the technology-driven on-demand economy has drastically changed that. The arrival of Airbnb on the scene was an indicator of this change, along with the rise of boutique hotels. Soon, even traditional restaurant chains began to experiment, grow, acquire, and consequently innovate intensively.

This brings us to the current hotel scenario. Although it remains a brutal, inflexible, and fiercely competitive industry, the path to success is now multifaceted. There is no one formula that applies to everyone and hotels no longer have to subscribe to hard and fast rules. Technology plays the role of a great equalizer, giving even the smallest player a fighting chance to survive.


Around the world, the travel, tourism and hospitality sectors continue to be key to economic development and job creation. In this economy where transportation has become more affordable and country borders are blurring, it is fair to assume that travel and tourism will remain a dominant sector for the near and distant future.

Consider these statistics:

  • In 2016, travel and tourism contributed US$7.6 trillion to the global economy and created 292 million jobs.
  • This income generation comprises 10.2 percent of global GDP.
  • 1 in 10 of all jobs can be attributed to the travel and tourism industry.
  • At 77 percent, leisure travel was a part of people’s spending. By comparison, corporate and business travel accounted for the rest of the 23 percent.
  • Domestic travel (by 72 percent) was higher than international travel.
  • The total contribution to GDP increased by 3.1% in 2016.
  • By 2027, this sector is likely to account for 11.4% of global GDP and will generate more than 380 million jobs worldwide. Of course, this indicates that this sector will outperform the world economy.

There is no question that companies like Airbnb are competing head-to-head with hotels in certain market segments. This implies that part of the business may be additive, as travelers are taking more (and also longer) trips than they would without the option. What is important, however, is that private accommodations have altered consumer expectations on a fundamental level, by redefining what and where a hotel is.


Competition in the hospitality industry is the result of two things:

  • technological adaptation
  • Change customer profile

Technological Adaptation

As I said earlier, technology has leveled the playing field and has contributed to various facets of the industry, including branding, communication, and outreach. In particular, three particular trends are

set to reshape the hotel industry for years to come. Let’s look at each of them individually.

A mobile-first approach

In emerging markets around the world, one billion people are expected to connect to the Internet worldwide. Most of these will be customers experiencing their entire guest lifecycle on their smartphones. Hotel and travel companies have no choice but to invest in mobile-friendly and mobile-first guest retention and loyalty strategies.

Regardless, customers are always looking for that ‘personalized’ experience and leveraging innovative mobile technology the way AirBnb and Uber have been will be key when it comes to differentiation and brand experience. Hotels will need to offer booking functionalities, ultra-fast operations and other touch points for the entire customer journey on mobile phones for the convenience of their customers.


As Internet access becomes almost unlimited for digital natives and non-natives alike, connectivity is set to increase. Additionally, with the proliferation of connected devices and wearables on the market, hotels will need to innovate when it comes to new ways to interact and engage with the consumer. Virtual reality tours, augmented reality interactions, robotics and artificial intelligence will drive the market and prepare it for other travel experiences that can be offered indirectly.

Machine Learning, Big Data and Analytics

Harnessing big data enables the creation and curation of a broadly personalized experience for each type of consumer. Many marketing campaigns can be seamlessly leveraged and monitored against tangible numbers for growth and further optimization.

It also speeds up existing processes like customer service, feedback collection, email automation, and customer engagement. In addition, it can also facilitate the expansion and reduction of the business according to the objectives of the company.

Change customer profiles and brand experience

The tourism industry is witnessing a change in the psychographic and demographic profiles of travelers. Along with Gen X travelers is a new influx of millennials, whose expectations and lifestyle are setting entirely different standards for industry performance.

Customer experience is currently the most dominant brand differentiator. It will also boost customer loyalty and referrals and hotels will be needed to synthesize more targeted, personalized and intricate loyalty schemes than ever before.

This personalization and differentiation also extends to the types of experiences you create. The concept of ‘home away from home’ ends the homogenization of luxury, which was the previously proven paradigm.

Now, to provide unrivaled service, rooting the hotel in its local climate while also providing experiences beyond the conventional hotel space, has become an important factor. The age-old demand for organic food and sustainable options also creates more vulnerabilities when it comes to risks and food safety, which need to be monitored by hotel owners.

Travel brands have also lagged behind non-travel brands that have pampered customers by providing higher levels of service. Amazon, Starbucks, and Uber are some names that are held in high regard by millennials, and competition will only intensify as customers begin to expect the same from all service providers, especially in the hospitality industry.


This brings us to the last point: marketing to this new age consumer. Hospitality sales, such as they are, are different from other consumer goods. This is because both tangible and intangible items must be sold by the player. Success, then, depends more on providing marketing “services” than simply getting the consumer to buy what is offered. It is important to create the right brand image that fosters trust and, even more so, conversions.

A consistent brand identity also becomes more important as customers have multiple fronts on which they can interact with your brand. Your active presence on social media becomes very important as a portal for customer engagement.

Customers can also research and evaluate it better thanks to portals like TripAdvisor and Yelp. Reviews and recommendations from a friend or influencer suddenly become huge drivers of sales growth. In addition to providing a steady income stream, repeat customers can become influencers in their own right.

Taking advantage of all the tools and technologies that come with digital marketing is not only the need of the moment, but it is much cheaper and adjusts to the preferences of the client. Email and content marketing are now closely related to SEO and brand visibility on the web. Most of these marketing efforts go into carefully creating, curating, and maintaining brand identity and image. Continually engaging customers with new age marketing best practices, along with providing invaluable experience, will be what takes you above and beyond your competition.

The sector is extremely profitable at the moment and poised for immense growth and favorable amounts of investment. Whether you’re an existing player who isn’t performing very well, or a new player looking to make a significant dent in the industry, keeping all of these points in mind will give you a significant edge over your competition.

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