Despite the challenge of rising costs that outpaced revenue growth in 2024, the hotel industry has positive potential driven by trends in guest spending, shifting traveler behavior and upcoming major sports and entertainment events, according to the American Hotel & Lodging Association’s (AHLA) 2025 State of the Industry report, produced in collaboration with Accenture.
The report found that property-level costs overall rose faster than revenue and that specific expenses associated with operations and maintenance, sales and marketing and IT each rose nearly 5% in 2024, further intensifying a challenging hotel operations environment.
Rosanna Maietta, CEO, said, “America’s small business hotel owners have been struggling as rising costs, compounded by high inflation and interest rates, make it difficult to stay open and serve guests.” That’s why, she said, “we will be focused on promoting policies that help our members overcome these challenges so they can focus on what they do best — creating pathways for their employees to find lasting careers and creating unforgettable experiences for their guests.”
Liselotte De Maar, managing director, global strategy lead for travel at Accenture, said leveraging data and embedding technologies such as artificial intelligence can boost personalization of experiences across rising new customer segments, along with improving agility and cost-effectiveness. Done well, she said, “this can lead to increased loyalty, strengthened relationships and new growth opportunities.”
The report explained in detail how hotels can take advantage of opportunities to maximize revenue, including major sports and entertainment events such as the 2026 World Cup, which will be hosted by several US cities. It also highlighted other emerging travel trends that could provide opportunities to drive revenue and growth, including:
- Shifting demographics that offer a chance to create value across generations, as well as expanding specific offerings to growing segments like aging and solo travelers;
- Successful strategies by hoteliers to create new sources of revenue, such as camping accommodations, stays that are focused on entertainment or new partnerships through loyalty programs;
- Meeting the travel and accommodation requirements to support the growing number of events and experiences for attendees as well as staff, as cities across the U.S. are evolving into vibrant hubs of sports and entertainment tourism;
- Using technology and AI to create a more personal travel experience as people book trips and plan itineraries.
Image: Shutterstock
