Hotel Franchise Market Size
The hotel franchise market was worth $36.7 billion in 2023, and it is expected to grow at a rate of more than 7.5% from 2024 to 2032. This is because more people want distinctive and local experiences. As travelers' tastes change, several hotel chains are looking into boutique and lifestyle concepts to meet the needs of visitors who want more unique and personalized stays. The industry's expansion is also being shaped by a strong focus on local culture, community involvement, and real-life experiences.
The growing trend toward sustainability is making more and more businesses use eco-friendly materials, technologies that use less energy, and programs to cut down on waste. For example, in April 2023, Marriott International said again that it wants all of its hotels to get sustainability certification and all of its 650 properties to get green building certification by 2025. The market will increase a lot since more and more people want to stay in hotels that are devoted to responsible and sustainable business methods.
| Report Attribute | Details |
|---|---|
| Base Year | 2023 |
| Hotel Franchise Market Size in 2023 | USD 36.7 Billion |
| Forecast Period | 2024 - 2032 |
| Forecast Period 2024 - 2032 CAGR | 7.5% |
| 2032 Value Projection | USD 71.9 Billion |
| Historical Data for | 2018 - 2023 |
| No. of Pages | 265 |
| Tables, Charts & Figures | 300 |
| Segments covered | Chain Value, Hotel Type |
| Growth Drivers |
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| Pitfalls & Challenges |
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The growth of the hotel franchise business is mostly due to the growth and variety of luxury hotel options. Major participants in the market, like Marriott, Hilton, and AccorHotels, are focusing more on luxury hotel franchises because more and more people want to have high-end travel experiences. This trend shows that there is a growing need for luxury lodgings and also shows how important it is to cater to high-end customers.
Digital marketing methods that help hotels get more direct bookings while relying less on online travel agencies (OTAs) to save money will be a big part of the market's growth. Hotels are giving visitors more reasons to book directly through their own websites instead of through third-party sites. These reasons include discounts, room upgrades, and loyalty program perks. But the sector may not develop as quickly as it could because of strong competition from new companies entering the market and changing consumer preferences for other types of lodging, like vacation rentals.
Hotel Franchise Market Trends
Another new trend that is fueling market growth is the increasing use of technology to make operations more efficient, improve guest experiences, and make bookings more efficient. Franchise hotels are using contactless check-in and check-out more and more so that visitors may use mobile apps to get in and out without a key. Smart room technology is pushing guests to use mobile apps and in-room gadgets to control things like lighting, temperature, and entertainment in their rooms.
The rise of AI-powered chatbots and virtual assistants is also automating customer service by answering questions, giving information about the hotel, and helping with bookings. For example, in April 2023, Hilton launched the Property Engagement Platform (PEP), a new cloud-based hotel technology platform that helps with operations and meets the needs of guests and staff.
Hotel Franchise Market Analysis
In 2023, the midscale segment had almost $10 billion in revenue, making it the most popular type of hotel. This is because midscale hotels offer a good balance of cheap prices and good amenities, making them popular with a wide spectrum of travelers, including families and people on a budget. Midscale hotels are a fantastic value for money for posh hotels since they offer a comfortable stay with all the basic amenities, such free Wi-Fi, breakfast, and parking. The rise in the number of vacationers and the necessity to provide families with large accommodations and family-friendly amenities will help this category thrive.
The extended stay sector had more than 45% of the hotel franchise market share in 2023. This was because it was becoming more suitable for professionals including consultants, contractors, and project-based workers. Because more people are working from home and having flexible work hours, businesses need to provide long-term travel and lodgings for people who will be staying for a long time. More and more people are moving and need temporary lodging, and there are more corporate training programs and professional development programs, which will also make people want to stay in extended-stay hotels.
In 2023, the North American hotel franchise industry made up 35% of the revenue share. This was because more people were choosing different types of lodging and long-term stays in the area. Many hotel chains are going green to help the environment as more and more people care about eco-friendly policies and sustainability. More and more tourists are concerned about their health, which is why hotel chains are adding more wellness and lifestyle features, such gyms, spas, and healthy food alternatives.
For example, in October 2022, Peloton Interactive Inc., a well-known supplier of fitness equipment for the home, teamed up with Hilton to put its bikes in Hilton's U.S. hotels. The industry will also increase in North America since boutique and lifestyle hotels are becoming more popular as a way to offer distinctive and local experiences.
Hotel Franchise Market Share
Marriott and Hilton hold a major market share of over 15% in the hotel franchise industry. Leading companies operating in the hotel franchise industry are constantly engaging in various growth-based strategies, including partnerships, investments initiatives and acquisitions to reinforce their market footprint. For instance, Accor, a major international hospitality group managing a variety of hotel brands in different segments, is developing a unique know-how in boosting hotel performance while vigorously working on accelerating its sustainable growth.
These industry giants are increasingly focusing on offering diverse brand portfolios, catering to various market segments ranging from luxury to budget accommodations. Marriott, for instance, has been actively promoting its Bonvoy loyalty program, providing guests with personalized experiences and exclusive perks, while Hilton has emphasized sustainability initiatives to align with the growing eco-consciousness of travelers.
Hotel Franchise Market Companies
Major companies operating in the hotel franchise industry are
Hotel Franchise Industry News
- In November 2023, Accor Pacific announced its partnership with 120 hotels across a diverse portfolio of apartments, hotels, and resorts, marking a significant milestone in the success of its franchise hotel operations in New Zealand and Australia.
- In October 2023, Hilton disclosed plans to expand its franchise model in the category of upscale full services in Greater China through the inclusion of its DoubleTree by Hilton brand.
The hotel franchise market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD Billion) from 2018 to 2032, for the following segments
Market, By Chain Value
- Luxury
- Upper-upscale
- Upscale
- Upper- midscale
- Midscale
- Economy
Market, By Hotel Type
- Extended stay
- Residence
- Select service
- Others
The above information has been provided for the following regions and countries
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Nordics
- Rest of Europe
- Asia Pacific
- China
- India
- Japan
- Australia
- South Korea
- Southeast Asia
- Rest of Asia Pacific
- Latin America
- Brazil
- Mexico
- Argentina
- Rest of Latin America
- MEA
- UAE
- Saudi Arabia
- South Africa
- Rest of MEA
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