3 Independent Hotel Trends to Watch in 2017

The hotel industry is a constantly evolving marketplace, where trends can come and go in the blink of an eye. This is particularly true in the independent sector of the market, where a high volume of brands strive to compete with each other and the leading chains.

Make no mistake; 2017 is likely to be another exciting and progressive year in the independent hotel sector, as market forces and consumer behaviour continues to drive significant change.

Here, we will look at three of the seminal trends that are likely to shape the market during the coming year.

 

#1 – Independent Hotels Will Continue to Perform Well in the Luxury Market

2014 saw independent hotels make considerable gains in terms of performance metrics, particularly when compared with larger chains. Most interestingly, it was revealed in the U.S. that independent hotels operating within the luxury market were performing at a higher level than the national average, as they continued to narrow the gap in terms of ADR (Average Daily Returns).

This trend has continued gradually throughout 2015 (and in numerous international markets too), to the point where luxury, independent brands actually boast a competitive advantage over chains in terms of ADR and profitability.

We can expect this trend to continue, particularly with independents’ becoming increasingly creative in their attempts to offer affordable luxury to guests.

 

#2 – The Independent Market Will Continue to Be Technology-led

With improved ADR and optimal occupancy rates, there are clear reasons for optimism among independent hotel brands. This comes despite reports that the sector has decreased in size during the last decade, with independents’ now accounting for just 7% of the UK market share.

This suggests that while many independent hotels have struggled with the pace of advancement, a lack of investment and the wealth of major chains, those that have survived have managed to stream-line their operation and achieve higher profit margins. More specifically, they have leveraged innovation and locality to optimise their natural advantages and position themselves in a way that meets the demands of modern travellers.

Although the independent hotel market is unlikely to contract by much more in 2017, the most successful brands will continue to embrace technology as a way of adapting to the needs of contemporary guests.

 

#3 – Concept Hotels Will Continue to Drive the Independent Market

As the independent market has become increasingly stream-lined, we have also seen brands look to create more clearly defined value propositions. This offers an excellent opportunity for some hotels to capitalise on their unique location, or the sense of freedom that is inherent to independents.

The most significant embodiment of this is the rise of concept hotels, which usually operate according to a tight, creative theme. Take the Book and Bed in Tokyo, for example, which opened towards the end of 2015 (in conjunction with independent book publisher Shibuya Publishing) and offered guests access to a 1,700 strong library and a literary-themed interior.

We are likely to see a wider range of concept hotels enter the market in 2017, as independents’ celebrate their uniqueness and create themes that help them to compete more aggressively with their rivals.

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