The top 10 travel and hospitality trends that will shape 2025

Despite economic headwinds, the desire to travel remains remarkably resilient. Today's travelers aren't just booking trips, they're seeking personalized, transformative experiences that leverage the latest technology while maintaining that essential human connection.

This shift to digital-first journeys, powered by AI and shaped by individual preferences, is more than a trend, it's a fundamental change in how people explore the world. For the hospitality sector, this creates both opportunities and challenges.

Against this backdrop of shifting demands and heightened expectations, the economic realities of 2025 add another layer of complexity. While inflationary pressures have constrained disposable incomes, the enduring desire to travel remains a powerful force. 

For the hospitality sector, the challenge lies in understanding how these financial pressures intersect with consumers’ evolving priorities, and using that insight to craft strategies that resonate in a competitive, value-conscious market.

Success in 2025 will hinge on how well hoteliers can:

• Balance innovation with authentic hospitality

• Deliver value in an increasingly price-conscious market

• Create experiences that resonate with digital natives

• Adapt to evolving financial realities while meeting higher expectations

1. Consumer caution continues into 2025, but the desire to travel remains

As outlined in our analysis of 2024 trends, the past year marked a stabilization in global hotel pricing and a more measured approach to discretionary spending by travelers.

The data tells an encouraging story for 2025. We're seeing projected declines in inflation across major markets, coupled with expected growth in real wages. In 2025, inflation is projected to decline further, offering a slight boost to real wage growth in key markets.

While this improvement may be modest, it has the potential to ease financial pressures of many travelers, which, when coupled with the broader sentiment of prioritizing the experience economy, paints a cautiously optimistic picture for the year ahead.

According to a survey by Skyscanner, 43% of their global sample said that they intend to travel more in 2025, while only 9% anticipate scaling back their plans. 

Similarly, 37% of respondents plan to spend more on flights, and 31% intend to increase their spending on hotels compared to 2024. These findings indicate a rebound in confidence, even as travelers remain value-driven.

The value-conscious mindset of travelers will continue to shape the industry in 2025, driving trends that reflect a nuanced blend of priorities. 

Many travelers, drawn to authenticity and novelty, are seeking out emerging destinations that offer compelling value propositions and unique experiences - away from the crowds and the costs of traditional hotspots. Social media continues to amplify this shift, serving as both inspiration and guide for those seeking to venture into lesser-known locales.

Simultaneously, package holidays and all-inclusive resorts are seeing a resurgence, particularly among younger Gen Z travelers, who value affordability and convenience.  Expedia's 2025 trends report noted a 60% year-on-year increase in searches on Hotels.com using the ‘all-inclusive’ filter, with 42% of Gen Z travelers favoring such options.

What's changed isn't the desire to travel—it's how people approach it. Today's travelers are more strategic, seeking maximum value without compromising on experience. This shift presents an opportunity for hospitality providers who can deliver compelling value propositions.

Business travel is also poised for continued growth, with the GBTA forecasting a 10.4% increase in overall spending. This momentum is expected to push global traveler numbers beyond 2019 levels and place spending comfortably above pre-pandemic benchmarks in both nominal and real terms.

2. Optimism grows for Asia-Pacific hoteliers amid rising travel demand

Few regions have endured as difficult a recovery as Asia-Pacific, where the lingering effects of the pandemic and a slower-than-anticipated return of Chinese travelers have kept hoteliers cautious. 

Advertised room rates are expected to decrease by 11% in H1 2025 compared to H1 2024 but our demand metrics tell a more optimistic story for the region. Lighthouse analysis shows 121 days of elevated demand in the first half of 2025, far outstripping the previous year.

Beneath the cautious advertised room pricing in the region lies a steadily improving demand landscape that hints at a brighter future.

This strengthening demand is echoed by broader industry indicators. Expedia’s Q4 Traveler Insights report revealed that Asia-Pacific is the fastest-growing region for search volume, recording a 25% increase quarter-on-quarter (QoQ) and 35% increase year-on-year (YoY). 

This upward trend aligns with the sentiment of affluent travelers in the region: a survey conducted in late 2024 found that 81% of affluent Asian consumers continue to prioritize travel despite inflation, with 39% placing it above major purchases like home improvements, or luxury goods.

3. India’s luxury hotel sector: A star on the rise

India's luxury hotel sector is emerging as a standout success story in global hospitality. As the world's fastest-growing major economy, India is set to double global GDP growth rates in 2025, creating ripple effects across its hospitality landscape.

This momentum is being fueled by two powerful forces: a rapidly expanding domestic market with increasing appetite for premium experiences, and growing international recognition of India as a leading travel destination.

The luxury hotel market has been a clear beneficiary of this momentum. In the first half of 2025, pricing data reveals that India’s five-star hotels are leading global markets in year-on-year price increases, with rates consistently climbing by double digits and peaking at a remarkable 47% increase by mid-year, compared to actualized prices in 2024.

This surge, coinciding with the global peak tourism season, underscores the strength of India’s travel economy and the growing appetite for premium experience among its domestic consumer base. 

India’s success illustrates the interplay between domestic demand and international appeal, positioning it as a critical driver of growth in the Asia-Pacific region and strengthening its potential within the global tourism landscape.

4. The steady advance of short-term rental growth

Despite efforts in recent years to curb the rapid growth of short-term vacation rentals in some locations there was little indication in 2024 that supply expansion is slowing down overall.

Our data tells a compelling story: across nearly global 500 markets, total supply grew by 13% from October 2023 to October 2024. 

This growth is particularly striking in major markets. Among the top 25 destinations by property count, Istanbul stands alone in showing a supply decrease.

Paris saw a particularly dramatic surge, with listed properties rising by 47%, driven by owners eager to capitalize on demand from the 2024 Olympics. Other fast-growing markets included Dubai (39%), Marrakech (29%), São Paulo (28%), and Rio de Janeiro (23%), reflecting Latin America’s strong performance in overall travel demand growth.

Regulation remains a significant factor influencing market dynamics. For instance, Argentina’s decision to scrap rent control laws  freed up property usage, contributing to a 20% increase in vacation rental supply. 

Conversely, Turkey introduced stricter permit requirements for rentals in October 2023, resulting in the five fastest-contracting markets in our database being located within the country.

Similar trends were observed in New York, Scotland, and Spain, where tightened regulations and enforcement caused supply contractions in Glasgow (-16%), Queens, New York (-7%), Edinburgh (-6%), Palma de Mallorca (-4%), Brooklyn, New York (-2%), Ibiza (-1%), and Menorca (-1%), despite robust demand growth in all these destinations.

With consumers looking to find special and unique vacations in new locations, short-term rentals are well positioned to cater to this and, overall, the market is growing to accommodate this. However, as some of the outliers of declining supply show, owners need to keep a close eye on the regulatory situation and how it can rapidly alter the market. 

This sustained growth is fundamentally reshaping the competitive landscape for traditional accommodations. 

Our research shows the shift is particularly pronounced in North America, where short-term rental listings in Booking.com's top ten searches have surged 36.7% year-over-year. This highlights a transformation of how travelers search for and book accommodations.

To stay competitive, it is crucial to have comprehensive pricing intelligence not only on hotels but also on short-term rentals, ensuring a complete understanding of the evolving competitive landscape.

5. The evolution of event-driven travel: New patterns emerge

The post-pandemic period ushered in a golden era for live events, with travelers eager to experience large-scale sporting, musical, and cultural gatherings. 

However, our 2025 data reveals a more nuanced picture. While event-driven travel remains robust, hotel pricing dynamics are shifting. Events that drove premium hotel rates in 2022-2023 are showing signs of price stabilization. 

This isn't a decline in demand, it suggests a maturing market where both travelers and hotels are finding a more sustainable balance.

Our analysis indicates this pricing plateau spans across event types, pointing to a broader market evolution rather than isolated trends. For hoteliers, this shift demands a more sophisticated approach to event-based revenue strategies.

Our data reveals that hotel room rates in some destinations are plateauing around events in 2025 compared to 2024. Notable examples include:

• NCAA Division 1 Women's Basketball Finals in Tampa: -69%

• NCAA Division 1 Men's Basketball Finals in San Antonio: -29%

• Tulip Festival and King's Day in Amsterdam: -28%

• Kyoto Cherry Blossom Festival: -24%

• Calgary Stampede: -21%

• Spanish Grand Prix in Barcelona: -17%

• Daytona Bike Week: -17%

• Chinese Grand Prix Grand Prix in Shanghai: -16%

• Sydney Mardi Gras: -14%

• Daytona 500: -12%

• Rockville in Daytona: -12%

• The Masters in Augusta: -8%

• New Orleans Jazz Festival: -6%

Despite this, many unique, location-specific cultural events continue to drive strong demand and higher pricing.

Standouts include the Eurovision Finals in Basel, where room prices have surged to over double their usual levels, reaching $472. 

While Taylor Swift’s record-breaking Eras Tour has concluded, the demand for concert-driven travel remains strong. Oasis appears to have picked up the baton, driving significant hotel price increases over their concert dates, though not to the same extent as superstar Swift.

Early pricing data reveals striking trends. In Cardiff, average advertised hotel prices during Oasis concert dates are currently £383, compared to £124 on the same dates in 2024. Similarly, in Manchester, the band’s hometown, advertised prices have risen to £292 over the gig dates, up from £114 for the same period in 2024. 

These numbers highlight the continued influence of major live music events on hotel pricing, particularly locations where bedstock is limited, compared to larger destinations such as London, where the Oasis concerts haven't had as much of an impact on room pricing yet.

Alongside Eurovision, other events that are achieving much better YoY pricing performances include:

• New Orleans Mardi Gras: +34%

• Edinburgh Festival: +25%

• Sapporo Snow Festival: +18%

• Rio Carnival: +18%

• The Indy 500: +16%

• CMA Country Music Festival: +11%

• Comic Con San Diego: +11%

• Coachella Music Festival in Palm Springs: 10%

• Super Bowl 2025: +9%

This divergence highlights a more nuanced picture for event-driven travel in 2025. While some events may have diminished in their ability to drive up accommodation pricing, destination-specific cultural experiences and unique events - such as the Oasis concerts - are demonstrating strong resilience.

For accommodation providers, these shifts emphasize the critical need for context-specific, forward-looking search data to accurately anticipate market demand. Leveraging this data enables you to optimize pricing and promotional strategies, ensuring you capture the key revenue opportunities that events like these continue to deliver.

6. The rise of authentic travel beyond tourist hotspots

A powerful shift is reshaping travel preferences in 2025: the search for authentic, personal experiences is moving from niche to mainstream. Travelers are increasingly venturing beyond traditional destinations, seeking genuine connections and unique moments.

Our data underscores this shift, showing growth in emerging destinations as per our look at 2024 trends. 

Insights from other leading travel companies further highlight this trend. Skyscanner’s research found that over a quarter (26%) of global consumers plan to visit less touristy or crowded areas in 2025. 

Similarly, Expedia survey data revealed that 63% of travelers would consider detouring from major destinations to explore lesser-known locations. Hilton’s 2025 trend survey also noted that a quarter of respondents are seeking unique experiences, while a fifth are prioritizing outdoor activities.

These aren't just statistics, they signal a fundamental change in how people want to travel. The modern traveler isn't just looking for a destination; they're seeking experiences that resonate on a personal level.

7. AI adoption will transform Revenue Management

It may come as little surprise that the integration of AI in hospitality is accelerating.

Our latest research reveals that 63% of hoteliers are already leveraging AI across their operations, from pricing decisions to market analysis. But we're just scratching the surface.The industry verdict is clear and compelling:

• 75% of respondents expect AI to help them improve their revenue management decisions in the next 5 years

• 83% of respondents anticipate that AI will help them save time and increase productivity in the next 5 years

• 75% of respondents rated AI’s future impact as either a 4 or 5 on a 5-point scale

Yet adoption isn't uniform. Global chains are leading the charge, with 40% of respondents from these organizations already using AI for data analytics, compared to only 27% in independent hotels.This disparity indicates that early adopters will continue to gain a competitive edge in the evolving hospitality landscape.

For independent hotels, AI isn't about replacing current expertise, it's about amplifying it. 

Think of AI as your always-on assistant, handling routine tasks while you focus on strategy and guest experience. By processing complex data sets, automating repetitive work, and sharpening competitive analysis, AI transforms how you approach running a hotel.

The message for 2025 is clear, AI is becoming as essential as your property management system (PMS) for instance. Those who embrace this shift are putting themselves in pole position for success in 2025 and beyond.

8. The rise of Total Revenue Management and the search for ancillary revenue

As travelers increasingly prioritize unique and meaningful experiences, the opportunity for ancillary revenue growth in the hotel sector has never been greater. 

To capitalize on this trend, revenue managers will likely turn to Total Revenue Management . 

Total Revenue Management shifts focus from traditional room revenue to capturing the complete value of each guest's stay. From dining experiences and spa services to parking and event spaces, this holistic approach ensures every revenue stream is optimized.

The ultimate goal of Total Revenue Management is to increase Total Revenue Per Available Room (TRevPAR) or Revenue Per Available Guest (RevPAG), ensuring that no revenue opportunity is overlooked. 

While Total Revenue Management has been discussed in hospitality for years, advancements in hotel technology are now making it a viable strategy. 

Business Intelligence solutions, with an integrated PMS enable hoteliers to analyze data, predict guest behavior, and implement real-time pricing and upselling strategies for all services.

But Total Revenue Management’s impact goes beyond the bottom line. By enabling more personalized offerings and bespoke experiences, it directly enhances guest satisfaction. In an era where online reputation drives bookings, this connection between revenue optimization and guest experience becomes crucial.

9. Personalization will be the new standard in 2025

The definition of hospitality is always evolving. Today's guests don't just see a hotel as a room for the night, they invest in an experience. This fundamental shift demands a new approach to personalization, one that anticipates needs before they arise.

This evolving mindset has led guests to actively seek personalized, meaningful offers, with growing interest in on-site amenities such as dining, spas, and curated local activities.

Technology is making this level of service possible at scale. AI and predictive analytics are transforming how hotels understand and serve their guests.

Real-time engagement

AI tools, including conversational interfaces, now deliver instant, personalized recommendations for everything from local experiences to dining options. While this technology is still maturing, it's already enhancing guest satisfaction by providing timely, relevant assistance.

Smart marketing

Marketing teams can also harness AI to create highly personalized email campaigns, offering tailored suggestions based on a guest’s previous stays and preferences. From room upgrades to bespoke dining experiences, these targeted campaigns enhance the guest journey while driving engagement and revenue for hotels.

Data-driven decision making

In addition, advanced data analytics are enabling hoteliers to gain deeper insights into guest behavior. By analyzing preferences and booking patterns, hotels can optimize pricing, craft precise marketing offers, and create upselling opportunities that resonate with individual guests. 

For example, forward-looking search analytics can reveal demand trends and stay patterns, empowering hoteliers to adjust pricing strategies and deliver personalized offers to potential bookers.

Personalization is no longer a luxury, it’s an expectation. The hoteliers that embrace this change and leverage technology to meet these demands will thrive in satisfying their guests.

10. The distribution landscape in 2025, one of evolving challenges

While rate parity is seen to maintain transparency and prevent guest confusion, it also poses significant challenges for hoteliers. High OTA commissions and the operational burden of monitoring rate consistency (or disparity) have led many to question its long-term viability. 

At the same time, in the eyes of OTAs, direct booking initiatives, loyalty programs, and exclusive offers are shifting the balance of power back toward hoteliers.

Regulatory reshaping

In a landmark decision in September 2024, the EU’s Court of Justice ruled that Booking.com could no longer enforce price parity clauses in contracts with hotels across the European Union. The court argued that these clauses stifle competition and are unnecessary for platform viability, signalling heightened regulatory scrutiny of parity practices.

While currently specific to Booking.com, the ruling's implications could ripple across the industry, potentially leading to more competitive commission rates.

Platform evolution

Adding to the shifting landscape, Google has made significant changes to its European services in response to the EU’s Digital Markets Act. These changes include boosting comparison sites in search results and removing features like flight info and clickable maps. While these adjustments benefit large aggregators, they have negatively impacted airlines, hotels, and small retailers, with direct booking clicks dropping by as much as 30%.

In the U.S., the Department of Justice’s ongoing antitrust case against Google raises the possibility of drastic measures, such as breaking up its core businesses, restricting data collection, and opening its search indexes to competitors. The outcome could significantly reshape the online search ecosystem yet again.

The distribution environment remains complex and ever-changing. Despite the uncertainty, the influence of OTAs and metasearch platforms on pricing and distribution strategies will continue to play a critical role in how hotels compete. 

To address these challenges, you should rely on quality data and industry leading technology. Tools that optimize online distribution and automatically detect and resolve parity issues can provide a competitive edge in what could be a turbulent 2025.

Key takeaways for hospitality professionals

As we've explored, 2025 marks a pivotal evolution in hospitality. One where AI meets authenticity, where data drives personalization, and where traditional boundaries between accommodation types continue to blur. 

In response to these shifts, here are key strategies to ensure you are ideally positioned to seize the future of hospitality.

Actionable strategies

1. Invest in AI as a strategic tool for your business

Leverage AI to automate routine tasks, enhance pricing decisions, and improve forecasting accuracy. With 83% of hoteliers expecting productivity gains from AI, it's becoming essential for competitive advantage.

2. Adapt to short-term rental competition

With short-term rentals appearing in 36.7% more top-ten searches on Booking.com, they're now direct competitors for traditional accommodations. 

Stay competitive by monitoring rental pricing in your market, understanding their unique value propositions, and differentiating your property's offerings through amenities and services rentals can't match.

3. Target value-conscious travelers

With 43% planning to travel more but staying cost-conscious, focus on delivering clear value propositions. Create compelling packages that appeal to both experience-seekers and value-hunters.

4. Optimize event strategies with the right data

Use forward-looking search data to identify pricing opportunities around events. Remember that while some events show pricing plateaus, unique cultural experiences continue to drive strong demand.

5. Leverage Total Revenue Management

Move beyond room revenue to optimize all revenue streams, from dining to spa services. Use integrated systems to analyze guest behavior and implement real-time pricing across all services.

6. Maintain an agile distribution strategy

Monitor regulatory changes affecting OTA relationships and adapt to evolving platform dynamics. Use technology to automatically detect and resolve rate parity issues while maintaining competitive positioning.

From Asia-Pacific's recovery to India's luxury boom, from the transformation of event-driven travel to the rise of total revenue management, for hospitality professionals the opportunities are as diverse as they are exciting.

Success in this landscape requires a strategic balance:

• Embracing AI while maintaining the human touch

• Capturing value from every revenue stream

• Understanding and adapting to shifting distribution dynamics

• Delivering personalization at scale

• Staying ahead of competitive pressures from both traditional and alternative accommodations

But perhaps most importantly, 2025 demands a new level of commercial intelligence. One that transforms data into actionable insights, technology into competitive advantage, and market knowledge into revenue opportunities.

At Lighthouse, we're not just observers of these trends - we're helping shape them. 

Ready to turn 2025's challenges into opportunities? Get in touch today.