The 8 travel and hospitality trends that defined 2024

Despite these economic hurdles, travel remained a priority, with many travelers adjusting their behavior to maximize value within constrained budgets.

Emerging destinations arrived as standout performers, capturing consumer attention as budget-conscious travelers sought affordable alternatives. Major European package holiday hotspots also thrived, benefiting from this value-driven shift. 

Helping guide these choices were the growing influence of social media and the rise of artificial intelligence (AI) powered tools, which empowered travelers to discover and feel confident exploring less traditional destinations.

Behind the scenes, AI has become an indispensable asset in the hospitality industry. A survey conducted by Lighthouse revealed that nearly two-thirds of hotels now utilize AI for revenue management, leveraging it to process vast amounts of data and make smarter pricing decisions. This integration has enabled hoteliers to navigate the complexities of a constantly evolving market with greater precision and agility.

In 2024, travelers and technology pushed boundaries, proving that even in challenging times, innovation and adaptability can unlock new possibilities for the hospitality and travel industry.

1. Inflation has fallen, but travelers continue to feel the squeeze

While the spike in inflation subsided in 2024 and price rises were within a normal range in most major economies, the impact on the consumer psychology, and wallet, remained. 

This is not to say that travel was on the chopping block for global consumers. The UNWTO World Tourism Barometer noted that international traveler numbers rose and reached 98% of 2019 numbers in the first nine months of 2024, and in regards to spending “35 out of 43 countries with available data on receipts exceeded pre-pandemic values in the first eight to nine months of 2024.” It expects the number of tourists to reach 2019 levels across 2024 and spending to be above their pre-pandemic numbers.

However, travelers in 2024 were noticeably more focused on maximizing the value of their discretionary spending, showing greater cost-consciousness compared to the post-pandemic travel surge and the freer spending habits in 2021-2023 that followed the lifting of lockdowns.

This trend was reflected in a more stable pricing environment for hotels in 2024. Year-on-year (YoY) changes in average room prices during the first 11 months of the year remained moderate, with some markets seeing slight declines, creating opportunities for travelers to find competitive rates while still supporting steady demand.

Europe and Latin American hotels performed best YoY, with room prices posted coming in 4% and 9%, respectively. In contrast, rates trod water in North America (2%) and Oceania (1%) and fell in Africa (18%) and Asia (11%).

2. Ongoing challenges in China impact travel demand, particularly across Asia

The conservative spending habits of Chinese travelers significantly impacted global hotel pricing performance in 2024.

This trend traces back to 2020, when emerging weaknesses in China's property sector began affecting the broader economy. Given Chinese consumers' heavy exposure to the property market, the sector's struggles created a substantial drag on overseas travel spending.

The impact is particularly evident in destinations traditionally popular with Chinese tourists, which dominated the list of countries showing the weakest hotel rate growth in 2024. These included: Cambodia (-25%), Japan (-5%), Laos (-14%), Philippines (-8%), Singapore (-3%), Taiwan (-8%), Vietnam (-8%), and China itself (-9%). 

The viral hashtag "traveling like special forces" that swept through Chinese social media earlier this year captured this shift in tourism behavior. The phrase describes a minimalist approach to travel - seeing the maximum number of sights in minimal time while spending as little as possible - reflecting the broader trend of reduced Chinese tourism spending throughout the year.

3. A package for success: The return of package holidays

Cost-of-living pressures in 2024 drove consumers to seek greater value, sparking a renaissance in package holidays.

After the post-pandemic surge in luxury independent travel, the pendulum swung back as more travelers turned to travel agents, prioritizing the cost efficiency and convenience of bundled vacation packages.

In the UK, Barclays data consistently found that growth in spending by British consumers on travel agents exceeded those for retail spend and travel more generally, notably beating the wider market across the peak period. 

YoY spending on travel agents grew 10.5% in July, 7.2% in August, 9.2% in September and 7.8% in October, consistently outperforming the rate of spending increase across the broader travel category. 

Euromonitor forecasts that overall spending on package holidays will have risen 11% in 2024 to $117 billion and rise again in 2025 by 7.6%. 

Major operators in the package holiday sector have consequently reported strong results, putting the lean years of the pandemic far behind them. TUI posted full-year guidance expectations of more than 10% growth in 2024 and their earnings to rise by over 25%. 

Jet2 reported that their 2023-2024 revenue was up by just under 25% as a result of a growth in leisure travel and year-on-year and its interim results for 2024-2025 showed a 15% increase.  Meanwhile Flight Centre reported a 19% increase in group revenue in fiscal year 2024.

Greece and Spain, two of the most popular destinations for vacations through travel agents, were the best performers for hotel pricing growth in 2024 among Europe’s big tourism destinations. 

In these two countries, prices rose by a little over 6%, compared to a 1% fall in Italy, which is more popular with tourists constructing their own itineraries. It is also substantially more expensive on average, especially after rates soared there in 2023.

4.Value-seeking travelers drive hotel prices higher in emerging destinations

The quest for value extended across various global regions, driving significant increases in hotel prices, particularly in two key areas: Central America and Eastern Europe, including the Balkans. 

These regions attracted growing numbers of visitors by offering a compelling combination: the allure of new experiences at competitive prices.

In Balkan countries based around the Adriatic, hotel prices saw notable increases, particularly in the most affordable destinations. While average rates rose modestly by 4% in Croatia and 2% in Montenegro during the first 11 months of the year, revenue managers adopted a more aggressive approach in Bosnia (16%), Macedonia (9%), and Slovakia (9%). 

These latter 3 locations, being more affordable than Croatia or Montenegro, underscore the trend of consumers seeking value by exploring less traditional destinations.

Central America was also a standout performer with hotel rates increasing significantly. Colombia experienced a 6% rise, while Guatemala led the region with a remarkable 27% surge. Other countries, including Belize, Costa Rica, El Salvador, Mexico, and Nicaragua, saw consistent rate growth of 9-10%.

This trend reflects a broader shift in travel patterns, as value-conscious consumers venture into less-traveled regions. The search for affordable experiences is pushing travelers to explore destinations they might not have considered before, expanding the global tourism map.

5. Business travel continues to make a comeback

Business travel continued its steady recovery from the pandemic, achieving impressive growth by the end of 2024. While spending in 2023 remained 5.4% below 2019 pre-pandemic levels, the WTTC projected a turnaround, forecasting that business travel spend would rise to 6.2% above its previous high in 2024.

The GBTA, which reported similar overall growth figures, noted that part of the increase in spending could be attributed to inflation. When adjusted for real terms, total spending is expected to remain slightly below 2019 levels, according to the GBTA. Nevertheless, these gains highlight the resilience of business travel and the enduring importance of face-to-face meetings.

Regionally, the GBTA estimated that real-term spending has surpassed 2019 levels in North America, the Middle East, and Latin America. Meanwhile, Western Europe reached 94% of pre-pandemic levels, and Asia-Pacific climbed to 89%. 

These figures underscore business travel's enduring importance to international commerce and its steady return across global markets.

6. The power of travel and hospitality influencers grows

As highlighted earlier, the Balkans hosted some of Europe’s best-performing hotel markets in 2024, though Albania stood out as a notable exception. 

In 2023, average hotel room prices in Albania surged by 27% to 41% year-on-year (YoY) during the peak summer months of May through August. However, in 2024, those gains were partially reversed, with rates falling 5% to 19% during those four months YoY.

Despite an increase in official tourism numbers and nights spent, many resorts, particularly in southern Albania, struggled with spare capacity. 

This trend highlights the growing impact of social media influencers, who are now powerful drivers of demand and can significantly influence entire markets.

Albania experienced a surge in popularity in 2022 and early 2023, propelled by influential social media figures, especially on TikTok, which helped position it as one of the world’s hottest destinations.

However, as the hype shifted to new locations, some of the challenges associated with traveling in a country with limited infrastructure and modest incomes became more evident.

Social media influencers have become, in many cases, more effective marketing tools than traditional brand-only campaigns, particularly in the travel sector, where they wield immense influence at the top of the sales funnel. 

A 2023 multi-country study by American Express found that three-quarters of respondents drew inspiration for travel destinations from social media. 

Social media now represents a powerful direct route-to-market for hotel brands. According to Skift, 34% of travelers report feeling “very comfortable” making bookings directly on platforms like Instagram, Facebook, and YouTube.

This shift in consumer behavior highlights the growing need for hoteliers to maintain a robust social media presence to effectively compete for and connect with today's digitally-savvy travelers.

7. AI makes inroads in both consumer and industry fields

The hospitality and travel industries faced an ever-growing challenge in 2024: managing and making sense of vast amounts of information and data. This complexity accelerated AI adoption across the sector, transforming both business operations and consumer behavior.

For consumers, algorithm-driven searches and feeds have long been the norm, but they are now turning more frequently to tools like Large Language Models (LLMs) for inspiration, itinerary creation, and in-destination recommendations. 

According to a survey by Oliver Wyman, the use of AI during the inspiration and planning phases among North American consumers rose by 7% between August 2023 and March 2024, reaching 41%.

Curating information into more bitesize formats is not just for consumers, as AI is also proving to be a critical aid in deciphering complex, rapidly changing markets. 

Lighthouse research reveals AI has become essential for hoteliers, driven by increasing market complexity. Since 2019, hotels worldwide have increased their frequency of price changes by 20%, while the number of rate codes has surged by 130%.

Our survey found that 63% of hotels now use AI in some form for revenue management. However, adoption remains uneven - 45% of independent hotels report no AI usage at all. Even among those using AI, applications tend to be narrow in scope, with data analytics being the most common use case, yet implemented by only a third of respondents.

The potential for AI expansion remains significant. While many hotels have begun adopting the technology, 45% of independent properties report no AI usage at all.

Even among adopters, implementation tends to be narrow - data analytics leads as the most common application, yet only a third of hotels report using AI for this purpose.

8. The short-term rental backlash remained

Major tourism destinations worldwide intensified their pushback against short-term rentals throughout 2024, with regulatory action accelerating toward year's end.

These have taken multiple forms as well. In Italy, national regulators have looked to put an end to self check-ins with a ban on key lock boxes. In Paris regulators are enhancing enforcement efforts and setting limits on the number of nights properties can be rented out. 

At the more extreme end of the spectrum, Dubrovnik, Lisbon and Barcelona have or are discussing outright bans on rentals, motivated by spiraling rents and local discontent. 

Momentum is building for stricter oversight of the sector, as more destinations move to regulate short-term rentals. However, since this regulatory shift is still in its early stages, its full impact on the market remains to be seen.

Barcelona, often seen as the leading example of short-term rental regulation, offers mixed evidence of policy effectiveness. While total rental capacity has grown 34% from its pandemic low in December 2021, the current maximum of 76,000 guests remains 11% below 2019 levels.. 

The gap between official records and market reality suggests regulations may be falling short of their intended impact. Despite the city reporting only 10,000 registered properties, our data shows 21,000 listings available online - indicating many owners continue to operate without proper registration.

While destinations like Barcelona have implemented strict measures to curb short-term rentals, the broader global market continues to thrive. In many other locations, the short-term rental sector remains robust, offering growth opportunities. 

However, property owners and managers should exercise caution and stay informed about evolving regulations, as enforcement efforts and legislation may intensify in the coming years.

Key takeaways for hospitality professionals

The travel and hospitality landscape in 2024 was shaped by economic pressures, evolving consumer behavior, and technological advancement.

Success in 2025 and beyond will depend on how well businesses adapt to these shifting market dynamics. To help you adapt to these changes, here are key strategies to implement.

Actionable strategies

1. Optimize your pricing for value: If this segment fits with your property, you can appeal to cost-conscious travelers with value-driven offers like bundles and special promotions. But, don’t leave it to chance, use a rate shopping tool to guide your pricing.

2. Emerging destinations: If your property is located in an emerging destination, focus your marketing efforts on adventurous travelers seeking affordable, off-the-beaten-path experiences.

3. Adopt AI tools: Use AI to automate dynamic room pricing across all of your connected distribution channels to simultaneously save time and boost revenue. 

4. Tailor to regional trends: Adjust strategies based on local market conditions, using predictive demand intelligence.

5. Harness social media: Boost your social presence and ensure seamless booking via social platforms to attract modern travelers.

6. Tap into business travel: Capture the growing corporate market with tailored packages.

7. Be aware of regulatory shifts: If you’re a short-term rental property owner, make sure to keep your eye on local and government regulations. 

The hospitality industry continues to evolve, offering abundant opportunities for those who adapt effectively. Success in this competitive landscape depends on maintaining operational agility, implementing strategic technology solutions, and responding to changing traveler needs.

Watch for our upcoming analysis of key developments and trends we anticipate you will need to be aware of in 2025 to stay ahead of the curve.