Hotel Franchise Market Analysis

Hotel Franchise Market Analysis

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Based on chain value, the midscale segment dominated around USD 10 billion revenue in 2023, owing to rising preference for midscale hotels among a broad range of travelers, including budget-conscious individuals and families as they offer a balance between reasonable pricing and adequate amenities. In addition to providing comfortable stay with essential amenities, such as free Wi-Fi, breakfast, and parking, midscale hotels render good value for money for upscale accommodation. The surge in the number of leisure travelers and the subsequent need to cater to families seeking spacious rooms and family-friendly amenities will boost the segment growth.
 

Based on the hotel type, the extended stay segment held over 45% of the hotel franchise market share in 2023, due to growing suitability for professionals, such as consultants, contractors, and project-based workers. The rise of remote work and flexible work arrangements is driving the need for long-term business travel and accommodations to cater to individuals staying for extended periods. The rising instances of relocations requiring temporary housing solutions and the jump in corporate training programs and professional development initiatives will also augment the preference for extended-stay hotels.
 

North America hotel franchise market accounted for 35% of the revenue share in 2023, led by the growing penchant for alternative accommodation models, extended-stay options in the region. With growing emphasis on eco-friendly practices and sustainability, multiple hotel franchises are adopting green initiatives to reduce environmental impacts. The growing pool of health-conscious travelers is also leading to the higher integration of wellness and lifestyle amenities, such as gyms, spas, and healthy dining options in hotel franchises.
 

To illustrate, in October 2022, a popular at-home exercise equipment maker Peloton Interactive Inc. partnered with Hilton to feature its bikes across latter’s U.S. portfolio. The surging popularity of boutique and lifestyle hotel concepts to offer unique and localized experiences will also influence the market growth across North America.