Hotel Market Research

Hotel Market Research

Hotel market research plays a critical role in the decision-making process of companies in the hospitality industry. Consequently, consulting firms conduct this type of research to analyze consumer behaviors and patterns to forecast future trends and enable businesses to perform customized strategies for their market.

As a result, hotel market research is a valuable source of information on consumer trends and the overall competitive landscape since the research findings and insights provide useful information for strategic marketing and operational decisions.

Benefits of hotel market research

Conducting thorough hotel market research demands an in-depth analysis of the competition at the local and global markets as well as opportunities and challenges.

Some of the key benefits of hotel market research are:

  • Hotel market research supports companies to identify and understand their target market by gathering in-depth data on consumer demographics, behavioral preferences, and purchasing behavior.
  • It allows companies in the hospitality industry to customize their existing products and services to more effectively address the unique requirements of their target audiences.
  • It may result in higher customer satisfaction and increased revenues because of an accurate strategy based on the research findings.
  • The research enables companies to spot opportunities and threats in the hotel market, monitoring market trends and the competitive landscape, emerging competitors, changes in consumer behavior, and potential business differentiators.
  • Ability to mitigate risks by assessing the feasibility of a particular hotel project with a deep understanding of factors such as competition and current market demand.

Importance of hotel market research

Hotel market research provides consulting firms and their clients in the hospitality industry with the key information and data to accurately assess the potential viability of hotel development ventures

It enables clients to develop a business plan and estimate potential turnover. Likewise, it helps clients to pinpoint a change in trends in the market, stay ahead of their competitors, and future trends in the industry.

Conducting thorough hotel market research also equips consulting firms with the data to make informed recommendations to their clients and mitigate risks. It minimizes the risk of financial loss and guarantees investments are driven to potentially successful projects in the target market.

Additionally, by gathering detailed information on consumers’ demographics, preferences and purchasing behavior, consulting firms tailor their products and services to better meet the needs of their target audiences and help them gain a competitive advantage in highly competitive marketplaces.

Main segments in hotel market research

Hotel market research is often categorized into various segments based on the nature of the hotel such as:

  • Luxury hotels: High-end hotels featuring a comprehensive range of luxury amenities and services are covered in this segment. The research focused on this niche involves understanding consumer preferences and spending habits to customize the offering to their expectations.
  • Extended stay hotels: This target market comprises hotels that serve guests seeking to stay for an extended period of time such as business travelers or digital nomads. Hotel market research in this segment concentrates on target market demographics and the overall economic landscape to determine the demand for hotel rooms.
  • Budget hotels: This sector encompasses hotels that target price-sensitive consumers and deliver basic services at affordable prices. Research in this segment focuses on reducing costs to offer services for travelers with limited budgets.
  • Boutique hotels: The boutique hotel segment covers hotels that offer a unique and tailored experience to customers. Hotel market research for this segment concentrates on understanding the potential demands of future customers and their demographics to foresee their unmet needs.
  • Vacation rentals: This niche segment includes privately owned rentals such as Airbnb. The research in this segment focuses on gaining an in-depth understanding of consumer preferences in a wide market with an extended offering.

It is noteworthy that the segments considered in hotel market research are not necessarily exclusive and several hotel chains belong to various segments. It makes the research more complex and depending on the scope, the study should focus on analyzing one or more of these segments.

Some additional examples of segments in hotel market research might include eco-hotels, resorts, casinos, etc. However, segmentation must be based on the client’s specific needs and the scope of the research following the same protocols as the main segments.

Challenges and opportunities

The industry is not only becoming increasingly competitive, but it is also a sector in an ever-changing environment. This is due mainly to the constantly evolving behaviors, perceptions, expectations, and purchasing decisions of travelers. It creates numerous opportunities and challenges for consulting firms conducting research and businesses developing strategies.


  • Data collection is complex and information rapidly varies: Collecting reliable and consistent data is considered one of the most challenging aspects of hotel market research. It is often complicated because of the dynamic nature of the hotel sector, which is continually changing in response to consumer preference shifts, emerging technologies, and economic conditions. In addition, Covid-19 restrictions in the last few years created new challenges to hotel market research that should now also analyze the risks of new outbreaks of Covid-19, or consider the risks of a new global pandemic.
  • The high volume of data to analyze: Analyzing and interpreting the data collected is an additional challenge. Data collection and analysis involve extensive data from numerous sources that increase the complexity of the research and make it difficult to draw meaningful insights and conclusions.
  • Keeping abreast of industry trends: Hotel operations are rapidly evolving and it is difficult to keep track of the latest trends and developments in the hospitality industry.


  • Technology advances: Technological breakthroughs have made it easier and more affordable to gather and analyze data. It has the potential to address some of the challenges of hotel market research.
  • Massive data analysis tools: The wider availability of AI solutions will lead to more accurate and timely information on consumer behavior and market trends. It has the capacity of collecting enormous amounts of data and provide valuable insights in minutes.
  • Predictive analytics: Emerging technologies allow forecasting analytics to predict future trends and patterns in the market to prepare accurate marketing strategies and future product developments.

SIS International offers Quantitative, Qualitative, and Strategy Research. We provide data, tools, strategies, reports and insights for decision-making. We conduct interviews, surveys, focus groups and many other Market Research methods and approaches. Contact us for your next Market Research project.

Contact us for your next Market Research Project.

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