Picture this: A digital nomad in the United States is looking for a place to stay in Barcelona. They need to keep costs in check and accommodations with good WiFi so they can work while traveling. To find it, they scroll through TikTok for the best neighborhoods to stay in the city and find Grà cia, a popular residential neighborhood. They decide to stay at an Airbnb and, upon arrival, find the following phrase written on the wall at the entrance: “Tourists, go home!”
Although hypothetical—but based on verisimilitude—this scenario outlines one of the prominent factors impacting hospitality today and, by extension, hotels: evolving booking patterns driven by AI and social media content and tourism backlash in high-traffic areas, as mass tourism strains life for local residents.
It’s just one trend put forth in Deloitte’s “The Future of Hospitality” report, along with more economic strains, including capital constraints, supply-chain disruptions and tariffs and ongoing labor-pool shrinkage.
To respond to these challenges, Deloitte presented six imperatives it believes can help hospitality providers stand out and succeed. HOTELS explored these in depth with insights from Matt Josephson, U.S. hospitality leader at Deloitte.
1. Demand capture through innovation and diversification
Gen Z, pet travelers or budget-conscious travelers are some of the niche customer segments that can be targeted with differentiated offerings through tools like AI-powered segmentation and dynamic pricing tiers or subscription-style payment options.
Thinking outside the box is what could get hotels ahead of the curve. Expanding into adjacencies, such as new locations, pre-and post-trip services and destination-led food and beverage, as well as testing new concepts without long-term investments through pop-up hotels or experiences, can be proving grounds for tailored offerings. Additionally, hospitality companies can partner with major cultural or sporting events to bundle accommodation with experiences like meet-and-greets with performing artists.
2. Activate AI-driven travel experiences
AI is everywhere in the conversation, but knowing where it actually delivers the fastest and most meaningful ROI for hospitality companies is crucial. “AI delivers value when it is embedded across both core operations and the guest journey, rather than as a standalone capability,” Josephson said. “Companies that are willing to explore opportunities across not only efficiency (where a lot of energy is focused today), but also experience and growth, are capitalizing faster. Further, leading companies are using AI to help reimagine their businesses rather than only optimizing what already exists. Examples of AI in action include predictive maintenance to prevent equipment failures; forecasting customer service demand; optimizing housekeeping routes and food purchasing; and using real-time data to adjust pricing, inventory and offers across channels.”
3. Unlock new growth markets
Deloitte advises hospitality companies to prioritize market expansion strategies that leverage demographic and socioeconomic shifts, new travel patterns and brand amplification. Tapping secondary cities for select service or micro-luxury concepts, encouraging guests to book regional travel “circuits” across multiple properties by offering bundles—like regional culinary tours or history and heritage trails—and investing in retail lines to “take the hotel home” are some ways to achieve this.
4. Achieve breakthrough efficiency by becoming a predictive enterprise
In any situation, predicting ahead of time is the solution. Of course, AI enables this possibly better than anything else. Realistically, breakthrough efficiency on hotels’ day-to-day operations is all about becoming a predictive enterprise, Josephson said. “It’s not just about automating what exists today, but about reimagining processes, experiences and products to operate more intelligently under changing conditions. On a day-to-day basis, this means using AI, automation and real-time data to anticipate operational issues, make smarter resource decisions and adapt quickly as expectations around staffing, compliance, and environmental performance continue to rise.”
5. Operate responsibly—it’s a core value
Transparently, legally, ethically. This trio of adverbs is how consumers, regulators and investors expect hospitality businesses to operate. From a sustainability perspective, the suggested strategy is designing environmentally resilient assets that incorporate greener materials and layouts; from a social perspective, is adopting universal design to help ensure people, of all ages and abilities, can fully enjoy leisure spaces; from a pricing perspective, committing to price transparency by using all-in pricing models that eliminate hidden fees and clearly disclose full costs is what demonstrates integrity.
6. Invest in the future-ready workforce
The skills required in the hotel industry continue to evolve, and AI plays a large part in that. “Because AI tends to be most beneficial when humans provide context, creativity and oversight, future-ready employees will need to be comfortable working alongside AI-enabled tools to support both guest-facing and operational roles,” Josephson said. Participating in digital apprenticeships that combine hospitality fundamentals with analytics, as well as AI augmented coaching and more flexible, technology-enabled workforce models, promises to support employees in their professional improvement. The intersection of human judgment and machine intelligence is likely to be best positioned for success.
Ultimately, while companies should consider these six forces holistically when thinking about how to grow and position their businesses for the long term, which one matters most “depends on a company’s business model, operating context and position in the market,” Josephson said. “That said, operational agility is becoming increasingly critical overall. As a result, companies that delay acting on advances in AI, data and automation risk falling behind early adopters in a capital-constrained, labor pressured environment.”
The future is now, and as it is shaped by new trends, new technologies and new travel habits, the industry “should find the right balance of pursuing the strategies that have worked versus trying new approaches, strategies, concepts and models,” concluded the report.