2021
9
UK Hotels Market Report 2021
2022-02-08T03:01:24+00:00
OX1049105
2195
147775
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Report
en_GB
“COVID-19 has boosted demand for holiday rental properties and camping holidays, while suppressing demand for business travel. As such, hotels are challenged to strengthen their position in the market such…

UK Hotels Market Report 2021

£ 2,195 (Excl.Tax)

Description

The UK Hotels market research report identifies consumer attitudes towards the hotel industry, hotel usage, domestic and inbound markets, and consumer perceptions in the UK. This market report covers the hotels market size, market forecast, market segmentation and industry trends for the Hotels market in the UK.

Current Market Landscape

Consumers are becoming increasingly observant of the external factors that affect their mental and physical wellbeing. 27% of Brits who stayed or plan to stay in a hotel in the UK would be interested in a hotel room specifically designed to enhance sleep quality. Hotels that focus on improving guest wellbeing, such as offering rooms that stimulate relaxation, providing food and drink with health benefits and giving access to wellness facilities, can strengthen their appeal over other forms of accommodation.

Domestic leisure demand is expected to recover fastest as more Brits will holiday in the UK amid lingering uncertainty over international travel. However, business travel will recover slower as some companies will continue to use alternative ways of meeting to save costs, work efficiently and reduce carbon emissions.

Future Market Trends in Hotels 

COVID-19 uncertainty and travel restrictions continue to pose a big threat to the recovery of the UK hotel market, particularly that of inbound travel. On top of that, debts caused by the pandemic and increased staff costs, inflationary pressures and the upcoming end of the reduced VAT rate increase the pressure on hotels to reduce their operational costs and find more creative ways to increase revenue.

COVID-19 has led to a greater appreciation of local brands. As such, independent hotels can benefit by promoting their individuality and local identity, while international brands will need to ramp up their localisation strategies. Hotels also play a crucial role in connecting guests with local experiences.

Read on to discover more details or take a look at all of our UK Holidays and Travel market research.

Quickly understand

  • The impact of COVID-19 on the UK hotel industry – including domestic and inbound markets.
  • Hotel usage by consumers in the UK.
  • Reasons for booking directly with the hotel vs online through a third party.
  • Consumers’ intentions to stay in UK hotels, by purpose and type of hotel.
  • Interest in products and services and decisive factors when choosing a hotel.
  • Consumer perceptions of leading hotel brands versus Airbnb.

Covered in this report

Brands: Premier Inn, Travelodge, InterContinental Hotels Group, Best Western, Accor, Hilton, Marriott International, Wyndham Hotel Group, Britannia, Airbnb, Best Western.

Expert analysis from a specialist in the field

This report, written by Marloes de Vries, a leading analyst in the Travel sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

COVID-19 has boosted demand for holiday rental properties and camping holidays, while suppressing demand for business travel. As such, hotels are challenged to strengthen their position in the market such as through introducing more concepts which bring together the uniqueness and self-catering aspect of holiday rentals with the facilities and service levels of hotels. This should include developing more nature-focused properties and enhancing wellness offerings.

Marloes de Vries
Associate Director – Travel

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • COVID-19: market context
    • Economic and other assumptions
    • Products covered in this Report
  2. Executive Summary

    • Impact of COVID-19 on the UK hotel market
      • Figure 1: Short, medium and long-term impact of COVID-19 on the UK hotel market, 2020-25
    • The market
    • Volume of the UK hotel market not expected to fully recover in the forecast period
      • Figure 2: COVID-19 scenario forecasts for the volume of hotel/motel/guesthouse trips (domestic and inbound), 2016-26
    • Value of the UK hotel market will recover ahead of volume, but not until 2026
      • Figure 3: COVID-19 scenario forecasts for the value of hotel/motel/guesthouse trips (domestic and inbound), 2016-26
    • Polarisation will boost popularity of both low-cost options and holiday upgrades
    • Staff shortage will further fuel the need for automation
    • Companies and brands
    • room2 opens fully net-zero hometel in London
    • Fairmont hotel’s focus on personalised wellbeing
    • Porsche Design and Steigenberger have created a joint hotel brand
    • The consumer
    • Chains almost twice as popular as independents
      • Figure 4: Usage of overnight accommodation in the UK in the past three years, 2020-21
    • Even split between direct and third-party bookings
      • Figure 5: Booking methods used for last hotel stay, 2021
    • Getting a fast booking process is a motivator for over one in four direct bookers
      • Figure 6: Reasons for booking the last hotel stay directly, 2021
    • Third-party channels benefit from offering a wide choice of options
      • Figure 7: Reasons for booking the last hotel stay through a third party, 2021
    • Visits to friends and family second most important purpose for future hotel stays
    • Sustainable practices will play an important role in the recovery process of business travel
      • Figure 8: Purpose of UK hotel stays in the next 12 months, 2021
    • Alternative ways of generating revenue in a highly price-sensitive environment
      • Figure 9: Decisive factors when choosing a hotel, 2021
    • Hotels play a crucial role in helping travellers to connect with the local surroundings
      • Figure 10: Interest in products and services when staying in UK hotels, 2021
  3. Issues and Insights

    • COVID-19 has boosted demand for holiday rental property and camping holidays
    • Uniqueness and self-catering services to compete with holiday rental properties
    • Focus on nature to compete with camping and caravanning segment
    • Enhancing wellness offering could strengthen hotels’ position in the market
    • Alternative ways of generating revenue in a highly price-sensitive environment
    • Charging for the use of extra amenities and services
    • Promoting day experiences
    • Tapping into the increased popularity of food takeaways and home delivery
    • Commercialising items in the hotel
  4. Market Size and Performance

    • Domestic travel will continue to lead the recovery in 2022
      • Figure 11: Short, medium and long-term impact of COVID-19 on the UK hotel market, 2020-25
    • COVID-19 hits after UK hotel market reaches record heights
      • Figure 12: Total volume and value of UK hotel/motel/guesthouse stays, 2015-21
    • 2021 saw a further decline in inbound guests…
    • …and an improvement in the number of domestic hotel guests
      • Figure 13: Volume and nights of domestic stays in a hotel/motel/guesthouse in Great Britain, and volume and nights of inbound stays in a hotel/guesthouse in the UK, 2015-21
      • Figure 14: Hotel performance measurements, London and UK regions, 2019-22
  5. Market Forecast

    • Volume of the UK hotel market not expected to fully recover in the forecast period
      • Figure 15: Total volume forecast of hotel/motel/guesthouse trips (domestic and inbound), 2016-26
    • Value of the UK hotel market will recover ahead of volume, but not until 2026
      • Figure 16: Total value forecast of hotel/motel/guesthouse nights (domestic and inbound), 2016-26
    • Market drivers and assumptions
      • Figure 17: Key drivers affecting Mintel’s market forecast, 2015-26
    • Forecast methodology
  6. COVID-19 Scenario Performance

    • Mintel’s approach to predicting the impact of COVID-19
    • Fundamental differences in how COVID-19 is affecting consumer markets
    • Impact of the COVID scenarios on the UK hotel market
    • COVID scenarios have the biggest impact on the inbound segment
      • Figure 18: COVID-19 scenario forecasts for the volume of hotel/motel/guesthouse trips (domestic and inbound), 2016-26
      • Figure 19: COVID-19 scenario forecasts for the value of hotel/motel/guesthouse trips (domestic and inbound), 2016-26
  7. Market Drivers

    • Booking levels remained stable, but Omicron led to cancellations
      • Figure 20: Holiday bookings in the last three months, 2019 vs 2021
    • Consumers become more resilient as they learn to live with the virus…
    • …while the lifting of Plan B regulations will help travel companies to capitalise on pent-up demand
      • Figure 21: Plans to book a holiday in the next three months, 2019 vs 2021
    • Consumer confidence in their financial situation exceeds pre-pandemic levels…
    • …but the pandemic intensified polarisation
    • …while concerns over inflation are coming to the fore
      • Figure 22: The Financial Confidence Index, 2015-21
    • Staff shortage will further fuel the need for automation
      • Figure 23: Reasons for looking for a new job in the next 12 months, 2021
    • Increasing demand for pet-friendly accommodation and services
    • Hotels continue to adapt to the new way of working
  8. Market Share

    • Regional hotels benefited from summer staycation boost
      • Figure 24: Leading hotel operators in the UK, by estimated UK site numbers, January 2022
    • Best Western reports significant disruption following Omicron
    • Marriott is recruiting TikTok Correspondents
    • Accor launches new luxury brand designed for independent hoteliers
  9. Launch Activity and Innovation

    • Sustainable initiatives in the hotel industry
    • room2 opens fully net-zero hometel in London
    • Radisson Hotel Group offers carbon-negative meetings
    • Improving the planning and booking experience for groups
    • Hilton introduces option to book and instantly confirm connecting rooms globally
    • Premier Inn creates tool for groups to determine the ideal location to meet in the middle
    • IHG deploys online direct booking technology for groups
    • Technological innovations throughout the customer journey
    • The Pavilions Hotels and Resorts adds crypto payment method for direct bookings
    • Sofitel En Voyage Pod’s prototype created to experience a new way of travelling through the city
    • Accor rolls out keyless entry globally for contact-light travel experiences
    • A selection of new and upcoming hotel openings
    • Fairmont hotel’s focus on personalised wellbeing
    • Porsche Design and Steigenberger have created a joint hotel brand
  10. Brand Research

    • Brand map
      • Figure 25: Attitudes towards and usage of selected brands, 2021
    • Key brand metrics
      • Figure 26: Key metrics for selected brands, 2021
    • Brand attitudes: Hilton and Marriott are seen as worth paying a premium for
      • Figure 27: Attitudes, by brand, 2021
    • Brand personality: Airbnb seen as innovative but not always ethical
      • Figure 28: Brand personality – Macro image, 2021
    • Premier Inn and Holiday Inn are closely associated with being reliable
      • Figure 29: Brand personality – Micro image, 2021
    • Brand analysis
    • Premier Inn
    • Travelodge
    • Hilton
    • Marriott
    • Holiday Inn
    • Best Western
    • Airbnb
    • Older generation remains cautious among continued presence of the virus
      • Figure 30: Demographic profile of users, 2021
  11. Hotel Stays – Participation

    • Chains almost twice as popular as independents
    • COVID-19 has fuelled the localism trend
      • Figure 31: Usage of overnight accommodation in the UK in the past three years, 2020-21
    • Holiday rental property segment outperformed the hotel sector
    • Camping and caravanning expected to have exceeded pre-pandemic levels
      • Figure 32: Use of hotels, rental properties and other accommodation in the past three years, 2020-21
  12. Booking Method

    • Even split between direct and third-party bookings
      • Figure 33: Booking methods used for last hotel stay, 2021
    • Direct bookers skew towards older demographics
    • Indirect bookers skew towards younger and affluent audiences
      • Figure 34: Demographic profile of direct vs indirect bookers, 2021
  13. Reasons for Booking Directly vs Through a Third Party

    • Getting a fast booking process is a motivator for over one in four direct bookers
      • Figure 35: Reasons for booking the last hotel stay directly, 2021
    • Third-party channels benefit from offering a wide choice of options
    • Filters that help to show unique hotels and wellness facilities appeal to indirect bookers
      • Figure 36: Reasons for booking the last hotel stay through a third party, 2021
  14. Hotel Stays – Future Intentions

    • Luxury accommodation will benefit from lockdown savings…
    • …but increased polarisation will also favour budget accommodation
      • Figure 37: Intentions to stay in a UK hotel in the next 12 months, by type of hotel, 2021
    • Visits to friends and family second most important purpose for future hotel stays
    • Sustainable practices will play an important role in the recovery process of business travel
      • Figure 38: Purpose of UK hotel stays in the next 12 months, 2021
  15. Decisive Factors when Choosing a Hotel

    • Alternative ways of generating revenue in a highly price-sensitive environment
    • Charging for the use of extra amenities and services
    • Promoting day experiences
    • Tapping into the increased popularity of food takeaways and home delivery
    • Commercialising items in the hotel
      • Figure 39: Decisive factors when choosing a hotel, 2021
    • Unique style and late check-out can broaden the appeal of hotels
      • Figure 40: Decisive factors when choosing a hotel – TURF Analysis, 2021
  16. Interest in Products and Services

    • Hotels play a crucial role in helping travellers to connect with the local surroundings
      • Figure 41: Interest in products and services when staying in UK hotels, 2021
    • Consumer appetite for hotel rooms aimed at improving sleep
    • Consumer expectations of corporate ethics will become stronger
  17. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Consumer research methodology
    • TURF analysis methodology
      • Figure 42: Decisive factors when choosing a hotel – TURF analysis table output, 2021
  18. Appendix – Forecast Methodology

    • Volume forecast and prediction intervals for hotel/motel/guesthouse trips
      • Figure 43: Lower bound, central and upper bound forecast for volume of hotel/motel/guesthouse trips (domestic and inbound), 2021-26
    • Value forecast and prediction intervals for hotel/motel/guesthouse trips
      • Figure 44: Lower bound, central and upper bound forecast for value of hotel/motel/guesthouse trips (domestic and inbound), 2021-26
    • Value forecast and prediction intervals for hotel/motel/guesthouse trips at constant prices
      • Figure 45: value of hotel/motel/guesthouse trips (domestic and inbound) at 2021 prices, 2021-26
    • Market drivers and assumptions
      • Figure 46: Key drivers affecting Mintel’s market forecast, 2020-26
    • Forecast methodology
  19. Appendix – COVID Scenario Performance Methodology and Assumptions

    • Volume scenario performance for hotel/motel/guesthouse trips
      • Figure 47: COVID-19 scenario forecasts for the volume of hotel/motel/guesthouse trips (domestic and inbound), 2016-26
    • Value scenario performance for hotel/motel/guesthouse trips
      • Figure 48: COVID-19 scenario forecasts for the value of hotel/motel/guesthouse trips (domestic and inbound), 2016-26
    • Rapid COVID recovery, central and extended COVID disruption scenarios outline
    • Scenario methodology

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

Market

Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.

Consumer

Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.

Brand/Company

Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

Market reports provide appendices of data to support the research and insight produced. Our databooks* are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.

*databooks not available with UK B2B Industry reports.

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