The American Hotel and Lodging Association’s 2025 State of the Industry report has revealed key insights about evolving travel trends. One such finding regards younger generations’ spending habits. Millennials and Gen Z are playing a crucial role in the hotel industry’s recovery, having spent twice as much on lodging in 2023 as in 2019. These demographics also report placing higher value on travel experiences than previous generations.

The American Express 2023 Global Travel Trends report supports these findings, showing that 84% of Gen Z and millennial respondents would prioritize a dream vacation over purchasing a luxury item. Additionally, 86% express a desire to support small businesses during their travels.

With these shifting priorities, the hospitality industry faces an important question: How can we they  effectively target these demographics?

Hospitality sales and marketing expert HSMAI Americas suggests several strategic approaches:

  • Focus on experiential marketing: The 2025 AHLA State of the Industry report highlights how major players are adapting. One hotel chain is expanding into camping accommodations while another is emphasizing gaming and entertainment. A global hotel brand has made significant investments in experiential travel, aligning with consumers’ increasing preference for personalized, meaningful experiences.
  • Leverage user-generated content and fear of missing out (FOMO): Social media’s influence is particularly strong among Gen Z, with over 94% active on various platforms. Hotels can capitalize on this by encouraging guests to share their experiences, organizing photo contests and partnering with influencers. The impact is significant: 70% of U.S. respondents follow influencers, with one-third reporting that these personalities influence their purchasing decisions- rising to over 50% for Gen Z and millennials.
  • Embrace niche and passion-based travel: Younger travelers increasingly plan their trips around specific experiences and events rather than destinations. Hotels can adapt by tailoring their offerings to complement local attractions. Washington state’s diverse calendar of anime events, music festivals, circus events, comedy shows and seafood festivals provide numerous opportunities for strategic alignment.

The transformation in travel preferences among millennials and Gen Z presents both challenges and opportunities for the hospitality industry. Success in this market requires hotels to shift from traditional service models toward more experiential, socially connected and personally meaningful offers. By embracing these changes and implementing targeted strategies, hotels can build lasting relationships with these value-driven generations while securing their position in the future of travel.

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