The Future of 2026 Brand Growth Strategies

Listen to the article 17 min This audio is auto-generated. Please let us understand if you have feedback. Following a year of broad financial uncertainty that stifled development for hotels, hospitality industry leaders are looking toward 2026 with mindful optimism. Rising functional expenses are slated to challenge owners this year and lower-tier sections might struggle in the middle of a growing wealth bifurcation.

And through everything, hotel business are anticipated to strengthen their portfolios with brand-new brand offerings and partnerships. As the year gets underway, Hotel Dive consulted with hospitality leaders from varying corners of the market about their 2026 forecasts. Below are the leading trends expected to effect hotel operations, performance, net unit growth and more this year.

Total salaries, salaries and advantages paid by U.S. hotels rose to $127 billion in 2025, according to data from the American Hotel & Lodging Association, shown Hotel Dive. In 2026, that figure is forecasted to climb up to $131 billion, representing an approximately 3% year-over-year increase, per AHLA. For hotel owners, increasing labor costs posture a difficulty to net operating income development, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, informed Hotel Dive.

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Increasing labor expenses have been a difficulty for hoteliers for years, Davis stated, especially following the COVID-19 pandemic. Overall, hotel labor costs have actually increased 15.3% from 2019 to 2025, outmatching the 12.8% growth in total operating profits, according to AHLA.

3, 2024 in San Francisco, California. Justin Sullivan by means of Getty Images In 2026, Davis noted, union negotiations will be "front and center" in New York City, where the New York City Hotel and Gaming Trades Council's union agreement with the Hotel Association of New York City City is set to end in July.

"Demand has not kept up with this speed," she stated. "We're also seeing these challenges intensified by legislation that targets hotel operations, such as severe labor and licensing policies like the New York City City Safe Hotels Act. When need is falling and costs are skyrocketing, the math just does not accumulate." Wages, wages and payroll-related expenditures paid by hotels now account for more than 32% of total revenue, according to AHLA.

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As more hotel guests turn to expert system to boost their travel experience, reserving hotels straight through large language models (LLMs) might be next, hospitality experts said. Agentic commerce a procedure by which autonomous AI agents act on behalf of a customer to find, compare and finish purchases is a pattern that has accelerated across markets like retail.

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According to PwC's 2025 Holiday Outlook report, 76% of millennials said they're most likely to utilize AI for travel suggestions. A smaller sized portion (57%) said they 'd be likely to utilize it for booking travel. But that number is growing, Jonathan Kletzel, PwC's travel, transportation and logistics leader, told Hotel Dive. "The variety of consumers that are searching [through LLMs] for product or services in travel has ballooned in the last 12 months and is accelerating every day," Kletzel said, adding that undoubtedly, hotels will "take a tough take a look at how they can allow commerce and deals through agentic [AI]"" [Brands] can develop on the trust they currently have if they do a great task with how they manage AI in 2026." Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To stay competitive with direct booking, bigger multibrand hotel companies will "embed LLMs into their own brand name sites and mobile apps, and change the way the customer searches," Kletzel stated.

"If you are not discoverable in an LLM search results page which numerous brands aren't, and this is the big panic that they're all going through right now consumers aren't going to consider you," he stated. Michael Klein, head of retail, travel and hospitality item marketing at AI consumer experience platform Talkdesk, similarly told Hotel Dive that hospitality gamers need to guarantee their property info is being indexed by LLMs to appear in traveler queries.