The luxury hotel market - France

The global luxury hotel market faced a significant downturn in 2020 due to the pandemic, with a sharp decline in occupancy rates, average room prices, and revenue per available room (REVPAR), notably impacting the high-end segment which saw a decrease in REVPAR by 73.7%. Despite this, the market was valued at $174.9 billion in 2020 and is expected to grow at a compound annual growth rate of 4% through 2026. North America is recognized as the most dynamic market within this sector.

The luxury hotel sector, driven by tourism development and higher living standards, has had to address the challenges of the technological environment by building more direct relationships with customers through social media platforms. In France, 5-star hotels have been particularly affected with a 51.4% revenue drop in 2020, suffering more than the wider French hotel industry due to the absence of international clients and events. Five-star establishments represented 14.3% of the total hotel revenues in France in 2020. Luxury hotels continue to remain a key part of the hospitality industry, appealing mainly to leisure clients, with a significant decrease in business clientele during the crisis.

Understanding the Demand Trends in the French Luxury Hotel Market

In France, the luxury hotel market exhibits certain trends and characteristics that shape the demand. Catering to a mere 9% of hotels in the provinces and 11% in mainland France, luxury hotels, particularly those rated at four and five stars, play a significant role in the regional hospitality landscape. An interesting aspect is that about a quarter of foreign tourists opt for luxury accommodations, with a majority preferring chain hotels over independent ones. The demand for luxury hotels in France can be dichotomized into two main categories, namely, business and leisure clientele.

Business clientele consists of a diverse group, ranging from executives and sales representatives to technicians and workers, with varied lengths of stay. These are further segmented into groups like full-fare business travelers, those with agency or corporate rates, and individuals enjoying special prices due to events. The leisure side sees individuals traveling for personal reasons, with distinctions among full-fare travelers, those with agency-discounted trips, and beneficiaries of special events or last-minute rates. A notable trend is the predominance of leisure customers in five-star hotels and those with the Palace distinction awarded by Atout France. In 2020, leisure clients constituted the majority at Palaces, significantly higher compared to a diminished business clientele that represented between 10% and 15% of all Palace guests.

The luxury hotel market saw a shift with the emergence of the health crisis in 2020. This downturn disproportionally affected the high-end segments dependent on international tourism, conventions, and trade shows. However, despite such challenges, the revenue per available room in the upper tier remains above the French hotel industry average, signifying resilience amid adversity. With the majority of high-end and luxury establishments choosing closure in the lack of business during the critical months of the crisis, the luxury market demonstrated its vulnerability to global events that stifle international travel and large gatherings. The anticipated trend for luxury hotels is a revival as travel restrictions ease and consumer confidence returns, but the demand composition might evolve based on emerging travel patterns and the economic aftermath of the pandemic on both corporate and leisure sectors.

Pinnacle of Prestige: Deciphering the Titans of the Luxury Hotel Industry

The luxury hotel market is a realm of exceptional service, unparalleled comfort, and unforgettable experiences, where titans of hospitality set the benchmark for indulgence and exclusivity. The most prominent players in this elite circle have created dynasties that span the globe, offering the discerning traveler a passport to opulence and pampering in the world's most coveted destinations.

• Westin Hotels & Resorts: Pillars of Well-being Westin Hotels & Resorts represents a sanctuary of health and rejuvenation within the luxury hotel segment. Their commitment to guests' well-being is showcased through signature offerings like the Heavenly Bed® for a restful sleep and rejuvenating spa treatments that embody their philosophy of empowering guests' well-being.

• St Regis Hotels & Resorts: The Epitome of Timeless Elegance St Regis Hotels & Resorts are legends in the luxury hotel sector, providing experiences that go beyond expectations. Known for their bespoke service and refined opulence, St. Regis properties around the world offer guests the chance to enjoy iconic rituals such as the evening sabering of champagne, which encapsulate their tradition of grace and grandeur.

• Leading Hotels of the World: A Collection of Unrivaled Distinction As an umbrella organization, Leading Hotels of the World curates a selection of the world's most magnificent independent hotels. Each property is distinctive, with its own identity rooted in its locale, providing travelers with authentic and immersive experiences that cannot be replicated.

• Waldorf Astoria: The Legacy of Signature Luxury Waldorf Astoria has set standards in the hospitality industry for over a century, standing as beacons of timeless glamour. Iconic in every sense of the word, the Waldorf Astoria collection promises guests a journey steeped in luxury and a storied heritage that's meticulously preserved. Personal concierges ensure that every stay is as extraordinary as the hotel's illustrious history.

• Fairmont Hotels & Resorts: Environmentally Conscious Opulence with a heart for sustainability and a passion for outstanding service, Fairmont Hotels & Resorts blends eco-friendly practices with luxury. Their locations, often in buildings of historical significance, offer a perfect blend of modern conveniences and environmental consciousness without compromising on the indulgent experiences sought by guests. Each of these esteemed institutions has masterfully positioned themselves as more than just places to stay—they are destinations in their own right, delivering grandeur, well-being, and culture to every guest who crosses their thresholds. 

Inforamtion

• Number of pages : 30 pages
• Format : Digital and PDF versions
• Last update : 21/12/2022

Summary and extracts

List of charts

• World luxury hotel market
• Revenues of 5-star hotels
• Répartition du chiffre d'affaires
• Contribution des centres de profit à la marge globale
• Typology of the Palaces' clientele
• Occupancy rate of French Palaces
• Visits to 5-star hotels
• Origin of the customers of the Palaces
• Average price of the Palaces
• Change in performance and prices of luxury hotels (excluding Palaces)
• Regional distribution of French Palaces
• Regional distribution of rooms in French Palaces
• Distribution channels for hotel reservations
• Breakdown of the Palaces' revenues
• Breakdown of 5-star hotel revenues