Hotel Franchise Market Size & Share 2024 - 2032
Market Size by Chain Value (Luxury, Upper-upscale, Upscale, Upper-midscale, Midscale, Economy), by Hotel Type (Extended Stay, Residence, Select Service), Growth Prospects, Regional Outlook & Forecast.
Report ID: GMI8027
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Published Date: February 2024
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Report Format: PDF
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Authors:
Preeti Wadhwani, Aishvarya Ambekar
Hotel Franchise Market Size
Hotel Franchise Market size was valued at USD 36.7 billion in 2023 and is estimated to register a CAGR of over 7.5% between 2024 and 2032, due to the rise in demand for unique and localized experiences. With changing traveler preferences, several hotel franchises are exploring boutique and lifestyle concepts to cater to guests seeking more personalized and distinctive stays. The strong focus on local culture, community engagement, and authentic experiences is also playing a significant role in shaping the industry growth.
Hotel Franchise Market Key Takeaways
Market Size & Growth
Key Market Drivers
Challenges
The emerging trend of sustainability is further compelling an increasing number of franchises to adopt eco-friendly practices, such as waste reduction initiatives, energy-efficient technologies, and environmentally friendly materials. To cite an instance, in April 2023, Marriott International reiterated its commitment to achieving sustainability certification for all its hotels as well as green building certifications for its 650 properties by 2025. This growing consumer preference for hotels committed to sustainable and responsible business practices will significantly contribute to the market growth.
The surge in the hotel franchise market is notably influenced by the expansion and diversification of luxury hotel offerings. A growing consumer appetite for premium travel experiences has propelled major players in the industry, such as Marriott, Hilton, and AccorHotels, to intensify their focus on luxury hotel franchises. This trend is not only reflective of an increasing demand for opulent accommodations but also underscores the strategic importance of catering to high-end clientele.
The rising emphasis on digital marketing strategies for accelerating direct bookings while reducing reliance on Online Travel Agencies (OTAs) for cost savings for hotel franchises will play a key role in the market expansion. Hotels are increasingly offering incentives, such as discounts, room upgrades, and loyalty program benefits, further motivating guests to choose the hotel's official channels over third-party platforms. However, intense competition from new market entrants and the shifting consumer preference for alternative accommodations like vacation rentals may limit the industry growth to some extent.
Hotel Franchise Market Trends
The escalating technology adoption for streamlining operations, enhancing guest experiences, and optimizing bookings is another emerging trend driving the market growth. Franchise hotels are increasingly deploying contactless check-in and check-out processes to allow guests to use mobile apps for keyless entry and transactions. The integration of smart room technology is urging guests to control various aspects of their room, such as lighting, temperature, and entertainment, through mobile apps and in-room devices.
The influx of AI-powered chatbots and virtual assistants is also automating customer service in handling inquiries, providing information about the hotel, and assisting with bookings. To cite an instance, in April 2023, Hilton deployed a new cloud-based hotel technology platform, Property Engagement Platform (PEP) for streamlining operations and addressing guest and team member needs.
Hotel Franchise Market Analysis
Based on chain value, the midscale segment dominated around USD 10 billion revenue in 2023, owing to rising preference for midscale hotels among a broad range of travelers, including budget-conscious individuals and families as they offer a balance between reasonable pricing and adequate amenities. In addition to providing comfortable stay with essential amenities, such as free Wi-Fi, breakfast, and parking, midscale hotels render good value for money for upscale accommodation. The surge in the number of leisure travelers and the subsequent need to cater to families seeking spacious rooms and family-friendly amenities will boost the segment growth.
Based on the hotel type, the extended stay segment held over 45% of the hotel franchise market share in 2023, due to growing suitability for professionals, such as consultants, contractors, and project-based workers. The rise of remote work and flexible work arrangements is driving the need for long-term business travel and accommodations to cater to individuals staying for extended periods. The rising instances of relocations requiring temporary housing solutions and the jump in corporate training programs and professional development initiatives will also augment the preference for extended-stay hotels.
North America hotel franchise market accounted for 35% of the revenue share in 2023, led by the growing penchant for alternative accommodation models, extended-stay options in the region. With growing emphasis on eco-friendly practices and sustainability, multiple hotel franchises are adopting green initiatives to reduce environmental impacts. The growing pool of health-conscious travelers is also leading to the higher integration of wellness and lifestyle amenities, such as gyms, spas, and healthy dining options in hotel franchises.
To illustrate, in October 2022, a popular at-home exercise equipment maker Peloton Interactive Inc. partnered with Hilton to feature its bikes across latter’s U.S. portfolio. The surging popularity of boutique and lifestyle hotel concepts to offer unique and localized experiences will also influence the market growth across North America.
Hotel Franchise Market Share
Marriott and Hilton hold a major market share of over 15% in the hotel franchise industry. Leading companies operating in the hotel franchise industry are constantly engaging in various growth-based strategies, including partnerships, investments initiatives and acquisitions to reinforce their market footprint. For instance, Accor, a major international hospitality group managing a variety of hotel brands in different segments, is developing a unique know-how in boosting hotel performance while vigorously working on accelerating its sustainable growth.
These industry giants are increasingly focusing on offering diverse brand portfolios, catering to various market segments ranging from luxury to budget accommodations. Marriott, for instance, has been actively promoting its Bonvoy loyalty program, providing guests with personalized experiences and exclusive perks, while Hilton has emphasized sustainability initiatives to align with the growing eco-consciousness of travelers.
Hotel Franchise Market Companies
Major companies operating in the hotel franchise industry are:
Hotel Franchise Industry News
The hotel franchise market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD Billion) from 2018 to 2032, for the following segments:
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Market, By Chain Value
Market, By Hotel Type
The above information has been provided for the following regions and countries:
Research methodology, data sources & validation process
This report draws on a structured research process built around direct industry conversations, proprietary modelling, and rigorous cross-validation and not just desk research.
Our 6-step research process
1. Research design & analyst oversight
At GMI, our research methodology is built on a foundation of human expertise, rigorous validation, and complete transparency. Every insight, trend analysis, and forecast in our reports is developed by experienced analysts who understand the nuances of your market.
Our approach integrates extensive primary research through direct engagement with industry participants and experts, complemented by comprehensive secondary research from verified global sources. We apply quantified impact analysis to deliver dependable forecasts, while maintaining complete traceability from original data sources to final insights.
2. Primary research
Primary research forms the backbone of our methodology, contributing nearly 80% to overall insights. It involves direct engagement with industry participants to ensure accuracy and depth in analysis. Our structured interview program covers regional and global markets, with inputs from C-suite executives, directors, and subject matter experts. These interactions provide strategic, operational, and technical perspectives, enabling well-rounded insights and reliable market forecasts.
3. Data mining & market analysis
Data mining is a key part of our research process, contributing nearly 20% to the overall methodology. It involves analysing market structure, identifying industry trends, and assessing macroeconomic factors through revenue share analysis of major players. Relevant data is collected from both paid and unpaid sources to build a reliable database. This information is then integrated to support primary research and market sizing, with validation from key stakeholders such as distributors, manufacturers, and associations.
4. Market sizing
Our market sizing is built on a bottom-up approach, starting with company revenue data gathered directly through primary interviews, alongside production volume figures from manufacturers and installation or deployment statistics. These inputs are then pieced together across regional markets to arrive at a global estimate that stays grounded in actual industry activity.
5. Forecast model & key assumptions
Every forecast includes explicit documentation of:
✓ Key growth drivers and their assumed impact
✓ Restraining factors and mitigation scenarios
✓ Regulatory assumptions and policy change risk
✓ Technology adoption curve parameter
✓ Macroeconomic assumptions (GDP growth, inflation, currency)
✓ Competitive dynamics and market entry/exit expectations
6. Validation & quality assurance
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Our triple-layer validation process ensures maximum data reliability:
✓ Statistical Validation
✓ Expert Validation
✓ Market Reality Check
Trust & credibility
Verified data sources
Trade publications
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Industry databases
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Regulatory filings
Government procurement records and policy documents
Academic research
University studies and specialist institution reports
Company reports
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C-suite, procurement leads, and technical specialists
GMI archive
13,000+ published studies across 30+ industry verticals
Trade data
Import/export volumes, HS codes, and customs records
Parameters studied & evaluated
Every data point in this report is validated through primary interviews, true bottom-up modelling, and rigorous cross-checks. Read about our research process →