Evolution of Hospitality Industry

A Brief Timeline

Reading time: 5 minutes

In the year 1980, the United Nations World Tourism Organization announced the day of September 27 as “World Tourism Day”. The idea of this celebration is to bring sustainability to the tourism sector all around the world. UN World Tourism Organization defines tourism as “Activities of persons traveling to and staying in different places for not more than a consecutive year for leisure, business or traveling purpose.” The inception of traveling is as old as mankind. Our ancient civilizations traveled great lengths in search of food and shelter. Over the time, the purpose of traveling changed. The mere act of traveling has now become a giant industry. The tourism industry is a collage of various services like transportation, food, and beverages, lodging, travel agencies, entertainment, etc… Back in the old times, land and water were the only means of transportation and were often considered risky. But as the innovations gave birth to more convenient and safer ways of transportation, the tourism industry saw a humongous growth in the number of travelers all around the globe. The tourism industry that we see today is the product of evolution in the hospitality sector, Innovations in transportations, advancements in communication technology, etc.

The idea of hospitality is what lies in the center of the tourism industry. The term Hospitality has been derived from a French word “Hospice” which means “Taking care of the travelers”. In Old times, locals used to let the travelers’ rest on kitchen floors or other extra spaces during their journey. There were no purpose-built resting facilities for tourists until monasteries built one. This gave birth to lodging services. In the late 1700s, Inns came into being. Inns were nothing but a shelter by the road where travelers can stop to take rest and get some food. They would also take care of traveler’s horses while they rest. The seeds of the modern hospitality facility were planted then. What we see today is the growth of the past two millennia. Here’s how the lodging facilities evolved with time.

19th Century: Indulgence of luxury into the Evolution of Hospitality Industry

In the early 1800s, “Inns” were the only lodging facility available for the tourists. A lot of Inns were established prior 19th century. But lodging was not just about bedding and resting facility anymore. They started providing food and drinks to the travelers. And soon the element of luxury blended in. This gave birth to hotels. Hotels emerged as more sophisticated facilities which provided better rooms and dining areas. The year of 1829 is considered as a landmark in the timeline of the American hospitality industry. It was the year when an American architect Isaiah Rogers designed and constructed the first luxury hotel “Tremont Hotel” in Boston, Massachusetts. It was the first hotel with private attached bathroom and lock on the doors. It used a steam-powered pump to lift water to the storage tank on the roof. “Tremont Hotel” had set a benchmark for the luxurious hotels in those days. The hotels and Inns then on started giving more importance to services to stand out differently than other hotels. They kept improving their services and facilities. At the later stage, hotels had bars. And soon the bars became an important selling point for the hotels. The architecture and aesthetics of the hotels were improving alongside. There were more multistory hotels and they had the beautiful exterior to stand out different from other hotels. Soon it was a trend for well-decorated ceilings and beautiful crystal chandeliers.

20th Century: Beginning of Modern Hospitality Era

Hospitality, which was rather a part of the culture, emerged as a huge business opportunity. Many people started building hotels, and they incorporated more and more facilities. Innovations in transportation systems enabled more and more people to travel. Some people saw the opportunity and jumped into the hotel business. That is why in the early to mid-20th Century, a lot of giant hotel chains started doing their business. The industry had become more competitive than ever. In the year 1919, Conrad Hilton opened his first hotel in Texas. Later on, Conard also bought the Ellsworth Statler’s chain of hotels in the year 1954. Marriot (Est. 1927), Sheraton (Est. 1937) and Hyatt (est. in 1957) also emerged as giant players in the industry.

There is an interesting story behind why Kemmons Wilson started Holiday Inn series of hotels and inns. Once Kemmons Wilson had gone for a holiday to Washington DC with his family. He had to pay extra for his five children in all the hotels they stayed in. Kemmons found the accommodations very expensive and uncomfortable for families. So he started his own hotel. That is how the first Holiday Inn started in the year 1952. Holiday Inn set better hospitality standards. Their main focus was to build family-friendly hotels. With their first hotel built in 1952, Holiday group went on to build its 1000th Holiday Inn in the year 1968. It was a phenomenal growth for any hotel brand in those days.

Cars became extremely popular in the mid-20th century. Intercity traveling became more convenient because of the well-connected network of roads. These factors favored the growth of Motels. The word motel is made up of “Motor and Hotel”. Motels were small 10×10 Ft wooden cabins for the travelers to take rest during the night journeys. They built these motels alongside the main highways to host more and more people who might want to take rest for a few hours or stay overnight during their journey. The concept of the motel was well received, and they grew exponentially in numbers in a later stage. The motels were affordable and convenient and that is the reason why the concept of Motels was well received.

21st Century: Technological Integrations in the Evolution of Hospitality Industry

While it all started with providing only a place for sleeping, the traditional hospitality industry has evolved to become what we see today. Despite all the changes the industry saw, the customer has always been at the center. It is consistently evolving to become more advanced. In this new century, the hotels reached the new heights, literally. People built some of the tallest hotels in the 21st century. The technological advancements in the engineering made it all possible. Hotel Fairmont Makkah and Burj Al Arab are some examples of it.

Founded in the year 2008, Airbnb opened up a new segment in the hospitality industry. It acts as a marketplace connecting people who wanted to rent their property with those who want to rent it. Since more and more people are traveling for business or for leisure, this gives them a very convenient and affordable option. Also, there has been a great hike in the number of solo travelers globally. These solo travelers not much bothered about the amenities. They don’t mind sharing spaces. They love meeting and interacting with locals and fellow travelers. And that is why concepts of youth hostels and home-hospitality have become new trends. The Internet helps a lot to such hospitality businesses. People can see the availability, photos, and reviews from other users. Today, we can browse through all options for staying in any part of the world. We can know about services and amenities. Not only we can reserve our stay, but we can also pay in advance. The recent trends in the evolution of hospitality industry favor the construction of hotels which has a classic historic touch integrated with modern services.

The hotel industry has always contributed largely in terms of revenue for any healthy economy. The modern hotel industry in 1960 valued around $3 Billion, which crossed the mark of $25 Billion in the year 1990. These numbers went down because of attacks of 9/11 and recession in the early 2000s. But the industry and its people stood strong and got back its lost pace soon in the new decade. Today, the hotel industry is worth more than $500 Billion providing jobs to 4.5 million people.

Quick Facts

  • Global Hotel Industry total retail value is 570.18bn USD
  • Average Daily Rate in Hotels in Europe is 139.42 USD
  • No. of Marriott International Hotel Rooms are 1.16Million
  • Revenue of the US Hotel industry is 218bn USD
  • Average Daily rate of hotels in the US is 129.83 USD
  • The occupancy rate of US Hotel industry 66.2%
  • RevPar of hotels in the US is 85.96 USD
  • Share of Americans who spend more than 500 USD per person on hotels is 28%
  • Share of Americans who prefer booking hotels online is 88%
  • US travelers favorite hotel loyalty program is Marriott Rewards
  • Share of travelers willing to pay more for internet access at a hotel is 28%

Source: Statista

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