Overheard at ILTM Cannes this month were these delicious quotes about luxury hospitality from Julia Perowne, who is the CEO of the PR firm Perowne International. (Thanks to Arnie Weissmann from Travel Weekly for the coverage)
“Travellers are spending more than ever before, hotel rates are at an all-time high and yet… something feels off.”
Luxury, she continued, feels like it’s in crisis: “It has lost its subtlety and its awe.”
And, my favorite quote, “So many of the brands have lost their novelty and now look the same. They have become beige.”
Is luxury hospitality going down the same path as luxury retail? According to McKinsey, the luxury retail market is expected to shrink in 2025. Its analysis:
“But luxury’s woes are also partly self-inflicted. The sector’s rapid expansion over the past five years has led to overexposure and has weakened the industry’s promise of exclusivity, creativity, and craftsmanship. Brands increased prices, though some failed to sufficiently adapt their creative strategies and supply chains to meet new scale requirements, thereby weakening their core value proposition and ultimately failing to keep their promise to clients. Even the brands that have evolved over the past several years are subject to increased pressure, as consumers are questioning the luxury promise—one of uncompromising product quality and personalized, white glove experiences—and demanding more innovation.”
As we close 2025. here’s what I recommend luxury hoteliers to consider for 2026 and beyond so you can get ready for the second half of this decade.
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2024’s 5-star is 2026’s 4-star
Customers have rebounded post-COVID, and the energy of “anything is fine” is gone. Abundant social media exposure of previously exclusive experiences makes those experiences feel common and standard. When such experiences are still priced at a premium, even if delivered perfectly and as seen on Instagram, luxury consumers still wonder, “Where is MY delightful surprise?” If this is happening with something you offer, your experience has been “beige-ified.”
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Hospitable people are still what win hearts
The antidote to perfect (but valueless) functional thingies, which are now just expected, is extreme personalization based on meaningful connections. It’s the difference between being served by a robot vs. a human. All the CAPEX and skills honing will mean more to guests if they’re received in a heartfelt way. To achieve this, developing emotional intelligence to truly see and respond to each guest has to become a core part of your people strategy. EQ multiplies functional value, and when done genuinely, can add color to your beige experiences.
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Customer journeys must be both inner and social
Journeys help people escape their current state and arrive somewhere different. Centered around mind, body, and soul, these journeys cannot feel lonely or crowded. Journeys that strike the right balance between inner reflection and social connection are of the greatest value. Family travel, particularly ones that are mutli-generational, most require a deft balance of me-time and together-time, but the same holds true for solo, friends, couples, and other types of group travel.
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Superlatives win: be extremely loud or extremely quiet
Stake out a position with intention and commit thoroughly to it. In the age of Reels and TikTok, a brand’s essence must be understood within 30 seconds. Brands that fail to take an extreme position—or that constantly change their position—will be perceived as mass, lose their sense of specialness, and eventually be forced to compete on price. Also, in the F&B space, the era of “this recipe comes from my mom” and over-explaning is over. If your brand embodies it, you won’t need to constantly tout it.
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A spirit of generosity is expected; a spirit of kindness will be treasured
Yes, customers are more entitled—but for good reasons. Amid geopolitical flashpoints, an unstable world order, and economic uncertainty, even luxury consumers ask, “Is that all I get?” because they are choosing to give you their business rather than spending elsewhere—or not spending at all. The luxury covenant has shifted: generosity is now implicit in the contract. Kindness is the new differentiator. Put another way, if a brand does not demonstrate generosity, it’s not luxury. For more tips, check out Unreasonable Hospitality; this should be the Bible for every luxury brand.
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Touchpoints require individual-centric intentionality to pass the BS meter
The hidden question in the consumer’s mind isn’t “Do I want this?”but “Why me, why now?” Embedded advertising in social media is everywhere, sharpening consumers’ ability to detect fraudulent claims and inauthenticity. Every touchpoint offered must center on what’s good for the customer, and upsell/cross sell/upgrades must be individual-centric to answer the hidden questions.
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If you count it, they will skip it
In luxury, if you cannot go all out for quality, it is not worth doing. When you go all out and do not compromise, customers will come—and you can name your price. But if you skimp due to financial constraints, they will sense the accountants and the Financial Controller lurking behind the decision and walk away. Luxury customers are highly attuned to where brands cut corners—and they will reject what they know is a compromised thing. Furthermore, don’t greenwash cost savings… luxury consumers aren’t stupid. They know when you’re cutting cost but framing it as saving the planet.
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Please, consider Wellness, Wellbeing… i.e. Wellxxx to be the new Wi-Fi
Projected to be nearly an $8 trillion market in 2026 by the Global Wellness Institute, wellness is neither a niche nor a secret. Wellxxx has often been associated with luxury because the ultra-wealthy spend heavily on it, and they still do, but demand extends far beyond that group. Every notable brand will have a wellness dimension. This decade-long movement is a lot like mobile adoption: slow at first—then suddenly, everywhere. Post-COVID, demand for wellxxx as a core human service accelerated dramatically, at a pace comparable to the adoption of AI over the past 12 months… so now even B2B conferences have a wellxxx component to it. Brands wanting to differentiate based on wellxxx must recognize this is either already a red ocean or soon to be one. So, unless you’re doing something really special, see point 4 above.
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It takes more to gain trust than to gain customers
Brands should manage not only customer acquisition cost, but also the cost of distrust. When trust is lost, the damage is far-reaching. Re-acquiring that same customer already costs more than the original acquisition—and then, to overcome the distrusts that they have spread into their friends, family and followers circles costs even more. In this highly networked society amplified by social media and click-driven outrage, loss of trust is never private. It’s more efficient to convert potential recovery/rebate/re-acquire spend into present-day investment focused on establishing and maintaining trust.
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Show, don’t tell and sell, authenticity
Now, great content is a commodity. AI can create content that rivals—or surpasses— those made by human creators. Media is flooded with “me-too” luxury content, and even more will be produced. Save yourself some money and resist the urge to create everything yourself. Establish a strong foundation of basic brand assets (your stock photo and video library), then invest in purposeful experiences. Invite the right guests, deliver meaningful experiences, allow access to your library, then let them tell your story—beautifully, and in their own voice.
Editor’s note: Morris Sim is the Executive Director of Montara Hospitality
