How hotels should respond to changing traveler preferences of North-American travelers to protect efficiency and profitability — Photo by Lighthouse

Economic uncertainty, changed lifestyles, and shifts in traveler preferences are transforming the way people travel. Luckily, independent hoteliers are in the perfect position to quickly adapt to these new behaviors and still thrive.

In an already competitive industry, independent hotels often have to think outside the box to gain a competitive edge on vacation rentals and hotel chains. Let’s discover how today’s North American traveler prefers to book and travel, and how hoteliers can pick the right strategies to protect their market share and bottom line.

Travel trends and why they have emerged

Shorter stays and spontaneous bookings

Research shows that more and more North Americans are looking for shorter stays like city trips or weekend getaways. Searches for stays of three nights or less have reached a three-year high, up 5% year over year. Even more striking, 40% of all searches are for single-night stays, compared to 33% in 2023.

At the same time, travelers are booking closer to their travel dates. Searches made within 28 days of arrival have been climbing steadily for two years.

These changes reflect a new traveler preference: one rooted in spontaneity and value-seeking. Due to global uncertainty, most travelers have fully changed their mentality to live in the ‘now’. This doesn’t mean reckless spending, but a changed view of what is important, with experiences emerging as the top priority. Add to that the cautious spending patterns due to economic uncertainty, and you get shorter, more frequent trips rather than long, expensive vacations.

This shift means hotels can no longer rely on predictable booking patterns or long booking windows. Success now depends on real-time knowledge of demand, dynamic pricing, and flexible distribution.

The economic drivers behind the shift

The main reason for these behavioral shifts lies in the economic uncertainty that is affecting global markets in 2025. The full picture is more complex than just a changing economic market, but it remains the main driver of changing traveler behavior:

  • High interest rates and a weaker job market have made consumers more cautious about spending.
  • Low consumer confidence and ever-changing policies continue to create uncertainty.
  • Despite financial uncertainty, the desire to travel remains strong, with the intent to spend on travel hitting a four-year high.

In other words: People still want to travel, but they’re being smarter about how they travel. Instead of cutting back entirely, travelers are opting for shorter, more frequent trips, often booked last-minute and maximizing value for money. For hoteliers, this means adapting quickly to changing demand while managing costs and efficiency.

Regional differences: The North American landscape

Canada: Domestic, value-driven, and intentional

Canadian travelers are choosing to stay closer to home.

  • Domestic bookings are up 10% year-over-year, with 77% planning local trips.
  • Travel to the U.S. has dropped drastically, only 10% plan to visit the U.S. this year, compared to 23% in 2024.
  • Travelers are looking for value, flexibility, and sustainability, influenced by rising costs.

Destinations like Newfoundland and Labrador, PEI, Quebec, and Saskatchewan are seeing over 20% growth in bookings, as travelers rediscover local gems. Canadians prefer experiences that align with their values, with sustainability, flexibility, and safety ranking high on their list.

United States: Domestic growth and purposeful travel

In the U.S., domestic travel has surpassed pre-pandemic levels, driven by local exploration and new traveler types. Popular types of travel include:

  • Road trips and regional getaways, as U.S. travelers seek affordable holidays
  • Sustainable tourism, like eco-lodges and carbon-neutral stays
  • Wellness travel, with U.S. travelers investing in mental health retreats, fitness-focused getaways, and “digital detox” experiences
  • Solo travel, especially among women and retirees

Travel is now a bigger priority for Gen Z and Millennials. They may travel differently, but they’re traveling often and with intention. The modern traveler values flexibility, technology, and personalization. They expect hotels to anticipate their needs and offer smooth, connected experiences from booking to checkout.

The impact of short-term rentals on North American travel

A competitive, but shifting landscape

Short-term rentals (STRs) have changed traveler expectations around price, flexibility, and experience. Globally, STR listings on Online Travel Agencies (OTAs) grew by 49% between January 2023 and January 2025, although growth in North America has stabilized compared to other regions.

North America has seen slower growth compared to Europe or Asia-Pacific. While STRs are still expanding, the rate at which STRs are showing up in OTA search engines is stabilizing, and hotels are reclaiming market share in key urban and regulated markets.

The regulation wave

A new wave of regulation is also reshaping the playing field. Cities like Washington, DC now require all STR and vacation rental properties to be licensed, while Irvine, California has banned STRs in residential neighborhoods altogether.

These changes stem from mounting concerns over housing affordability, safety, and local disruption. Similar measures are spreading across North America: limiting rental durations, imposing licensing requirements, and restricting eligible property types.

For independent hoteliers, this presents a golden opportunity: as regulations tighten, hotels regain their competitive advantage in trust, safety, and consistency.

What this means for independent hotels

STRs are not disappearing, they’re forced to change their practices. Their continued presence shows that traveler expectations have changed. Guests now seek the warmth and authenticity of a vacation rental, combined with the reliability and service of a hotel.

STRs may offer flexibility, but hotels offer trust, safety, and consistent service. The winning formula for independents lies in combining the authentic local touch of a rental with the professional standards of a hotel.

Independent hotels that blend local experience with efficiency can outperform both STRs and chains, but only if they act strategically.

How independent hotels can adapt

To successfully run an independent hotel in the midst of changing traveler preferences, hoteliers must combine strategic flexibility with operational efficiency.

1. Stay flexible with real-time pricing and demand insights

When booking windows shrink, pricing and distribution must move in real time.

Pricing tools help hoteliers stay competitive by automatically adjusting rates based on demand, market shifts, and competitor pricing.

By using forward-looking data and not just historical or on-the-books trends, you can:

  • Anticipate spikes in demand from local events or last-minute surges
  • Avoid underpricing during high-demand periods
  • Protect your margins during slower stretches

Dynamic pricing ensures that even when booking behavior changes suddenly, your hotel remains both visible and profitable.

2. Manage channels efficiently and expand visibility

With shorter booking windows and high competition, distribution management is critical. A channel manager centralizes all your online channels – from OTAs to your direct website – so you can:

  • Instantly update rates and availability across every channel
  • Avoid overbookings and rate discrepancies
  • Reach spontaneous travelers on the platforms they’re actually using

When every day counts, seamless connectivity helps you respond to market changes within minutes instead of hours.

3. Streamline your operations to ensure a smooth experience

Flexibility and personalization start long before your guest checks in. The right tool gives you a clear overview of every booking, allowing you to:

  • Identify last-minute opportunities to upsell
  • Manage guest preferences and communication from a single tool
  • Offer personalized touches that make short stays memorable
  • Automate repetitive tasks such as check-ins, guest communication, and pricing adjustments
  • Use real-time performance dashboards to track occupancy, ADR, and RevPAR

This not only streamlines operations, but also builds loyalty, which is essential in a market where travelers are increasingly spontaneous but still value human connection.

4. Strengthen your direct booking strategy

With OTAs and STRs capturing increasing market share, your direct channel must become one of your main drivers of bookings. Make sure your website and booking engine offer a smooth and flexible experience for every guest:

  • Offer exclusive perks (like late checkout or welcome drinks) for direct bookings
  • Ensure your website is mobile-first, fast, and optimized for last-minute bookings
  • Leverage personalized email marketing and retargeting to convert abandoned searches
  • Flexible and secure payment methods, so guests can easily pay using their preferred method

Independent hotels often underestimate the power of small improvements, but even a 5% increase in direct bookings can have a significant impact on profitability.

4. Elevate the guest experience

Today’s travelers don’t just buy a room, they buy an experience. The modern traveler does not only expect a smooth booking process and check-in, they also want the whole journey to be personalized to their preferences. Luckily, independent hoteliers have a great advantage in their flexibility to:

  • Create authentic, experience-driven packages that connect guests to your local community
  • Introduce solo travel-friendly amenities, such as shared workspaces or communal dining tables
  • Highlight sustainability practices like local vendors and waste reduction, as these factors increasingly influence booking decisions
  • Focus on personalization by recommending activities, dining options, or add-ons based on guest profiles and possible past stays

How Lighthouse can help you thrive through challenging times

Travelers across North America are booking shorter, more spontaneous, and value-driven stays. To stay ahead, independent hoteliers must match that agility with smarter operations and real-time adaptability. The Lighthouse platform gives you the visibility, control, and flexibility to respond instantly to market changes, and to varying guest expectations.

Made specifically for independent hoteliers, Lighthouse combines channel management, pricing, and operational tasks in one connected system. Together, these tools create a seamless, data-driven tech stack that helps hotels operate smarter, faster, and more profitably.

Our all-in-one platform enables:

Lighthouse for independents frees up your time, minimizes errors, and allows you to focus on what matters most: creating exceptional guest experiences.

About Lighthouse

Lighthouse is the leading commercial platform for the travel & hospitality industry.

We transform complexity into confidence by providing actionable market insights, business intelligence, and pricing tools that maximize revenue growth.

We continually innovate to deliver the best platform for hospitality professionals to price more effectively, measure performance more efficiently, and understand the market in new ways.

Trusted by over 70,000 hotels in 185 countries, Lighthouse is the only solution that provides real-time hotel and short-term rental data in a single platform. We strive to deliver the best possible experience with unmatched customer service. We consider our clients as true partners—their success is our success. 

For more information about Lighthouse, please visit: https://www.mylighthouse.com.

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