A Brief History of the Hotel Industry

history of the hotel industry_old hotel sign on city streetHotels are a given in the travel industry—a place travelers can stay where they know exactly what to expect. But, how did our modern hotels come to be?

If you need more fun facts to share over dinner with your in-laws, or you’re just curious about the history of something you’ve always used without a second thought, you’re in the right place. We’re here to give you a brief overview of the history of the hotel industry and the rise of modern hotels.

Early Inns in the Middle Ages

People have always had a need or a desire to travel. And when they did, they needed somewhere to stay along the way. With the rise of Christianity in the Middle Ages, lodging began to shift from informal homeowners taking in travelers to inns and monasteries that did business with people passing through town. Though these institutions didn’t have the comforts we associate with hotels today, they were places where any traveler could stay while visiting religious sites or traveling to see family.

Back then, longer trips and vacations weren’t yet common, or even imaginable. These inns were a respite from hard days of travel rather than a destination that was sought out. Because travelers were generally going by horse and carriage or on foot, inns also serviced horses and repaired carriages and fed travelers.

The Emergence of Hotels in the 18th Century

The first hotels started to pop up in the 18th century. Located near bathhouses and in resort towns, they were places for wealthy Europeans to experience warmer and sunnier climates (think Kitty recovering from her illness in “Anna Karenina”) and for government officials to stay in when traveling on business. Similar accommodations existed throughout Europe and the Middle East for traveling traders. These weren’t yet widely used by common people, but you could find a place to stay in city centers and popular destinations.

Industrial Revolution Through the Post World War II Boom

With the beginning of the Industrial Revolution and the rise of the steam engine, travel started to become accessible to more and more people. Thus, the first major boom in the hospitality business began. This was an exciting time for hotels, with rapid growth and transformation of what the industry would come to be. Hotels were beginning to predict new needs of travelers and incorporate new luxuries and amenities. They started to have lifts for luggage, indoor plumbing, free soap and shampoo, electricity, and customizable food options for guests. Travelers could now find hotel options in all major cities, and luxury hotels like Le Grand Hotel Paris came into existence for the first time, inspiring what today’s luxury hotel business would become.

Because the use of hotels was so tied to people’s finances, the post-WWII boom was hugely beneficial to the hotel industry. Transportation continued to innovate as leisure cruising and traveling for pleasure grew more common. This was the beginning of all-inclusive resorts as hotels continued to innovate to lure travelers to their properties. As air travel became more commonplace and affordable, this only increased. Travelers were now able to vacation abroad and tourism continued to grow in popularity.

The Modern-Day Hotel Industry

It wasn’t until the 1980s that the hotel business began to look like it does today. Developers around the world clamored for real estate to build hotels. The rush toward the hotel business gave us the vast array of options that are open to today’s travelers. More and more developers built and created hotels, and the industry saw the start of major hotel purchases and consolidations. These consolidations were the beginning of many of the hotel chains that are most popular today.

Today, as travel continues to grow, hotels have become more innovative than ever. Power is largely in the hand of travelers who have more options than ever when choosing where they’d like to stay. Hotels are now benefiting from the digital age as they’re able to reach their audience directly instead of through a travel agent or guide book. Because of this, they can cater to their audience more directly. This has led to an increased market for specialty accommodations such as designer hotels, boutique hotels, unique experiences like ice hotels, and nature hotel options like treehouses and huts. Hotels are reaching a bigger audience as more people travel than ever before.

With these innovations come challenges. In addition to increased competition from more hotels on the market, the internet has given rise to online travel agencies (OTAs), or sites like Expedia and Booking.com. OTAs are a middleman between hotels and their guests, helping hotels connect with customers but taking an ever-rising percentage of their revenues and often using questionable practices to drive bookings and interact with customers. Innovation in hospitality has also led to an increase of home-sharing businesses like Airbnb and Vrbo (formerly HomeAway), which are cutting into the hotel business.

The Age of Roomkey

But, the internet isn’t all bad for hotels. Organizations like ours have come alongside the hospitality industry, seeking to make things easier for guests searching for hotel options while bringing customers to book directly with the hotels.

In many ways, the history of the hotel business can’t be told without the history of travel as a whole. From a time where travel was only for the very rich, traders, or politicians, to today, where quick weekend getaways and staycations have become a part of our cultural conversation, the hospitality industry has been there serving the needs of guests. Hotels have been changing and adapting to traveler needs and customs, and they are innovating with each technological and cultural shift. From feeding horses in the middle ages to valet parking and providing airport shuttles, we can trust the hotel industry to predict our needs as we go into the future. Today, travelers have more hotel options than ever, and more tools to make a decision as they compare online reviews, travel blogs, and guidebooks.