While the luxury goods sector is in a slump, the luxury hospitality sector remains a bright spot. Luxury hospitality sales were up 5 per cent last year, when personal luxury goods were flat, according to management consultancy Bain Co.
LVMH has taken notice: last year, the conglomerate signed an agreement with global hospitality group Accor to invest in the Orient Express trains, hotels and its two future sailing ships; and took minority investment in French boutique hotel business Les Domaines de Fontenille. This added to its existing portfolio, which includes Cheval Blanc hotels, luxury travel operator Belmond and Bvlgari Hotels (in partnership with Marriott International’s luxury offshoot, The Ritz-Carlton).
“[Hospitality] is a good diversification, without being a new [Louis] Vuitton,” LVMH chair and CEO Bernard Arnault said during the company’s annual earnings conference in January, referring to the fact that hotels will never be as profitable as its biggest luxury fashion brand in terms of margins because of the investment they require. “It’s very complementary [to luxury goods]. Today’s customers like diversity. When they buy a Vuitton trunk for €50,000, they also like to spend a weekend between Paris and Venice on the Orient Express, and when they arrive in Venice, stay at Hotel Cipriani before visiting the LV boutique. That’s the idea.” Taking this even further, it’s understood Louis Vuitton’s latest concept on the Champs Élysées, slated to open in between 2027 and 2028, will include hotel suites.
The conglomerate’s all-important fashion and leather goods division reported that sales declined by 1 per cent in the fourth quarter.
Asked by Le Figaro last week if this period of turbulence is a time of acquisition opportunities in the hotel or luxury train sector, Arnault replied: “Why not?” Though he added that luxury goods and their distribution will remain LVMH’s core business.
It’s not surprising that the luxury titan has invested in hospitality, according to Georges Panayotis, founder of MKG Group, a Paris-based consulting and market research firm specialising in the hospitality sector. “Hospitality used to meet a need, now it meets a desire for experience — it follows the same trend as fashion,” says Panayotis.
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At a time when luxury brands are doubling down on providing an unparalleled experience for their VICs (very important customers), expertise in hospitality is a key differentiator. “Now, it’s not only about crafting the programme, it’s about assisting the clients throughout their journeys, from travel to cultural experiences. There is increasingly a constant need to adapt, to deal with climate change and other unplanned events,” says Omar Chérif, founder of OC Special, which helps clients including Louis Vuitton and Valentino deliver luxury travel and lifestyle experiences.
Benjamin Vuchot, CEO of Hongkong and Shanghai Hotels, the parent company of Hong Kong-born luxury hotel brand The Peninsula, points to the growing crossover between retail and hospitality. “The traditional barriers between a luxury store and a traditional hotel environment are increasingly breaking down. We see this today in talents, in projects,” says Vuchot, who’s a perfect example: he was previously chair and CEO of DFS Group, the LVMH-owned travel retailer. (Laurent Kleitman, CEO of Mandarin Oriental, was previously president and CEO of parfums at Christian Dior; Four Seasons chief commercial officer Marc Speichert was previously L’Oréal global chief marketing officer.)
Here are some of the key trends shaping the hospitality industry in 2025 and beyond.
1. Experience is essential
Vuchot stresses the importance of offering other experiences apart from accommodation alone. “We need to give clients more reasons to get together, to have fun, in order to win over and keep their loyalty with the brands. The nicest room, the best bed, the best bathroom — that’s normal, that’s a given. On the other hand, staying in a hotel where you have one of the best bars in New York, one of the most beautiful pools in London, is very important. Similarly in retail, you open a café because it gives clients a reason to stay longer, to come back, to be treated differently and experience the brand beyond just buying the latest bag,” he says.
Louis Vuitton’s new ship-shaped concept store in Shanghai, dubbed ‘The Louis’, includes a café and an exhibition space showcasing the brand’s history. The house counts 15 cafés and restaurants worldwide.
Since 2017, The Peninsula has been offering a car rally across Japan for its vintage car-loving guests. The five-day rally starts from and ends at The Peninsula Tokyo, looping through several villages in between. The last edition took place in April. “We’ve created such an enduring emotional bond with people who’ve made that trip that I am convinced the next time they go to Japan, they will stay with us,” says Vuchot.
Hospitality — and especially hotels — can help luxury brands immerse customers in their worlds. But it’s a very different business to selling fashion, leather goods and jewellery, requiring a lot of investment and delivering lower margins. Is it worth it?
At The Peninsula Paris, a coach takes clients — who wish to go for a 40-minute jog — across the city, ending with breakfast on the hotel rooftop. “It goes with the ‘bleisure’ trend, a blend of business and leisure, consisting of combining business travel with leisure activities,” says Vuchot. “It’s an important trend because these clients are more likely to add an extra night to enjoy the city and come back.”
It’s about bringing the luxury hotel experience out of its four walls. “There’s an appreciation of the brand universe that makes you trust and participate in experiences that are a little more distant from your core business, which is accommodation, but in which we put the same intentionality in details,” adds Vuchot.
The Ritz-Carlton launched its first yacht trip in 2022, and has since introduced two more. Its latest was inaugurated in early July with a star-studded trip, whereby Naomi Campbell, Tom Brady, Martha Stewart and more were on-deck. Similarly, Four Seasons is set to sail its first yacht in 2026, and the company keeps adding itineraries to its private jet experience. Price for the “uncharted discovery” itinerary, for example, starts at $234,000 per person. “We can see that it’s paying off: what started as a trial run, is now continuing to grow,” says Vanguelis Panayotis, CEO of MKG Group (and son of Georges, quoted above). Sales of luxury cruises, and private jets and yachts were up 31 and 14 per cent, respectively, in 2024, according to Bain.
Per American Express’s Global Travel Trends 2025 report, 70 per cent of millennials and Gen Zs surveyed like to plan trips that focus on enjoying the journey (luxury rail, cruise), as much as the destination.
2. Wellness
Forget a Swedish massage at the hotel spa. Hotels are capitalising on the wellness boom with a more diverse and specialised offering. “There is a level of sophistication in treatments and techniques that we hadn’t previously seen in the hospitality industry,” says Vanguelis.
Specialised players offer a blueprint for the future of wellness-focused hotels. Sha, a fashion crowd hideaway in Spain, which opened in Mexico last year, has expanded its offering to include longevity, detox, cognitive boost, gut health, hair health and women’s health. Sha describes itself as a hybrid facility, spanning a luxury resort, clinic and wellness hotspot. “Health has become the new wealth and the ultimate status symbol,” says Sha managing director Alejandro Bataller. He notes that the longevity industry is overtaking well-being, with investments in the former having skyrocketed in the last two years. “The audience for longevity has significantly rejuvenated.”
Bataller continues: “ The longevity mindset is shifting from short-term goals — appearance, fitness, diet — to long-term goals, which increasingly focus on biological markers. Before, we had no information about ourselves. Now, we have so much more information thanks to health wearable devices and companies, so having the data allows us to optimise it.”
Longevity is on everyone’s lips: the Guerlain Spa at Cheval Blanc Saint-Tropez, for example, has introduced a treatment called Longevitskin that combines radiofrequency, plasma, cryotherapy and LED.
A new fund from wellness group Clinique La Prairie wants to supercharge growth for companies tapping into our obsession with living longer.
At Mandarin Oriental, the luxury hotel brand known for its refined sense of Asian hospitality, programmes focusing on longevity and balance seek to cater to an evolving need. “Our wellness programmes were previously built around relaxation and pampering. Now, the balance is shifting towards physical, emotional and mental well-being,” says Mandarin Oriental CEO Laurent Kleitman. At London’s Mandarin Oriental Hyde Park, for example, offerings include reiki healing, chakra balancing, and emotional healing and cleansing.
Kerzner International — which operates resorts like the Atlantis in Dubai and China, and the One&Only in various locations including the Maldives — opened Siro, its first wellness‑focused hotel, in Dubai in 2024. Siro has a collaboration with football club AC Milan, which offers insights into training and recovery procedures, according to the Siro website. The hotel offers treatments from cryotherapy to biohacking technologies, to optimise cellular regeneration and accelerate healing.
Hotels that are not specialised are also incorporating wellness in different ways. “There’s certainly an awareness of bringing more wellness into hotels, in terms of the menus and the food, having alternatives. But unless it’s a new hotel that is built to do that, it’s kind of hard to completely integrate this huge world of wellness [because of the space and the facilities required]. So there are bits and bobs that hotels take from it, but I think wellness is really a lot of things: a great swim in the sea, a great laugh, also in some way, a great meal. Someone said to me the other day, ‘restorative hedonism’. I think that’s what we do very well,” says Marie Louise Sciò, CEO of Pellicano Hotels Group, a boutique luxury hospitality collection based in Italy that includes Il Pellicano in Porto Ercole.
It can also be a good night’s sleep (Sha Wellness has a sleep programme, while Siro conceived rooms for “corrective sleep”), a good book (according to Condé Nast Traveller, reading retreats are the must-try wellness break in 2025), no phone, or meeting new people. High-luxury travellers (spending over $750 per night, as defined by McKinsey) are more likely than others to cite ‘digital detoxing’ and meeting new people as reasons to travel, according to McKinsey’s State of Tourism and Hospitality in 2024 report.
3. Hotels are upping their merch game
Hotel merchandise is no longer an afterthought.
Ritz Paris launched a collaboration with Californian fashion brand Frame in 2021, and is now in its fourth drop: there are 35 pieces, including a trench coat, a crewneck sweatshirt and gold-embroidered velvet slippers, with prices ranging from €110 to €2,220. Its distribution includes Frame stores, Ritz Paris’s concept store and e-commerce, plus retailers such as Galeries Lafayette, Neiman Marcus and Bergdorf Goodman. Le Bristol, one of the palace‑designated hotels in Paris, launched a collaboration with lifestyle label Sporty Rich in 2023, as well as its own line Le Bristol Society in 2024 that includes T-shirts, pyjamas and baseball caps.
Aman, the luxury hotel and resort brand known for its ultra-exclusive, minimalist retreats in culturally rich destinations, also has its own product brand, Aman Essentials. The label, which became an entity in 2022, sells fashion and beauty. The former is only distributed across the hotel group’s properties, while beauty products are also stocked by multi-brands such as Harrods, Violet Grey and Neiman Marcus. In June, Aman Essentials unveiled a collection of wardrobe essentials designed by former Dior Men artistic director and Aman aficionado Kim Jones.
Five months after leaving the menswear helm of Dior, the British designer unveils a capsule with Aman Essentials, the luxury hotel group’s product brand.
“The retail spaces are going to get bigger in the new hotels, more interesting, more conceptual, which is super exciting for me,” Kristina Romanova, CEO of Aman Essentials, told Vogue Business in June. “Before, it was not so strongly considered when the hotels were designed, it was more like a souvenir shop, a small addition to the experience. But now, like we’re taking it more as a lifestyle brand and obviously with this collaboration, we’re taking it to the next stage.”
Il Pellicano’s e-commerce platform Issimo collaborated with Francesca Amfitheatrof, former artistic director of Louis Vuitton jewellery and watches, on an amulet to coincide with the 60th-anniversary celebration of the hotel in June. Il Pellicano also launched a capsule with media and creative agency Highsnobiety, which includes clothing, accessories and the hotel’s signature ashtray. “I absolutely think hotel merch has become a trend,” says Sciò, “and it’s here to stay, because it’s an opportunity to bring a piece back of your experience and even if you haven’t been there, being recognised as part of the tribe. But you always have to remember to keep the main thing, which is a good hotel.”
“The investments in hospitality are colossal. The operating costs are also very high. So finding ways to diversify revenue streams while strengthening their brand image, enlarging their fanbase and standing out, is an extremely important economic strategy for [hotels],” says MKG Group’s Vanguelis. He notes that it can also be merch or a pastry shop like the Ritz Paris’s Le Comptoir on Rue Cambon, selling delicious madeleines. “Nobody is surprised that major luxury fashion houses have perfume lines. The key is really the power of the brand.”
Mandarin Oriental has flexed its branding muscles by collaborating with colour expert Pantone on its own bespoke shade, Mandarin Oriental Celadon Green. “This draws on our heritage of elegance and craftsmanship inspired by bold celadon ceramics, helping us shape a narrative through the power of colour,” CEO Kleitman says.
As guests increasingly seek connection and authenticity, hotel brands that prioritise experiential offerings, highly specialised wellness programmes, thoughtfully designed merchandise and shops will stand out. Sciò recalls: “When I started, there wasn’t a real big interest in hospitality and it wasn’t seen as a potential brand. There wasn’t fashion involvement in it, and there wasn’t lifestyle. There were these isolated worlds. In 12 to 15 years, everything’s so radically changed. Now, it’s all of a sudden very sexy and desirable.”
