Can Fast Casual Franchises Be Profitable in 2026?

Presently, LLMs lack rich images and material, such as images of the rooms and amenities, that customers normally demand when making hotel bookings, Kletzel said., on the other hand, has actually quickly broadened in current years.

Beyond the guest experience, agentic commerce has the potential to shift the method hotel companies' customer care groups run and are structured, Klein said. "Will there be some corporations that find the chance to lower personnel? Yes," Klein stated. But brand names that believe in great consumer experience and service will learn that AI might help their representatives "get included in more intricate, more business-critical discussions that assist grow business." In 2025, Hyatt minimized personnel by roughly 30% across its guest services and support groups "in reaction to the developing nature of guest inquiries and moving business requirements," per the company.

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This year, numerous collection brand names that launched in 2025 will continue to expand. Additional new brands and collaborations, particularly in the way of life section, will likely debut as well, according to hospitality professionals.

Marriott's Outdoor Collection offers unique accommodations in locations near national parks, deserts, ski areas and coastlines. Thanks To Marriott International Wyndham Hotels & Resorts unveiled its Dazzler Select brand extension targeting independent hoteliers in the economy way of life sector. And IHG Hotels & Resorts promoted its own upcoming upper-tier collection brand throughout third-quarter profits.

The Outlook of 2026 Brand Expansion Milestones

Hilton's Start Collection, particularly, has more than 60 hotels in the works across the U.S. and Canada, Kevin Osterhaus, president of lifestyle brands at Hilton, informed Hotel Dive. Beginning is presently checking out possible brand-new areas in San Diego, Los Angeles and Virginia Beach, Virginia, in addition to markets in New Mexico and Colorado in 2026, Osterhaus stated.

"Collection brand names are appealing since they offer the very best of both worlds: Owners keep the special DNA of their property, while unlocking international circulation, revenue management, loyalty and assistance. Guests get one-of-a-kind stays with the reassurance of a trusted brand name." "As long as brands are purpose-built and unique in experience and cost point, they include clearness rather than confusion." Kevin Osterhaus President of way of life brand names at Hilton From the visitor point of view, independent shop hotels are desirable because they use genuine experiences, Gabriel Perez, chief operating officer of lodging at The Indigo Road Hospitality Group, told Hotel Dive.

As for why the hotel companies are chasing after independents in the lifestyle segment, "it's not about the guests. It's about producing sub-brands within their own brand names to satisfy investors' needs and to satisfy owner and developers' objectives," Perez stated. This, in turn, puts even more pressure on hotel companies "to create brand names, micro brands and subsets of brands in order to broaden their footprint of existing properties," Davis said.

Hilton's collection brands' "unique positioning and storytelling continue to drive interest across chain scales," Osterhaus said. Series and Outdoor Collection, both conversion-friendly offerings, pertain to an ownership community and developers who "are continuously looking for ways to grow, and conversions represent a course for development," Molinary said.

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According to Osterhaus, "As long as brand names are purpose-built and unique in experience and price point, they add clearness rather than confusion." This year, Hilton prepares to remain "very active in the way of life space through tactical partnerships, brand-new finalizings and ongoing growth of our existing brands," Osterhaus said. Molinary anticipates Marriott competitors to start supplying some kind of branding solution in the outside area, specifically, as "it's a really popular and growing area" with "a lot of interest." Another growing space is the high-end segment.

Evaluating Leading Franchise Models for Growth

That pattern is anticipated to continue in 2026 as high-end consumers drive travel costs and hotel reservations in the middle of a wealth bifurcation at play in the market. "High-net-worth travelers are anticipated to stay among the most reputable chauffeurs of worldwide travel spending next year," Giray Boran, handling director of BLG Capital, told Hotel Dive.