Latest Trends in South Korea's Hospitality Industry
The Rise of Shared Accommodation, High-Value Lodging, and Accelerated Digital Transformation

Yanolja Research recently released a report analyzing the latest trends in South Korea's hospitality industry. The report, titled “Trends in South Korea’s Hospitality Industry: The Growth of Shared Accommodation, Expansion of High-Value Lodging, and Acceleration of Digital Transformation,” highlights the opportunities and challenges faced by the industry.

According to the report, the domestic shared accommodation market has seen remarkable growth due to increasing traveler preferences for personalized and small-scale customized travel experiences. Yanolja Research analyzed data from AirDNA, a lodging and short-term rental statistics provider, revealing that the average monthly listings on Airbnb surged from 4,000 in 2015 to 61,934 in 2023. Additionally, the annual transaction volume exceeded KRW 1.1 trillion in 2023, with projections suggesting it will approach KRW 1.6 trillion in 2024.

Trends in Monthly Average Listings and Transaction Volume for Airbnb in South Korea

The report also highlighted a noticeable increase in the development and sales of high-value lodging products. As consumer preferences shift toward premium travel and diverse experiential consumption, the growth of emotional accommodations, wellness tourism, and pet-friendly lodging has been significant. These accommodations focus on providing travelers with unique experiences through personalized interiors and attentive services. In particular, the growing trend of travelers wishing to bring their pets has spurred interest in so-called "petcations," offering specialized amenities such as pet-exclusive beds and pet strollers.

Trends in High-Value Lodging in South Korea

The report also noted that hospitality businesses are rapidly embracing digital transformation. It highlighted the increasing use of digital technologies across various aspects of hospitality, including accommodation search and booking, check-in/out processes, and room usage. Furthermore, the report explained that the number of businesses utilizing core digital transformation technologies has risen significantly.

According to the report, the percentage of companies using Internet of Things (IoT) technologies increased from 26.2% in 2021 to 73.5% in 2023. Similarly, more than half of the companies are now leveraging cloud computing services. As for data analytics and artificial intelligence technologies, the percentage of companies utilizing these tools grew from less than 10% in 2021 to 37.8% and 22.9%, respectively, in 2023.

Trends in the Utilization of Digital Technologies by Businesses in the Hospitality and Food Service Industry

The report suggested that the hospitality industry should adopt an ambidextrous strategy to turn current challenges into opportunities. According to Yanolja Research, an "ambidextrous strategy" involves not only highlighting the appeal of innovative products and accommodations to transform lodging into a travel destination rather than merely a place to sleep, but also focusing on revenue management and cost reduction.

The report emphasized that "it is essential to accumulate data through revenue management solutions and property management systems and use this data as a basis for decision-making."