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They came, they saw, they conquered. That pretty much sums up the story of boutique hotels.
Despite their much-publicised rise in popularity, boutique hotels are still a mystery to many. Yes, they are classy and aesthetic, but what else do you know about these types of hotels?
In this post, we’ll share everything there is to know about boutique hotels, from their history to what sets them apart.
What is a boutique hotel?
A boutique hotel is a type of hotel that feels small, intimate, and quaint. It typically has less than 100 rooms and offers guests an ultra-personal service. Unlike the way most other hotel brands are perceived by the public, a boutique hotel stays true to the local culture.
This is how Tiffany M. Braun put it in her case study on the emergence of boutique and lifestyle hotels:
“The emergence of boutique hotels features properties with contemporary or minimalist décor while offering many additional lifestyle amenities. These properties have a high level of customised services, reflecting the personality and style of the owner, designer, or entrepreneur.”
Boutique hotels might be small, but that doesn’t mean they lack amenities. In fact, these hotels are so stacked that they give other bigger, much more spacious hotels a run for their money. From state-of-the-art spas to posh lounging areas, it’s fair to say that these hotels have it all.
Now that we’re done with the definition, let’s take a quick look at the history of boutique hotels.
The rise of boutique hotels. From 1981-2025
Although there is some quibbling as to the actual origin of boutique hotels, many publications trace the entire idea back to one Bill Kimpton.
Kimpton was a mobile investment banker for the better part of the ‘60s and ‘70s. He was traveling in Europe a lot, and he was staying at these little hotels where you get to know the owners, have wine in the lobby, and everything was personable and intimate.
Upon coming back home to the U.S., he would find hotels with no personality at all. That irked him a lot. So he decided to open a boutique hotel where everyone feels like they’re at home. He was just very much about making a fireplace in the lobby and people remembering each other’s names. And that’s how the idea of boutique hotels was born in the U.S.
On April 1, 1981, The Bedford Hotel, America’s first-ever boutique hotel, opened its doors in San Francisco. Other boutique hotels cropped up soon after, including the New York-based Morgans, founded by Ian Schrager in 1984. While it’s Kimpton who brought the boutique hotel idea into the U.S., it’s Schrager who truly revolutionised it. The Morgans Hotel Group, which runs hundreds of boutique hotels, has since become an iconic brand.
Today, multinationals have honed in on the phenomenon, creating their own brand of boutique luxury resorts and lifestyle hotel chains.
What do the numbers say?
The boutique hotel industry has experienced remarkable transformation since its humble beginnings. What started as a niche concept has evolved into a powerhouse sector that's reshaping the entire hospitality landscape.
The Global Boutique Hotel Market is now projected to reach a staggering USD 50.5 billion by 2034, up from USD 25.2 billion in 2024. That's a robust 7.2% CAGR growth rate that puts the sector on an impressive upward trajectory.
Image and data source: market.us
To put this explosive growth into perspective, the boutique hotel market is expanding nearly twice as fast as traditional hotel segments.
But here's what makes these numbers even more compelling: 88.9% of boutique hotel stays are driven by leisure and vacation purposes, according to recent industry research. This isn't just about business travel anymore – it's about travellers actively seeking out unique, personalised experiences that only boutique properties can deliver.
The shift in consumer behaviour is undeniable. Today's travellers, particularly those from the middle and upper classes with rising disposable income, are prioritising experiential tourism over cookie-cutter accommodations. They want authenticity, local culture, and that "special something" that makes their stay memorable.
The numbers tell an encouraging story. While approximately 72% of hotel rooms were brand-affiliated in the US in 2023, boutique hotels are carving out their own distinctive space by capitalising on the growing demand for individualised travel experiences. They're not trying to compete with chain hotels on scale – they're winning on personalisation and authenticity.
The global picture is equally promising. In emerging markets like India, the organised hotel sector achieved a 67.5% occupancy rate in 2023-2024, the highest level in a decade. This surge demonstrates that travellers worldwide are embracing boutique-style hospitality.
Here's what the data reveals about today's boutique hotel landscape:
- Leisure travellers make up 70.2% of the boutique hotel market, confirming that experiential travel is driving growth
- The luxury segment dominates with 53.2% of market share, proving that guests are willing to pay premium prices for exceptional experiences
- Direct bookings account for 41.2% of reservations, showing that travellers prefer the personalised service and better rates that come from booking directly with boutique properties
- North America leads globally with 37.2% market share, generating USD 9.3 billion in revenue in 2024
These figures paint a clear picture: boutique hotels aren't just surviving in today's competitive landscape – they're thriving. The sector's success stems from its ability to deliver what modern travellers crave most: authentic, personalised experiences that create lasting memories.
As government support for tourism infrastructure continues to grow worldwide, and as consumer preferences increasingly favour unique over uniform, the boutique hotel industry is perfectly positioned for sustained growth well into the next decade.
7 Defining characteristics of boutique hotels
If you’re looking to create your own boutique hotel or renovate an existing one, here are few things to consider:
1. Size
If it has more than 100 rooms, then it’s going to be tough to generate that “special something” a boutique hotel needs. Boutique hotels can have as few as 10 rooms. It’s the quality that matters, not the quantity.
Creating a sense of intimacy and cosiness should be your ultimate goal as you design your boutique hotel.
Instead of adding more rooms, create a “communal living space” where guests can get together, share a drink, and have a good laugh.
2. Chic design
The interior design of a boutique hotel is as unique as its operations, but it’s always upscale. It often blends modern elegance with historic details.
3. Personalised service
Your boutique hotel is not going to take off if you don’t offer individualised service. So, treat your guests in a way that’ll make them feel truly at home.
Enable them to customise toiletries, amenities, and everything in between (if you haven’t yet, please do have a look at attribute based selling). Also, greet them by name when they check-in.
4. Local culture
Boutique hotels are all about staying true to the local culture, from the cuisine to the décor. For instance, you could line up the walls with local paintings and drawings.
You could also offer free tours for your guests to see what the local town has to offer.
It’s also within the framework of “boutique” thinking to go counter-intuitive here. A fully-stacked hunting-themed hotel as an island in the middle of a tough urban setting can work just as well as an industrial design-themed hotel in the middle of the woods. The key is in the execution. It must be flawless, authentic and impassioned beyond belief!
5. Ideal location
Due to their small size, boutique hotels are often situated in lively, upscale areas or high-end residential neighborhoods. A few are also found in resort areas that are tucked away from the crowds but with good access to public transportation.
If your boutique hotel is going to thrive, make sure that it’s in a superb setting. That could be a few miles off the city, somewhere in the heart of nature, or a privileged clifftop location surrounded by beautiful gardens and swathes of sea and sky. The world is your oyster.
6. Individualised décor
Although many boutique hotels feature loads of modern amenities such as air conditioning, infotainment systems and rain-showers, they also burst with individual features.
The idea here is to have unique décor that gives your space a warm, welcoming personality. Paint any old furniture in funky colors. Use topical, locally sourced materials to give the interior an aesthetic look and feel. You could also add designer furnishings and quirky touches. In other words, make sure your décor creates a memorable visual experience.
7. Top-notch restaurant
You’re not done yet. Consider incorporating local foods into your menu. If possible, add an exotic restaurant or bar.
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Boutique hotels vs. chain hotels: What's the difference?
Besides being much more personalised and therefore more “niche” than chain hotels, there are several characteristics that truly distinguish boutique hotels. Here are a few:
Boutique hotels
- Typically has 10 to 100 rooms
- No two boutique hotels are alike. Each boasts its own unique design, décor, cuisine, and style
- Have a small family-like staff contingent
- Concentrate on comfort, luxury, and intimacy
- Owned and operated by a local entrepreneur, hence have more autonomy
- Put emphasis on having all possible amenities, along with a few unexpected extras to add that “wow factor”. These include in-suite dressing rooms, luxurious tubs, fine linens, private balconies, and more
- Local experience, local focus. Boutique hotels give guests a better taste of the geographical location they’re visiting
- Mostly located in hip, fashionable urban areas where there’s good access to public transport
Chain hotels
- Can have anywhere between 100 to 1000 plus rooms. As of December 21, 2020, there were an average of 313.1 rooms per hotel in the upper chain type in the U.S
- Typically standardised across all locations when it comes to size, décor, style, cuisine, etc.
- Concentrate on overall comfort
- Owned and operated by a major hotel corporation
- Employ many employees to handle check-ins, check-outs, laundry, and housekeeping duties
- Put emphasis on having only essential amenities
- Provide the same service and experience no matter the location
- Given that they’re big and spacious, most regular hotels are situated in areas with a good flow of tourists i.e. near the beach
Essential tips for starting your own hotel
Opening a hotel is something many entrepreneurs consider. Even hosts with nothing more than a few spare bedrooms wonder if they could turn them into a trendy boutique hotel.
After all, the concept of individualised hospitality is one of the hottest things in the hotel industry right now. We have rounded up all of the top tips to help your boutique hotel stand out from the rest.
1. Go the extra mile
It’s not enough to offer just personalised service. To be the best among the best, you’ve got to incorporate the following traits into your boutique hotel:
- Complimentary breakfast
- Full, modern spa or bar
- Distinctive, fully-fledged guest rooms with an upscale look and feel
- Unique family and group activities, e.g. nature hikes, yoga classes, cooking courses
- Top-of-the-line entertainment options
- Stylish lounge area or bar
- Pet-friendly
2. Be a jack of all trades
Being a good multitasker definitely helps in staying on top of everything that happens around the hotel. One second you might be ushering in some new guests. The other, you’re helping with some administrative work.
3. Take on a guest-first approach
Always think of how the guest feels around your hotel and what can be done to improve their experience.
Your first-contact staff have to be welcoming, full of smiles, and have good positive body language. They should embody hospitality and not just be angling for tips.
4. Be open to feedback
Becoming a great hotel doesn’t happen overnight. It’s a matter of adapting and continuously evolving based on client feedback. When guests bring out points of improvement, act on them fast. Doing so will put you ahead of the game.
Famous boutique hotels worth visiting
If all you need to start your own boutique hotel is some inspiration, we’ve got it in plenty. Here a few of the top boutique hotels in the country:
- The Jefferson – Washington, DC (Exemplifies all that its namesake, Thomas Jefferson, held dear, including elegantly appointed suites and fine dining)
- The Inn & Club at Harbour Town – Hilton Head Island, SC (Surrounded by 5000 acres of pristine coastal expanse)
- Wentworth Mansion – Charleston, SC (Features complimentary hors d’oeuvres and wine each afternoon)
- Williamsburg Inn – Williamsburg, VA (Offers complimentary transportation around the historic area)
- The Inn of the Five Graces – Santa Fe, NM (Features Adobe buildings with mud walls, colorful textiles, and mosaic-tiled bathrooms)
- Auberge du Soleil, Auberge Resorts – Rutherford, CA (Renowned for its culinary roots, spectacular views, and exceptional service)
- The Chatwall, a Luxury Collection – New York, NY (A little hotel that acts like a big hotel, with a beautiful lobby, private dining room, and a ballroom)
- Hotel Wailea – Wailea, HI (Boasts 180-degree, unobstructed ocean views of three Hawaiian Islands)
One thing is for certain when running a boutique hotel, you absolutely have to have the best hotel technology stack to ensure that every operational aspect of your business is performing optimally.
Final thoughts
Boutique hotels succeed by delivering flawless, personalised experiences—but behind the charm, efficiency is key.
Planet’s all-in-one solution combines PMS, Payments, DCC, and a powerful Booking Engine, ensuring seamless operations while maximising revenue.
From effortless check-ins to integrated payments and optimised bookings, Planet takes care of everything, so you can focus on what truly matters—exceptional hospitality.
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