Soaring Google ad costs, stricter privacy rules, and OTA pressure are forcing hoteliers to bet big on AI
Sep 16, 2025
Hotel marketers are facing a perfect storm in 2025: ad costs are surging, privacy changes are undercutting tracking, and OTAs are ramping up their competitive edge. Yet, the hotels leaning into AI-driven ad strategies are finding outsized gains — in some cases quadrupling bookings and revenue compared to last year. Cendyn’s latest Hotel Digital Marketing Performance Index breaks down the numbers and offers a roadmap for staying ahead.
Key takeaways
- Ad spend inflation: Google ad costs for hotels jumped 20–40% year over year in early 2025, straining marketing budgets.
- Privacy disruption: New privacy rules continue to erode tracking capabilities, making campaign measurement and optimization harder.
- OTA pressure: Competition from online travel agencies is intensifying, raising the stakes for hotels to maintain direct visibility.
- AI advantage: Hotels using AI-driven campaigns achieved up to 4x growth in bookings and revenue compared to traditional approaches.
- Cost efficiency gains: AI strategies reduced customer acquisition costs by 19% while lifting conversions.
- Global benchmarks: The index provides performance insights across Google Hotel Ads, Free Booking Links, Search Ads, and Performance Max, with breakdowns by EMEA, Americas, and APAC.
Download the full report at Cendyn
