AI Search Is Rewriting How Hotels Get Discovered — Budgets Are Chasing It Upstream

AI Is Moving Hotel Discovery Ahead of the Booking Funnel

Artificial intelligence is changing where hotel discovery happens in the traveler journey — and that shift is forcing hospitality commercial teams to reconsider a question that is both new and surprisingly unresolved: who actually owns visibility, and where should the budget go?

Recommendations are increasingly formed before a traveler reaches an OTA, a metasearch site or a hotel website. Research cited from Curacity and Cornell puts the scale of the problem bluntly: 94% of hotels are invisible in AI search results. A property that never enters the consideration set cannot generate demand for its direct channel to capture. In the broader search landscape, SparkToro's clickstream analysis found 68% of U.S. Google searches now end without a click to any website, up from 60% two years earlier — with AI Overviews cutting click-through rates by roughly 60% where they appear.

Senior leaders at two hospitality groups say they are already adjusting. Jenna Villalobos, chief revenue officer at Outrigger Hospitality Group, said the company still spends most of its commercial budget in the middle and lower funnel but is placing more emphasis upstream, where future demand starts. Outrigger is working with Curacity on third-party editorial placements and testing generative engine optimization (GEO) through the Curacity VISTA product. Lance Burton, vice president of marketing at Remington Hotels, argues AI optimization should be treated as a long-tail investment in the same way as search engine optimization — a stance that will collide with hotel owners who want fast, measurable ROI.

The operational issue is equally basic. Villalobos said no single team formally owns visibility at Outrigger: SEO and LLM visibility sit with product and analytics teams, while OTA relationships sit with revenue. The 2027 commercial budget cycle is where hotel companies will decide how much money moves toward creating demand rather than capturing it.

Who Owns Visibility? How Hotel Budgets Are Shifting Upstream

The 94% Problem and Zero-Click Search

The most consequential numbers in this story are directional rather than definitive: the 94% invisibility figure comes from work by Curacity, a company that sells visibility solutions, so it should be read as an industry signal rather than an audited statistic. What it describes, however, fits the wider evidence. SparkToro's data shows zero-click search accelerating faster than the firm has ever recorded, and AI Overviews alone cut click-through rates by roughly 60%. For hotels, the practical effect is that the consideration set is now formed in a place their current analytics mostly cannot see. The traditional logic of brand awareness — that years of recognition and loyalty membership protect large global chains — still holds, but it protects a smaller share of the journey than it used to.

Outrigger's Upstream Pivot

Outrigger is the clearest example of a brand redirecting spend before demand arrives. Villalobos describes the commercial operation as a coordinated effort across revenue, CRM, direct-channel technology and business intelligence, with activity planned across the full funnel so demand is built before occupancy gaps appear. The company is investing in third-party editorial environments through Curacity to reach travelers who have not yet chosen a destination, and it has included Curacity in next year's budget while testing GEO. The bet is that authenticity and third-party storytelling become more valuable as AI-generated content becomes easier to produce — a position that favors distinctive independent properties over generic content.

Remington's Portfolio Problem and the ROI Squeeze

Burton's situation is different: managing a portfolio across multiple brands means visibility depends on the website, technical setup, content, reviews and guest experience, with marketing often acting as quarterback. His stated constraint is the one that will shape most 2027 budget debates: owners want measurable ROI and they want it quickly. AI optimization, like SEO before it, is a long-tail effort whose payoff is hard to pin to a single booking. The danger for hotel companies is that the activities most responsible for entering the consideration set are also the hardest to justify in the budget meeting.

Who Gains and Who Loses as Discovery Moves Upstream

The shift is unevenly distributed. Large global brands start with accumulated recognition and direct demand, so their exposure is lower. Independent and regional brands have less room for error — if they are not surfaced during research, they may never enter the conversation — but they also have more room for the distinctive storytelling Burton says AI-era discovery rewards. Curacity and similar providers benefit directly as vendors of the editorial placements and GEO tools brands now need. OTAs and metasearch face the longer-term question: if consideration is formed before travelers reach their platforms, the demand that flows to them may already be pre-filtered.

2027 Budget Moves for Hotel Commercial Teams

• Formally assign ownership of AI visibility: Villalobos said Outrigger will likely formalize this with its analytics team because that is where the data and opportunity identification sit — SEO, LLM visibility and OTA relations currently operate in separate silos.
• Reallocate part of the 2027 commercial budget to demand creation: Outrigger still spends most on the mid and lower funnel but is shifting emphasis upstream and has Curacity included in next year's budget; brands that stay downstream risk converting a shrinking pool of demand.
• Treat GEO and LLM optimization as a long-term investment, and set owner expectations accordingly: Burton warns the biggest constraint is owners demanding fast, measurable ROI on what is explicitly a long-tail effort, much like SEO.
• Replace last-click attribution for upper-funnel activity: Villalobos says travelers encounter a brand in many places before booking, and that influence — measured over weeks — is what current attribution models miss.
• Lead with owned storytelling and earned media: Burton notes independent hotels have more room to tell distinctive stories, and Villalobos argues authentic third-party content gains value as AI-generated material proliferates.