Winning the Last Dollar: Why Hospitality Tech Must Pivot to Capture Today’s Frugal Consumer

As consumer confidence wavers under the weight of tariff-driven inflation and rising living costs, hospitality leaders must navigate a market defined by tight disposable incomes and a strict attitude to credit usage. With a third of Americans left with under $100 in monthly expendable funds - and nearly one in five with less than $50 - guest spending on dining, drinks and in-room services is getting harder to capture. 

 

One positive amid the economic downturn is that Americans appear to be prioritizing small treats like dining out and getting takeouts over big ticket purchases, and even over spending in other categories like clothing and personal care. 

 

Attest’s 2025 US Consumer Spending Trends Report finds that 51.5% of consumers typically spend money on dining out each month and 57% buy takeout food. In comparison, 46% spend on clothing, and 44% make personal care purchases like cosmetics, beauty treatments and hairdressers.

 

With that said, the amount consumers are spending on prepared food remains low. Only 27% spend in excess of $100 per month on eating at restaurants, while 20% spend more than $100 on takeouts. For hotel and restaurant IT leaders, these trends underscore the need to invest in seamless front-end experiences, agile back-office systems, and advanced analytics to convert constrained consumer spend into enhanced guest loyalty and operational resilience.

 

Since the introduction of sweeping tariffs in early 2025, US inflation has shown tentative signs of cooling, yet consumer wariness remains high. Over 38% of consumers report feeling financially insecure, while 39% feel financially secure, highlighting distinct polarization. 

 

This sentiment has contributed to waning purchase intent for big ticket items. Since six months ago, the number of consumers planning to buy a smartphone or TV in the next 12 months has declined by -5 points, while intent to buy computers and sofas has also dropped by a few points. 

 

Our data reveals that 29% of Americans have monthly disposable incomes below $100, with female consumers disproportionately affected (36% under $100 versus 20% of males). Even among high earners, only two-thirds boast over $500 left to spend, highlighting a mass market increasingly reliant on value-driven experiences.

And despite public reluctance to commit to large discretionary outlays (undoubtedly including spending on hotel stays), technology refresh cycles within hospitality must press on: outdated PMS, POS, and network infrastructure can undermine guest satisfaction and data security.

 

If hotel and restaurant operators are relying on consumers to whip out their credit cards to make up for shortfalls in their disposable incomes, they are likely to be disappointed. Most Americans say they would save up for something they can’t currently afford (62%), and have low engagement with credit products. 

 

More than 42% don’t have any outstanding debt on credit cards, store cards or short term loans. What’s more, 22% don’t actually own credit or store cards, making it difficult to spend above their means. But, of those who would use credit to make a purchase, credit cards are by far the most popular form of borrowing.

 

Penetration of “Buy Now, Pay Later” models is expanding rapidly across travel, however, our data shows consumer uptake remains relatively low. Only 7% of consumers say they’re likely to use short term instalment loans. Despite this, younger shoppers show a higher interest in flexible payment options and integrating BNPL at checkout can still help to reduce cart abandonment and broaden booking base without increasing credit risk.

 

One payment trend the hospitality industry should take note of is a rising desire to pay with cellular devices and digital wallets being driven by young consumers. Nearly 22% of those aged 18-30 would choose to use their smartphone or watch for an in-person transaction. Likewise, if making a purchase online, 24% would prefer to use a digital wallet on their device (such as Apple Pay). Hospitality IT must therefore support NFC-enabled kiosks, tokenized card readers, and SDK integrations for popular wallets to meet guest expectations.

 

A surprising finding from the Spending Trends Report was that restaurant tipping in this troubled economy has actually increased, shifting decisively toward 20%. Six months earlier, diners were equally as likely to give a 10% gratuity but now the balance has tipped. 

 

Despite President Trump’s proposed “no tax on tips” initiative yet to be approved, this trend is positive news for hospitality workers, as well as restaurant operators as they seek to retain staff amid labor shortages. The research also showed that bartenders are likely to enjoy reasonable tipping, with 60% of consumers routinely tipping for drinks and 45% tipping $5 or more. A third of people said they tend to tip hotel cleaners, with $5 also being the most commonly tipped amount, but the least tipped service providers are hotel porters - only 24% usually tip them. 

 

To facilitate tipping, CTOs and CISOs should embed digital tipping options across guest touchpoints. Integrated POS systems can accurately calculate and prompt tip options, while QR codes and mobile apps enable contactless gratuities for housekeeping, bartenders, and valet teams.