Boutique hotels are a continually evolving segment in the industry. Defying our definitions, boutiques can be historic or modern, adult or family-oriented, heavily themed, or eclectic. Once clearly identified as independent hotels with less than 100 rooms, well-known brands are adopting their characteristics in an attempt to capitalize on growing demand among travelers for a differentiated travel or lifestyle experience.

Likewise, our sense of luxury is constantly changing. A luxury isn't absolutely necessary to survival - but whose standards apply? In the hospitality industry, in-room Wi-Fi, flat screen televisions, and high thread counts are no longer considered luxurious. As technology evolves, guests become savvier, and hotels step up their services, many hoteliers are struggling to stand out in the crowded luxury market.

These forces present both a challenge and an opportunity for luxury boutique hotels. On one hand, they are faced with innovative competitors and always-increasing standards of service, design, and amenities. But on the other, they encourage experimentation, being bold and setting new standards of excellence.

It's all too easy for hoteliers to fall back on tried-and-true formulas in designing the next crop of boutique hotels. Today's formula is working, as evidenced by the growing popularity of boutiques. However, the segment's hallmarks ...