World smart hospitality market to reach over $12B by 2025
According to Research and Market’s latest report, the global smart hospitality market is projected to grow at a compound annual growth rate of 13 percent during the coming five years. It is expected to reach a total market size of US$12.727 billion in 2025 from US$6.067 billion in 2019.
The market is driven by the rising internet penetration and growing inclination towards IoT which are encouraging the hospitality segment to offer smart solutions to their customers with the use of digital technology. The growing use of cloud computing across the hospitality sector is another contributing factor to the market growth of smart hospitality. The increasing number of contractors are teaming up with different tech firms to build smarter hotels with low cost and less time which, in turn, is positively impacting the smart hospitality market growth.
The demand for smart hospitality is boosting in order to serve excellent customer service. The demand for real-time optimized guest experience management is increasing which is bolstering the market growth of smart hospitality. For example, in some hotels, customers can use their smartphones to control the room’s environment by way of allowing remotely open and close the window blinds and regulating the room temperature.
The innovative smart hospitality provides easy check-in options for hoteliers, room selection, room services, and comfortable stay which in return help hotels to retain guests and earn them more revenue.
Hotel companies are also adopting smart hospitality solutions as they help to save operational costs and generate more revenue while enhancing their hospitality services. In addition to this, smart hospitality solutions allow energy-efficient management systems. In line with this, the growing environmental concerns and rising focus on CSR among hotel companies is also ramping up the demand for smart hospitality solutions.
In April 2019, InterContinental Shenzhen signed a strategic cooperation agreement with Huawei and Telecom to create the world’s first 5G smart hotel. Viggo Smart Hotel is delivering the first true cloud-based smart hotel TV solutions for the global hospitality industry. In December 2018, Shangri-La Group and Tencent signed a strategic partnership for developing and deploying smart hotel solutions to enhance the hotel operations and services for Shangri-La. However, factors such as high initial cost of deployment and lack of technically skilled professionals are hindering the smart hospitality market growth.
Regionally, the global smart hospitality market is classified into North America, South America, Europe, Middle East and Africa, and Asia Pacific. The APAC Smart Hospitality market will witness substantial market growth during the forecast period owing to the growing investments by international hotel chains in countries like India and China in smart hospitality solutions.