Smart Hospitality Market - Forecast (2022-2027)

The global Smart Hospitality market size is forecast to reach $27.4 billion by 2027, growing at a CAGR of 24.9% from 2022 to 2027. The market growth is mainly driven by factors including growing demand for enhanced smart IoT based solutions across the hospitality sector, increasing demand for automation and increasing investment on luxurious hotel projects. These types of tools help the hotels in improving the level of customer services and enhances customer satisfaction level by analyzing the real-time experiences of the guest. Furthermore, various hotels are opting for integrated security system including emergency incident management system, access control system and video surveillance system; for enhancing their security system, thereby improving the overall level of hotel management system. This in turn drives the growth of smart hospitality market. Moreover, the increasing inclination towards the digital platforms created a positive impact on the growth of this market. Hence, these factors are set to boost the growth of Smart Hospitality industry during the forecast period 2022-2027.

Report Coverage

The report: “Smart Hospitality Market– Forecast (2022-2027)”, by IndustryARC covers an in-depth analysis of the following segments of the Smart Hospitality Market.

By Type: Software and Services
By Software: Hotel Operation Management System (Staff Mobility and Workforce Management, Inventory and Logistics Management and Revenue Management), Integrated Security System (Video Surveillance System, Access Control System and Emergency Incident Management System), Hotel Building Automation System (Energy Management Platforms and Facility Management System), Guest Service Management System (Centralized Reservation System, Room Automation and Control System and Guest Experience Management System), Integrated Communication Technology Solutions (Network Management System, Unified Communications and Collaboration and Mobile Device Management System) and others.
By Services: Professional Services (Consulting Services, Deployment and Integration and Support and Maintenance) and Managed Services.
By Deployment: Cloud and On-premise.
By Hotel Type: Business Hotels, Heritage and Boutique Hotels, Resorts and Spas and Others.
By Geography: North America (U.S, Canada, Mexico), South America (Brazil, Argentina and others), Europe (Germany, UK, France, Italy, Spain, Russia and Others), APAC (China, Japan India, South Korea, Australia and Others), and RoW (Middle east and Africa).

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Key Takeaways

• Cloud based smart hospitality solutions is anticipated to witness the significant market growth during the forecast period, due to its various advantages over the on-premise segment.
• Europe held the major market share in 2020 and is estimated to witness the significant growth during 2022-2027, owning to the increasing demand of automation across hotels, heavy investments on hotel projects, availability of developed internet infrastructure and others.
• The market of Smart Hospitality is estimated to witness a significant upsurge during the forecast period, owing to the growing penetration of smart technologies across the world.
• This industry is consolidated with top market players including BuildingIQ Inc., Cisco Systems, Inc., IBM Corporation, Infor, Inc., Johnson Controls among others.
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 Smart Hospitality Market Value Share, by Geography, 2021 (%)

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Smart Hospitality Market Segment Analysis - By Software

By software, the Smart Hospitality market is segmented into Hotel Operation Management System, Integrated Security System, Hotel Building Automation, Guest Service Management System, Integrated Communication Technology Solutions and others. Integrated security system is analysed to grow with a CAGR of around 23.4%, during the forecast period 2022-2027. This segment is further sub segmented into video surveillance system, access control system and emergency incident management system. These solutions help in enhancing the overall security system of the hotels. 

In order to offer the highest level of services to the customers, the hotel owners are opting for such security solutions, as it plays a crucial part in enhancing the stay of the people by improving the overall security of hospitality sector. This also effects the satisfaction level of the customers positively. Hence, these factors provide incentive to the market player to launch advanced products and to the hotel owners to adopt such solutions during the forecast period. In October 2020, a leading provider of electronic access solutions, Onity announced the launch of an all-in-one minimalist lock, Serene, especially designed for aesthetically-minded, high-end hotels. This product combines extraordinary designs with leading edge mobile access technology, DirectKey. Such developments will accelerate the adoption rate of smart hospitality technology, thereby driving the growth of this market during the forecast period 2022-2027.

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Smart Hospitality Market Segment Analysis - By Deployment

Based on deployment, Smart Hospitality Market is segmented into Cloud and On-premise. According to Smart Hospitality Market report of IndustryARC, Cloud based smart hospitality market size is analysed to with a CAGR of 26.19% during 2022-2027, owing to the increasing investments for the development of cloud infrastructure coupled with rapid digitalization across industries including hospitality. Increasing penetration of IoT and innovative new digital infrastructure solution in hospitality is playing a major role in the shift from on-premise to cloud. In May 2021, Wyndham Hotels & Resorts selected the next-gen Oracle Hospitality OPERA Cloud Property Management (PMS) for accelerating the digital transformation these hotels and resorts. Hence, the above-mentioned factors will drive the growth of this market during the forecast period 2022-2027. 

Smart Hospitality Market Segment Analysis - By Geography

Europe dominated the market with around 33% Smart Hospitality market share in 2021, and is estimated to grow with a CAGR of around 25.39% during the forecast period 2022-2027, due to increasing demand for automation across the hotels, availability of developed internet infrastructure, rapidly growing hotel business across Europe. Furthermore, due to high growth rate in tourism sector, European countries are investing heavily for the development of commercial buildings including hotels. TOPHOTELPROJECTS construction database states that, 42 new hotels will be launched in the Netherlands in the coming years, 17 new hotels by the end of 2021, 9 new hotels in 2022 as well as 8 new hotels will be opened in the country by the end of 2023 and further 8 new projects will be launched in 2024. In addition, the high penetration rate of IoT and increasing demand for contactless solution in hospitality industry offer incentives to the hotels to adopt such technology. In June 2021, Louvre Hotels Group announced the launch of its technological label ‘Smart Inside’ across Europe. This technology offers over 20 innovative features during the client’s hotel experience for an enhanced stay. Such developments will drive the growth of this market in this region during the forecast period 2022-2027.

Smart Hospitality Market Drivers

Increasing investment in hotel projects coupled with growing tourism sector will boost the demand of smart hospitality market:

The investment in hotel projects is estimated to grow rapidly over the next few years, due to the exponential growth of tourism sector, growing demand for luxurious hotels for enhanced stay, growth in purchasing power and others. According to a report of Tophotel construction Database, total 43 hotel projects including 21 four-star hotels and 22 five-star hotels, with 7,804 rooms are planned in Turkey over the next five years. Such growth in hospitality sector will drive the demand for smart hospitality solutions. Furthermore, in post covid-19 period, tourism sector is experiencing growth, which will not only drive the demand of hotels but also the contactless smart hospitality solutions. This in turn affects the growth of Smart Hospitality market positively. IBEF report states that, the contribution of travel & tourism industry to the GDP of India was $121.9 billion in 2020 and is expected to reach $512 billion by the end of the year 2028. Such growth of the tourism sector creates a positive impact of the growth of this market. Moreover, implementing smart hospitality technology helps in improving the customer impressions and satisfaction level that helps the hotels in expanding their business. Hence, the above-mentioned factors will drive the adoption of this technology during the forecast period 2022-2027.

Increasing adoption rate of advanced technologies across the world is set to drive the growth:

Increasing adoption of various advanced technologies such as 5G, cloud-based technology, IoT, AI, ML and others in the hospitality sector is estimated to create ample growth opportunities for the smart hospitality market during the forecast period. In April 2019, The InterContinental Shenzhen, Shenzhen Telecom and Huawei partnered to launch the world's first 5G smart hotel, which will enable the hotel to provide a luxurious experience to its guests, by introducing the end-to-end 5G network with integrated terminals and cloud applications. Adoption of such high-end technologies will trigger the growth of smart hospitality market. These technologically advanced smart hospitality solutions enhance the satisfaction level of the customers and helps the hotels in improving the level of their services. In October 2021, Curator Hotel & Resort Collection selected ReviewPro, as a guest feedback management partner for online reputation management and guest satisfaction surveys. Hence, the growing demand for advanced technologies will drive the demand for smart hospitality solutions, which in turn will enhance the growth rate of smart hospitality market during the forecast period 2022-2027.

Smart Hospitality Market Challenges

Security threats are harming the growth of this market:

All though the Smart Hospitality market is growing rapidly, but the security threats are creating hurdles for the growth of this market. The IoT connected devices incorporated into hotel infrastructure can be hacked and poses a threat to the database of this industry. For instance, recently Spain based software firm called Prestige Software was caught exposing sensitive data of millions of people, specifically customers of Booking.com, Expedia, Agoda, Amadeus, Hotels.com, Hotelbeds, Sabre and many more, around the globe, as it did not take proper security measures. Prestige Software, particularly provides a channel management platform, Cloud Hospitality to the hotels that handle and automate room availability on top booking sites. This data breach exposed the personal details along with financial data of the customers. Such security threats are creating challenges for smart hospitality market. Hence, these challenges are poised to impede the growth of Smart Hospitality market during the forecast period 2022-2027.

Smart Hospitality Market Landscape

Partnerships and acquisitions along with product launches are the key strategies adopted by the players in the Smart Hospitality Market. As of 2021, the market for Smart Hospitality industry outlook is consolidated with the top market players. Smart Hospitality top 10 companies are

1. BuildingIQ Inc.
2. Cisco Systems, Inc.
3. IBM Corporation
4. Infor, Inc.
5. Johnson Controls
6. NEC Corporation
7. Oracle Corporation
8. Schneider Electric Se
9. Siemens AG
10. Winhotel Solution S.L.

Acquisitions/Technology Launches/Partnerships

• In September 2021, Infor announced the availability of fully cloud-enabled hotel management software, Infor Hospitality Management Solution (HMS) version 3.8.4. Infor HMS is easily accessible in real time, which helps in keeping pace with the busy lives and schedules of the modern guest, and also enables hotels to tailor a seamless as well as contactless experience.
• In November 2019, Arrivalist, the leading location intelligence platform, announced about the launch of a next generation location intelligence platform for hotels, called Guest IQ. This platform leverages multiple mobile location datasets and adds behavioral context to current insight tools, by measuring the aggregated real-world movement of guests.