Hotel Industry Projections

Goals

To determine:
1. Total number of guests staying in hotels until 2025;
2. Percentage of hotels with RFID/Bluetooth door keys;
3. The average penetration of hotel apps; and
4. The average stays per guest.
This will be used to create a market sizing for a contactless key check-in for hotels.

Early Findings

Hotel Keys

  • The majority of hotels in 2017 used a magnetic key card to enable the guest to access the room. RFID and NFC cards and fobs are becoming increasingly popular, with many claiming they are easier for the guest to use.
  • One of the difficulties with upgrading lock technology in hotels is that it is often cost-prohibitive.
  • The mobile phone looms as a potential game-changer in the hotel lock industry. Several hotels have been experimenting with this technology over the last few years. Hilton and Starwood (Marriott) are champions of the technology.
  • The Hilton began experimenting with the mobile phone as a key in some of its hotels since 2014. Over the intervening years, Hilton has installed the technology into a larger number of its hotels. In 2017, the technology was being used in 1,700 hotels across the US and Canada. Hilton began rolling the technology out in the United Kingdom in 2017 and planned to have it in 100 hotels by the end of 2017.
  • By 2019, Hilton had installed the technology into 4,250 of its hotel properties.
  • Marriott is the largest hotel group by room numbers. It has begun installing the technology in its hotels. In 2017, the technology had been installed in 700 of its hotels.
  • A survey by OpenKey found that 67% of guests would prefer to use their mobile phones as a key over a magnetic key.
  • It is estimated that 1 million hotels globally have a version of lock that utilizes the guests mobile phone. The number of hotels in the US using the technology rose from 6% in 2016 to 17% in 2019. Marriott, Hilton, MGM Resorts and Disney hotels are among the big brands that are in the process of implementing the technology in the US.

Hotel Occupancy

  • In 2018, there were an estimated 16.97 million hotel rooms worldwide. Between 2008 and 2018, this number increased by 2.5 million.
  • In 2014, the hotel occupancy rates by region were as follows: Asia Pacific 68.6%; Americas 64.4%; Europe 68.8%; and Middle East and Africa 63.3%. When these figures are averaged the global occupancy rate can be estimated at 66.3%. Using this figure, on any given night an estimated 11.25 million hotel rooms are occupied.

Summary

  • In our first hour of research, we have managed to provide an estimate of the occupancy of hotels globally daily. This could be used to triangulate an estimate of the number of guests through to 2025. An exact figure cannot be provided as it is impossible to calculate without knowing exact room occupancy rates for every hotel, which is commercially sensitive information. This presents the best way of obtaining a reasoned estimate of the data sought/
  • We have also provided some information about the number of hotels using mobile technology as room keys. There is likely to be further information on this available, and we will likely be able to triangulate an estimate of the information sought. The information about the average number of stays is also likely to be available.
  • The average penetration of mobile apps may be a harder task, with no clear data suggesting that this information is readily available in the public domain.

Proposed next steps:

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