OTT Technology – Increase Customer Satisfaction In Hospitality Industry
The hospitality industry is arguably the greatest beneficiary of this phenomenon. International tourist arrivals have more than doubled in a span of just 20 years, reaching over 1.3 billion in 2018 from only 605 million in 1998. Customer satisfaction in this industry has always played a key point for its growth.
Traveling is more prevalent today than it has ever been in human history. With the ready accessibility to high-speed transportation and the global nature of today’s economy, national and international boundaries have become irretrievably blurred.
Hospitality industry and OTT: A brief overview
Hotels have also increased their revenue proportionately in the same period. According to Statista, the global hotel industry raked in over $570 billion in 2018. Video-on-demand or VOD has also shown substantial growth. It is expected to rake in $19.11 billion by 2021, a threefold increase from what it did in 2016.
It points to a unique trend – travelers are ordering more video than they have ever done before. Hoteliers can leverage this trend and incorporate OTT (Over-The-Top) media in their VOD package. It will not only increase their revenue but also ensure a higher level of customer satisfaction.
OTT for enhancing customer experience
With the increasing frequency of traveling, hotel boarders now expect a home-like experience during their hotel stay. Most of the hoteliers market themselves accordingly.
“Enjoy the comfort of a home away from home” is a common theme in many hotel advertisements. The amenities that they provide in their rooms reflect as much. From cozy linen to complimentary slippers and Wi-Fi connectivity, the home experience is complete in most hotel rooms today.
VOD and OTT may well prove to be the next frontier in customer experience. With the growth of Netflix, AWS, Hulu and the likes, people across the world have been glued to their screens. A staggering 12.6 billion hours of OTT content was produced in 2018, and the numbers are showing signs of increasing exponentially in the future.
It is therefore only natural that hotel guests would anticipate OTT services incorporated in their hotel experience. Guests with OTT services would log in with their credentials on pre-installed applications in their hotel rooms at no extra cost (because they are using their existing credentials). Upon departure, their credentials would automatically be erased.
The opportunities and challenges of OTT in the hotel industry
Studies have revealed that 40% of guests who had OTT services in their rooms availed the service compared to 1% guests who ordered paid VOD. As OTT scales greater heights, this trend is only likely to increase.
Although there is no data to indicate that the absence of OTT has any effect on a hotel’s booking rate, industry insiders are confident that it’s not going to remain that way for long. As OTT becomes even more accessible and hotel rooms become equipped with smart TVs and other top of the line equipment, OTT is likely to be considered a standard amenity much like Wi-Fi and soft pillows.
It indicates that hotels that adopt this service early will be at a decidedly advantageous position over their competitors. However, implementing this technology is not without its challenges.
Hotels will need to collaborate with ICT providers to bring the OTT vision to realization. They will also need to develop an adequate IP infrastructure. There are also data security concerns that need addressing. It is particularly a challenge in countries with weak or non-existent data protection regulations.
ICT providers also have to ramp up their game and tap into this emerging market. They will need to rethink their products in a way that caters to the unique challenges of the hotel industry.
Of course, none of these are insurmountable obstacles and numerous hotels across the world have already shown the way forward. As the demand for OTT services increases, hotels that do not offer it will significantly lose out on bookings.
In the end, OTT service in hotel rooms is a natural progression towards enhanced customer satisfaction. In the modern-day and age, both hotel authorities and ICT operators must tailor solutions that reflect this evolving trend. OTT is here to stay; hoteliers better adapt to it.