VR (Virtual reality) is fast growing with the sales of hardware headsets projected to increase by 2.2 billion in 2017 to 19 billion USD in 2020. The consumer market for VR is expected to have an annual growth of 70% over the next five years, and travel brands are pushing their experimentations with VR to deliver a new experience.
As it stands, 70% of consumers in the tourism and travel sector have a strong interest in a VR experiences, and travel and hospitality brands alike are leveraging the technology in new ways to elevate the way travelers consume travel content.
Let's take a look at the uses of VR technology in the travel & hospitality industry in relation to amplifying the guest experience.
VR Uses by Travel Brands
VR technologies are a natural fit within the travel industry. 81% of travel consumers are found to expect greater digital customer service from travel brands in 2018. VR creates immersive experiences with a perception of being physically present in a digitally created environment, creating the opportunity to attract potential customers.
Travel companies such as Thomas Cook, Virgin Holidays, Airbnb, and Expedia are already experimenting with VR to give potential customer virtual tours of destinations or accommodations. In particular, Thomas Cook’s “Try Before You Fly” VR campaign in UK and Germany has resulted in an impressive 40% return on investment. By allowing customers to experience New York City in VR via a Samsung Gear VR headset, New York excursion revenues have received a190% uplift.
“VR has helped improve sales and our customer experience. The shop has outperformed compared with the previous year and we’re up in terms of sales ..It’s a hub of activity in-store, and people are definitely drawn in when they see a customer using the VR headset.”
— Peter Ryan, Branch Manager, Thomas Cook
In this way, VR acts as a mechanism to help travel brands market travel products to potential customers more effectively. Dorothy Dowling, SVP and Chief Marketing officer at Best Western, explains that VR technologies provide an opportunity for customers to be immersed in targeted destinations and accommodations before their actual journey.
Against a backdrop of a research findings, more than 60% of travelers expressed budget as a key factor in their travel plans. Travel brands working towards building a compelling VR strategy, and using VR as a medium to captivate core customers through imagination, are easily capturing new audiences.
The State of VR Technology in Hotels
Early adopters of VR in the hospitality industry include Marriott Hotels, who rolled out Samsung Gear VR headsets and created 360 degree VR videos for its properties worldwide in 2015.
At least eight of the largest hotel chains, including Shangri-La Hotels, Best Western Hotels & Resorts, Jumeirah Hotels & Resorts, and InterContinental Hotels, have launched VR experiences as part of their marketing efforts over the past twelve months since.
“The reason we decided to do something like this (VR) was because as the digital consumer and traveler evolves, they are looking, more and more, for rich content...We also believe that providing rich, great content to consumers will help them with their travel-making process, and it helps us with the conversion process.”
— Robyn James O'Connor, Group Director of Brand & Digital Marketing, Jumeirah Hotel & Resorts
Marriott Hotels’ Virtual Reality Strategy called VRoom Service delivering VR experiences to guests via rental has proven popular with 51% of guests sharing their desire to stay at Marriott Hotels more after Marriott's own series, VR postcards. Guests are provided insight into local culture of the Andes mountains in Chile, an ice cream shop in Rwanda, and the streets of Beijing.
Neil O’Keefe, Senior Vice President of content and marketing for the Data & Marketing Association, believes that Marriott’s VRoom Service is a perfect example of a VR content strategy that delivers inspiring immersive experiences. 78% of travelers said informative content from destinations or travel brands can influence their decision-making process, making travel VR an effective marketing tool.
The Future of VR in Hospitality
As adaptations and uses of VR technology grows, so does demand from positive consumer experiences. VR technology is being used in ways that contribute to in-room entertainment, in-destination marketing, and pre-trip booking awareness.
VR is poised to be an effective solution that empowers hotels, enabling them to compete against online travel agencies (OTAs) in a new way, while enticing guests to book directly with them. VR content displayed on hotels' own platforms hold greater reach and influential power on travelers in comparison to static photos, as seen on OTA sites, such as with the case of Shangri-La Hotel Tokyo Virtual Reality Tour.
On top of new technology initiatives and communication channels, hotels are exploring new ways to integrate VR into their hotel to elevate the in-stay experience for the next-generation traveler.