How Digital Transformation Impacts the Travel and Tourism Industry        

How Digital Transformation Affects the Travel and Tourism Industry?

How Digital Transformation Affect the Travel and Tourism Industry

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Digitalization

Like every other industry and human activity across the globe, even travel and tourism industry have been changed with the advent of digitalization. The ways in which these two sectors have been altered by digitalization are diverse and manifold. Digital transformation of the travel and tourism industry has drastically cut down the need for manual intervention at the various levels. It has made the whole cycle of planning, booking and travel which involves the customer, into a process which is faster, cheaper and more convenient.

Only as recently as a couple of decades ago, for majority of travelers across the globe, booking an air or train ticket would have meant standing in a queue for a lengthy period of time. Along with this being time consuming, even the ticket costs were comparably higher and the facilities during the travel were minimal. All of this changed with the intervention of digitalization of the travel sector. Today, the entire procedure of booking can be done within seconds with a few taps on your mobile screen. Travel and tourism industry was one of the earliest industries to undergo transition due to digitalization and these changes have continued unabated till date.

In the varied scenario of the travel industry, Gen Z and Millenials have been prominent participators. The new generation is cued into the technological developments in a lot more pronounced manner than their seniors from an earlier generation. They have embraced the latest switches brought by technological advancements and are driving further enhancements in the field.

According to the World Economic Forum’s Digital Transformation Initiative (DTI), from 2016 to 2025, digitalization in aviation, travel and tourism is expected to create up to US$305 billion of value for the industry through increased profitability, migrate US$100 billion of value from traditional players to new competitors, and generate benefits valued at US$700 billion for customers and the wider society.

In 2016, for the sixth consecutive year, the travel and tourism sector’s contribution to world GDP outpaced the global economy, rising to a total of 10.2 per cent of world GDP (US$7.6 trillion), according to the World Travel & Tourism Council.

Trends To Take Notice

#1.Mobile Accountability

As the Travel Flash Report by Criteo informs, over 1/3 of the world’s population use a mobile device to book a hotel room. Mobile connectivity is something that most users readily expect when they travel. Most hotels, restaurants and airports offer Wi-Fi connections today.

Some establishments are upgrading further on mobile connectivity. For e.g., Casuales Hotel chain offers a Mobile Pack Service which includes a device with a Wi-Fi connection, a portable battery along with a selfie stick. This set is free for customers who book directly on the hotel’s website.

Such a package enables users to share their experiences over social media during their travel and stay at the hotel and goes a long way in enriching the customer experience. Customers expect seamless mobile connectivity during all stages of their travel and even later when there are post-travel special offers.

Thus, nowadays mobile connectivity is a requirement and not a luxury.

#2.Sharing Economy

Travel industry is founded on the principle of connecting people and places. Going further, making the tourists’ experience a memorable one and make them carry a lasting impression of the places they have visited is primary concern of the service providers. One significant development of digital transformation impact on tourism is the explosive growth in the sharing economy industry.

Sharing economy involves sharing of products and services with the aid of internet. In the travel industry, this includes sharing of rooms and car-hire services. By allowing residents to share spare rooms with visitors who are new to the place, the facilitating service provider helps the visitors enjoy a homely accommodation. The customers are sure to enjoy such a provision and be grateful to the service provider.

When it comes to taxi-hiring, the cab driver could transport multiple parties who are headed to the same destination with mutual consent of the passengers. This results in cost-cutting for all three involved: passengers, drivers and the cab service company.

#3.Omnichannel Sales Model

These days, tourists spend considerable amount of time in planning their trip and they do it with care and caution. It is no wonder that they expect the best of facilities and full value for their money.

Customers expect services to be available to them on several platforms and 24/7. They seek information over their mobiles (apps), desktops (website), interaction with personnel – both over the phone and in person and over social media platforms. This naturally calls for the people in tourism sector to be all eyes and ears and to be at the beck and call of their clients. After all, it is as much their duty as their professional need to keep their customers happy, informed and content. Thus, the omnichannel sales model is the way forward and to run such a channel demands judicious planning, foresight and execution skills from the individuals in the travel industry. This is another way in which digital transformation has impacted tourism industry.

#4.Customer Experience

The experience you provide a customer can make or mar your reputation. This is of prime importance since news travels fast these days – all thanks to internet and social media. That is the reason why the hotels and restaurants have been extremely fastidious to ensure that they provide the best form of customer service. The hospitality industry realizes how vital the quality of customer service is in safeguarding and building their reputation. This is another way in which digital transformation has impacted tourism and travel industry.

#5.Personalization of Services

In every business, customers like to be made needed and wanted. Personalization of services is one common and simple way to do so. With the aid of data analytics and cloud computing, travel industry has been able achieve personalization and come up with offers which are suited to a customer’s expectations. And through mobile apps and notifications, travel companies can engage with their customers regularly and also gain valuable insights into their preferences and choices. Personalization is bound to assume greater importance in the future as supplying relevant information and content with the aim of enhancing the user experience becomes a major objective of the travel industry.

#6.Virtual Reality Assistance

Through VR, customers can don a headgear inside their home and take a virtual trip to their preferred destination, get a feel of the place they are planning to visit, check out the hotels where they intend to stay, restaurants where they want to dine and find out about the cab services they want to hire. All this can be accomplished without stepping out of their homes.
This technology may not yet be prevalent but it is so beneficial that it is fast becoming a popular trend in the tourism and hospitality industry. Like in a lot of other fields, VR is taking rapid strides and making a mark in the travel industry too.

#7.Cognitive Computing

In the not too distant past, what can be achieved through cognitive computing may have looked like a matter of science fiction. Not anymore.
Through cognitive computing, you can have a computer guiding you through a prospective travel destination of your choice and book your entire trip including the hotels for your stay, renting the cars and mapping the places which you may like to visit. This is done based on your previous travel experiences and the information you provide of your likes, preferences and dislikes. Computer uses this information to predict and forecast what an ideal travel destination for you could be. It is very likely that not only would you be free of the headache of deciding upon where to go but you may end up being spoilt for choice – all thanks to cognitive computing.

#8.Travel Automation

This is the step where various stages of your travel which can be cumbersome and time consuming are made simpler and quicker. Through automated facilitation, tourists could have their booking of tickets, check-in at the airport done online and with their boarding passes stored on their smartphones. It could also include smart visas and other documents related to security check-ups at arrivals and exits presented through mobiles. This can make the travel experience pleasant and the job of security officials a lot easier.

#9.Creating Employment

Travel and hospitality industry are huge businesses and account for a major share of the total jobs available everywhere across the globe. While digitalization will reduce manual labor at several points, it can also create new jobs. There will be a requirement for people who are qualified in soft skills and are digitally literate.

Conclusion

Travel and tourism industry has always been receptive to accommodate relevant developments in technology. Digital transformation impact on tourism has been profound and all-pervasive. It has made the travel industry more dynamic and user-friendly. Along with the technological progress, the tourism industry too has kept evolving and it has been only for the better. Gauging by the rate of changes, what we have witnessed so far may only be a small part of an emerging larger and a lot more colorful picture.

 


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