Digital transformation of the tourism industry
PRACTICALLY every industry has been affected by the advent of the Internet and digitisation and the tourism industry is no exception. Perhaps that is why the theme of this year’s World Tourism Day is “Tourism and the Digital Transformation”.
Tourism is a major economic sector for many countries with benefits to both the host communities and the destination country as a whole. In 2017, international tourist arrivals reached a new record high at over 1.3 billion according to the United Nations’ World Tourism Organisation. It reports that the tourism industry has now seen uninterrupted growth in arrivals for eight straight years and in 2017 it supported some 313 million jobs or one in 10 jobs globally.
Here are some digital and Internetrelated trends that is fast changing and shaping the tourism industry of today and tomorrow.
Sharing economy
The World Bank Group recently published two reports on the significance of digital transformation on tourism. One of the reports titled Tourism and the Sharing
Economy is about the rise of peer-to-peer (P2P) businesses like Airbnb where ordinary folks can open up their homes for short-term rental by guests.
This phenomenon has totally disrupted the accommodations industry — including hotels, bed and breakfasts and hostels. Not only do travellers find this approach cheaper but in some cases they feel there is more character in actual homes than a hotel room. In some key cities, Airbnb has even launched a feature that allows hosts to not only provide accommodations but also to create experiences around the city for their guests.
This is a trend that will only continue to grow. According to the World Bank Group report, the annual growth rate for the global P2P accommodation is estimated at 31per cent between 2013 and 2025, six times the growth rate of traditional accommodations. Meanwhile PriceWaterhouseCoopers estimates that by 2025, the sharing economy’s revenue will be a whopping US$335 billion (RM1,389 billion)!
uSer-generated content
The World Bank Group’s second report, The Voice of Travelers, which was produced in collaboration with TripAdvisor, highlights how peer reviews and other forms of usergenerated content (UGC) hosted on digital platforms have grown to become the most important sources of travel information globally — more important than materials produced by tourism boards and other traditional outlets.
People trusts the views of fellow travellers and check out what their friends are saying on social media as well as what strangers are saying on UGC websites like TripAdvisor and Yelp for travel reviews.
Consumer’s reliance on user reviews has one very good side effect. Hotels and restaurants are focusing less on branding and marketing, and more on customer service because they know if that is lacking, it will show up on TripAdvisor and Yelp. They know they can have the best advertising, promotion and marketing campaigns in the world but if customers have poor experiences there, they will get bad reviews.
mobile focuS
People are used to doing many things on the web but increasingly this is done on their phones, not their computers. Mobile Internet is no longer a companion to desktop Internet. For many, it’s the main way they get online. This realisation has led many companies to not only create mobile sites but to have mobile apps that allow them to easily research information, make bookings and transact payments. In fact, with apps almost anything is possible. Customers can order room service and even unlock their doors using dedicated apps.
Of course the older generation would general prefer to use a desktop or laptop computer to do things because they prefer a big screen. But for millennials, they are used to doing everything on their phones. They read, listen and watch things on their phones. It doesn’t bother them that the screen is tiny. In order to reach out to this generation, companies will increasingly need to have a mobile-first or even offer some mobile-only services.
Virtual reality
Before the Internet, the only way someone can see what a hotel, a museum or a tourist hotspot looks like in another city, state or country, would be through pamphlets, brochures and books. Later, the Internet offered websites that can deliver pictures and videos of these places. Today, it’s possible to have an even more immersive experience through virtual reality (VR).
VR could be used to offer potential visitors a taste of what the can expect — a sort of preview of their intended trip. Or it might even be a way for some to “experience” the world without having to fork out a mini-fortune to do so. Granted, a VR trip to Europe is not the same thing as actually being there but it’s a lot more immersive than just seeing pictures or videos of those locations. And as VR improves, the experience will become more and more realistic.
perSonaliSation
If there’s one thing the Internet is really good at, it’s personalisation. Whenever you visit a website or a social media page or use an app, data is being collected on you and your activities. Your online behavioural patterns can be analysed to deliver you a more personalised experience the next time you visit the page or use the app.
E-commerce companies have known about the importance of personalisation for years. Amazon is an expert at this. That’s why each time you visit Amazon, it gets better and better at offering you products that you are interested in.
Tourism-related companies are starting to come around to this too. Qantas, for example, has created a data hub centred on customer preferences and behaviours to improve customer experience. Its inflight entertainment and services, as well as real-time ticket booking and check-in processes, are more personalised.
But this is just the beginning. Imagine the personalisation possibilities that can be achieved through a smartphone app with artificial intelligence capabilities. It can act as a personalised travel companion that anticipates your every need based on its understanding of your preferences.