Even in this strange and complicated year, some digital trends in the travel industry have emerged that are worth following to understand how business is transforming and how they need to transform, starting with the smart hotel room and ending with overtourism.
Needless to say, as we’ll see when analyzing the digital trends in the travel industry, digital transformation has radically changed the way people travel and how they conduct themselves as tourists, to the point that it is no longer possible for operators to avoid these considerations.
And although this has been a “complex” period as a result of the pandemic that has affected the entire world, the trend towards digitalization continues, with all that this entails.
Obviously, in this period, the speed and relevance of these trends has been less than in the past, if only because the movements and, consequently, the investments made within the sector have clearly decreased due to the contingencies.
This does not prevent us from making some considerations on the future of the sector and trying to imagine the features that will characterize its future.
We know that forecasts are always fallible – and right now they are more so than usual. However, we can still identify at least six interesting digital trends in the travel industry.
Travel industry’s first digital trend: Continued growth of digital
Although the first trend we are reporting on is not strictly digital, it concerns the entire sector and, as such, represents a sort of premise for all the others. And it’s not an insignificant trend, since it marks a very interesting fact, namely that digital transformation has given a considerable boost to the sector, which appears to be driven by its digital component.
While even 2019 showed general growth in the overall market, it should be noted that, at the beginning of 2020, the main increase in turnover was detected precisely in ecommerce travel, which totaled +9%, reaching 15.5 billion euros, mainly thanks to mobile, which, as we will see, is destined to have great relevance in the future.
This is because the spread of the internet is now an essential part of travel.
Just think about how often tourists use digital technologies to choose, book, and manage their trips.
It is precisely in light of this that we can understand why the digital sector of tourism has become equally relevant and in a sense “parallel” to the analog sector, not only for travelers but also for operators, who can no longer wait to develop and integrate customer-facing digital solutions into their businesses
Second digital trend in the travel sector: The digitalization of the experience
On closer inspection, it is precisely from the first trend that we can derive the second, namely that the tourist experience during travel is increasingly digital. Today, it is increasingly common for people to use digital tools and technologies to enjoy a better experience.
One example is the use of the smartphone, which is undoubtedly the ideal companion for every tourist.
Thanks to its multifunctionality, travelers use their smartphones for a range of different uses.
For example, 68% of Italian tourists look for information through their mobile device instead of using a computer or a tablet; for 42% of respondents, instead, the smartphone is essential for sharing their experiences on social profiles; finally, 38% use it to leave comments and reviews on dedicated applications and sites (statista.com).
On closer inspection, therefore, mobile is, and is destined to become, an increasingly important touch point for any operator who wants to reach potential customers.
It’s clear that smartphones have a formidable impact on the behavior of tourists and, above all, on their choices, from buying flights to booking experiences once they reach their destination. Consider that, in just 5 years, from 2015 to 2020, the number of American tourists who say they “always” use their cell phone when traveling has risen from 41% to 70%.
This data indicates one thing: Operators who want to be relevant in the market must think not only digitally, but above all “mobile first.”
Travel industry’s third digital trend: Hotels open the doors to digitization
If the second trend was mainly about tourists, the next trend mainly concerns travel operators.
Digital transformation has radically changed tourists and their expectations. At the same time, however, hotels have more tools at their disposal in terms of the increasingly sophisticated technologies that they can implement in their facilities.
The third trend is precisely this: more hotels are investing in advanced digital solutions to make their guests’ stay memorable.
We are therefore moving away from the purely digital dimension, also because the digital transformation also has an impact on physical places, which are being changed and modified by the players themselves, according to clear guidelines for both digitalization and simplification.
With that in mind, here comes the opening of the first smart hotel, where customers can open the door, adjust the temperature in their room, and even pay at the end of their stay, all with a simple tap on their smartphone.
Even a famous hotel chain like Marriott International has realized the importance of following this trend and has initiated a collaboration with Samsung and Legrand to create a smart room, equipped with the most advanced responsive IoT systems and devices, to make every experience as unforgettable as possible.
This type of technology will allow the guest to request, for example, virtual assistance to set the alarm clock, or to follow a yoga class through an interactive mirror, to customize the cleaning service, or even to operate the shower.
All of this, of course, can be done via voice command or using a specific application.
The Starwood chain is also following this digital evolution path, with the primary objective of “automating” certain processes, such as check-in, allowing guests to check in autonomously, once again using their smartphone, which is transformed into a “digital key” to open the room (digitalmarketingturistico.it).
Among other things, this type of transformation will allow hotel facilities to constantly improve their efficiency, learning directly from customer behaviors, which can be tracked, collected, and analyzed. In other words, the digital transformation of hotels puts them in a position to really take advantage of big data, which is increasingly important and relevant to the travel industry.
Travel industry’s fourth digital trend: Big data is welcome
The fourth trend in the travel industry is precisely this: the increasing use of big data and the consequent increase in its importance.
Digital transformation and the change in tourist habits, which increasingly involve the use of the internet and smartphones during travel, leaves sector operators with a huge amount of data at their disposal, which they can use in a variety of ways.
One way, as we have seen, is using it to improve the customer experience they are able to offer. By intercepting reviews left online, operators have a wealth of indicators about how and where to make changes to meet customers’ needs
Another way to take advantage of big data is competition scouting. By monitoring and analyzing the information available online, operators can understand and learn from the behaviors and strategies implemented by competitors.
Observing their strengths and weaknesses, detecting which aspects are most appreciated and criticized by users, their communication strategy, their way of addressing their audience: it is possible to do all this by collecting the right data, which is the necessary premise for drawing relevant conclusions about the changes to be applied to your business.
These are just some of the many ways that companies can use big data.
Fifth digital trend in travel: From big data to predictive personalization
The sophistication with which big data can be read is leading many in the industry to focus on developing predictive personalization solutions, which represents the fifth digital trend in the travel industry. The term “predictive personalization” refers to the ability of a system to predict the behavior of a certain category of users based on their past behavior.
This is typically done by the most advanced chatbots, which “converse” with users and are able to understand their needs and anticipate their future requests.
In the travel sector, this type of capacity is becoming increasingly important on a competitive level, but in a different way than in other sectors, since “personalized prediction” is becoming simultaneous with tourist behavior.
If you think about it, it’s rare for a tourist to buy the same flight or stay at the same facility, since, once there, that destination loses appeal, at least for a while.
It’s not like a restaurant or a regular store: for a hotel, for example, the current behavior is more important than past behavior, since the guest will most likely never return, thus not providing the facility with the opportunity to implement what they learned.
It’s the current stay that needs to be made special and memorable, not (just) the future one. That’s why predictive personalization for the travel industry is important, right from the moment of booking.
It is precisely based on search behaviors that the operator must be able to outline a profile of the user in front of him – as precisely as possible -in order to reach him with an offer that is as suitable as possible in terms of cost, facilities, and services. This is what predictive personalization is all about: giving the user the feeling of maximizing, in terms of the expected experience, their investment while choosing an offer.
From the operator’s point of view, it means being able to identify the amount that each potential guest is willing to spend and offer him a package that can meet his needs even before he expresses them.
Sixth digital trend in the travel industry: Between overtourism and undertourism
The sixth trend concerns two phenomena that, while not strictly digital themselves, their root cause is all digital.
For some time now, we’ve been hearing talk of overtourism, or an excess of tourists concentrated in certain periods of the year in certain areas, which would represent a real danger for the balance and sustainability of certain locations. But what does overtourism have to do with digital transformation?
It’s easy to trace the link if you think about how much social networks influence people when it comes to choosing a destination to visit.
Many people begin to dream about their next vacation starting from content posted on the social profiles of their acquaintances or connections. Econsultancy even talks about the “Insta effect,” since 40% of those under the age of 30 consider “Instagrammability” one of the important factors in choosing a trip (econsultancy.com).
So, it’s obvious that the more a destination is visited, photographed, and shared on social networks, the more other users are enticed to go and visit it, in an uninterrupted cycle that leads to overtourism, which is perhaps the negative consequence of the influence of social networks in the travel sector – which, by the way, can be considered another trend.
However, as it so often happens, the cause of a problem is also its solution. If digital transformation has favored this excess of tourists in some well-known locations, the web and social networks also provide an avenue for dealing with this phenomenon.
The opposite trend of undertourism, visiting less popular or undiscovered destinations instead of the classic and most well-known ones (ninjamarketing.it). This is confirmed by Booking.com, which found that 51% of users are increasingly looking for the so-called “next best place” to visit, those that are little known and far from the famous routes (wearemarketing.com).
To find such destinations, tourists turn to the Internet and social networks, which are now actual travel guides where it’s easy to find different trips and destinations that fit one’s needs and interests.
This means that even less “trendy” places can leverage the web to become relevant and, most importantly, attract tourists.
This last trend, also reinforced by COVID-19, sums up the impact of digital transformation on this sector.
As new solutions and new available technologies emerge, the paradigm of a certain business also changes; this can cause problems, some of which are not easy to deal with, but it also opens up new opportunities for growth and development, as long as you know how to adapt and learn to manage this transformation.