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digital transformation in travel sector

Digital transformation in the travel & tourism sector: 3 trends that travel marketers need to know

Tourism is a profitable and growing industry that is experiencing continuous change, thanks to digital transformation. Here are three trends that will inform your marketing and customer strategy in 2019.

Tourism is a major global sector. The number of travellers is impressive and growing all the time. According to the latest data from the United Nations World Tourism Organization (UNWTO), there were 1.4 billion tourists in the world in 2017, an increase of 7% annually. This is significant growth, especially if you consider the growth over time: 1990: 400 million, 2000: 700 million, and in 2010: 900 million.

In light of this data, the words of Zurab Pololikashvili, Secretary General of the UNWTO, are appropriate: “The growth of tourism in recent years confirms that the sector is now one of the most powerful engines of growth and development worldwide.

If we focus only on Europe and Italy, the trend remains the same. In 2017, 617.7 million tourists arrived on the continent, up 8.4% compared to 2016. In Italy, there were 122 million foreign visitors in the same period (+ 4.5%), and more than 427 million total travellers (+6.0%) according to ISTAT data. The average expenditure of foreign tourists was €39 billion, an increase of 7.7% annually, with a positive trend on both the leisure and business fronts.

In other words, tourism is a very healthy sector and one where there are still many opportunities for improvement. It’s also a sector that, on the wave of digital transformation, has undergone many radical changes, especially in terms of operators and travellers in recent years.

 

The impact of digital transformation

For one, tourism is no longer only for the wealthy. For another, the sharing of information—about the best accommodations, the best restaurants, the must-see destinations, the can’t-miss experiences—are no longer limited to books or simply word of mouth. It’s true that some dynamics of travel have stayed the same—how we prepare for a trip, the fact that we still want recommendations from those in the know—and those have also been impacted by technology.

Today, websites such as Tripadvisor, Booking.com, and Expedia are overflowing with useful reviews to guide our choices. There are blogs dedicated to travel (large or small, institutional or independent), there is “user generated content” (more generally), marketing based on influencers. There are also a huge number of apps aimed at the sector. And, we all have smartphones that allow us to capture memories and take pictures that we can share in near real time to share with potentially thousands of people on social networks. There are also new frontiers already on the horizon that include the use of wearable devices.

The area of potential is broad and complex, and it is all accelerated thanks to the internet and digital transformation, with no hint of slowing down.

Those who are involved in marketing in the Travel & Tourism sector know exactly what we are talking about.

In this post, we will identify three main trends that are the key points of the change that we see on the horizon in this area. These trends are already underway, and they are unstoppable—therefore, they are trends that you won’t want to ignore.

 

1. First and foremost: customer experience

“The real voyage of discovery consists not in seeking new landscapes, but in having new eyes.” wrote Marcel Proust, brilliant author, who was part of that aristocracy of travellers of the last century.

This famous quote is more relevant than ever in today’s travel and tourism industry, and it is reflected in one of the main trends identified by all the experts and observers of the sector: that of the centrality of the experience of the traveller. In short, customer experience often becomes even more important than the destination itself.

Consider these findings:

  • Let’s start from the importance of the word “experience:” in May 2018, TripAdvisor made a significant rebranding decision to change the name to its department “Attractions,” to “Experience” (see here).
  • On Tripadvisor, in 2017 alone, operators added 30,000 new “experiences” to the portal, thus increasing its total number by about 50% (see here).
  • According to data provided by Airbnb CEO Brian Chesky, three out of four millenials say that they prefer to buy an experience rather than a physical asset (see here).
  • Mark Okerstrom, CEO of Expedia Group, revealed that the company generated more than $500 million in 2017 through its “Things to do” and “Local Expert” sections; translated: $500 million in a year for “experiences” (see here).
  • Let’s look at luxury hotels. Here, the attention to the quality of the customer experience is always at a maximum. But in recent years, more and more hotels of this type have used in-house specialists to offer guests tailor-made experiences (see here).

 

2. Be there 24/7, and in omnichannel mode

The tourist experience begins long before the actual journey and ends long afterwards.
Many travellers will spend a significant amount of time to research the destination and request and compare the information. Afterwards (and even during a trip), many travellers will take the time to share their opinions, feedback and reviews on their experiences

These are some of the most important and complex periods for those working in marketing and customer care in the tourism sector

What is certain is that the customer expects companies in the sector to be “always on” and to be responsive 24 hours a day, 7 days a week. They also expect to be able to interact in an omnichannel perspective that minimizes the touchpoints necessary to communicate. This includes via mobile (above all) and via desktop; through dedicated applications (especially those with an efficient help desk and messaging system); via social networks. Booking.com, for example, found that about 80% of customers prefer to obtain the information they need on their own.

According to a recent Google survey, more than 70% of U.S. travellers “always” use their smartphone to search for activities and experiences in their travel destination to locate attractions, clubs and restaurants, and to get directions.

Proof of the importance of an omnichannel approach is the use of voice assistants. Up to 70% of the requests received by Google Assistant are expressed by voice (source); this is a trend that sector operators cannot ignore.

 

3. The frontier of personalization

The types of trips and experiences that travellers are looking for are increasingly tailor-made. Blanket loyalty to the same brand, the same hotel, the same restaurants, and the same destinations is disappearing. Moreover, tourism is no longer concentrated in certain specific periods of the year and only in certain places. Also, the reasons why people travel, and how they do it, have multiplied.

In short, in this area more than any other, consumers are increasingly “faithful” to their needs; they want to live tailor-made experiences, and they want to be treated as unique individuals according to their needs and their individual characteristics, not as just one of many travellers.

In conclusion, we should keep in mind this detail, which emerged from an analysis by Google: 57% of travellers think that brands should customize their shopping experience and interaction with the user, based on their personal preferences, the behavior profile, and individual characteristics.

That’s why, according to Skift, customization will be the most disruptive trend in the Travel & Tourism industry in the coming years. The one on which everything will be played.

 

Learn more about personalization, user-directed storytelling, and advanced analytics. Learn more about Doxee Interactive Experience:  

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