The adoption of information and communications technology (ICT) solutions has enabled the travel and hospitality sector to re-engineer its core offerings and scale up operations. These cutting-edge technology tools, including internet of things (IoT), artificial intelligence (AI) and big data analytics, have helped enterprises to deliver a personalised experience to customers in line with their changing digital needs. Further, they have altered the ways in which these enterprises identify and acquire new customers and promote brand loyalty. Going forward, the beginning of the 5G era will scale up technology adoption in the sector. A look at the key technology trends that are set to reshape the dynamics of the travel and hospitality industry…
The adoption of IoT solutions has revolutionised the day-to-day operations of travel and hospitality enterprises. By connecting smart devices, systems and processes, IoT-enabled connected devices ease guest experiences and enhance hotel efficiency. To this end, in-room tablets based on IoT have enabled guests to personalise their rooms by adjusting room temperature and lighting, scheduling wake-up calls, etc.
IoT can also be used to ensure effective predictive maintenance. For instance, IoT-based air-conditioning systems can send an alert to the hotel staff in case of a breakdown and the problem can be fixed while the guest is away. Hospitality businesses such as restaurants can also deploy IoT systems for better inventory management.
AI-based solutions are helping travel companies provide tailor-made services to customers. To this end, deep-learning algorithms facilitate analysis of past behaviours in predicting future purchase actions of customers. Machine learning and AI can also be used to understand customer behaviour over a period of time. This helps in creating unique content and solutions. Further, AI-based digital mediums such as chatbots have opened up new avenues for taking customer experience to the next level. These chatbots act as a conversational interface to support the work that was typically done through call centres earlier. The use of these conversational platforms helps take care of a traveller’s post-booking needs.
Chatbots are already helping airlines and online travel technology companies to handle some of their online services such as customer booking transactions and boarding passes so that human travel agents can focus on more complex interactions. Among enterprises, Yatra.com has launched a Facebook chatbot to enable ticket booking; a self-service platform to address customer queries; and a marketplace chat platform to enable travellers to chat in real time with the sellers. Goibibo and MakeMyTrip also use customer-facing AI platforms called Gia and Myra respectively.
Big data analytics
Travel and hospitality enterprises generate huge amounts of data throughout a traveller’s journey. This data is crucial for hotels, travel management companies, online travel agents (OTAs), airlines and metasearch engines. The use of big data analytics enables enterprises to leverage the data generated throughout the value chain to gain insights for improving customer satisfaction and optimising operations. These players use big data analytics to improve and personalise customer experience, employ dynamic pricing for value maximisation, predict future demand scenarios and prepare for them, optimise operations, and channelise marketing efforts in order to achieve targeted responses. During the past few years, airlines have also started using the data they collect on a regular basis to design targeted marketing campaigns, provide personalised offers, and predict demand to maximise revenues through dynamic pricing.
Big data analytics has helped in driving the growth of the online travel industry by allowing enterprises to cater to the unique needs of customers. Due to constantly evolving traveller preferences, analysing traveller behaviour becomes difficult. Big data analytics resolves this problem by studying travel behaviour and accordingly customising the entire vacation of customers. For instance, Yatra. com is using big data to encapsulate the wide range of traveller preferences and offer an ideal vacation. The data points of different users are mapped to understand their preferences. Through the data gathered, the company is able to provide users easy access to recommendations on hotels/flights, etc. that are within their budget range.
Upcoming technology trends
Several upcoming technologies are offering immense opportunities for modernising operations in the travel and hospitality sector. These include robotics, virtual reality (VR) and blockchain.
Hotels and restaurants around the world have started using robots as helpers. From an all-robot staff hotel in Japan to a robot concierge at Hilton, robots that serve guests are emerging as the next big trend in the hospitality industry. Robots are increasingly being used in restaurants too – for preparing meals, taking orders and even delivering food.
VR also finds many applications in the hospitality industry. An average customer needs a huge amount of information before actually booking a hotel room. VR enables enterprises to offer customers an immersive experience of the hotel rather than a written description.
Blockchain is another technology that offers several advantages for the hospitality industry. Key among these is higher security for conducting financial transactions. For instance, all data encrypted in blockchain solutions is decentralised and traceable, and the database can never go offline or be removed through a cyberattack, which helps in securing financial transactions. In addition, blockchain can play a vital role in simplifying payments, especially in dealing with overseas settlements, which is currently a complicated process. Blockchain can also ease the process of accessing and storing information, thereby improving the overall travel experience of customers.
While the uptake of ICT solutions by travel and hospitality enterprises is on the rise, some challenges remain. First, India still lags behind in terms of availability of digital infrastructure, which is essential for scaling up ICT adoption among enterprises. Second, several major players in the travel and hospitality sector cite payment issues as one of the pressing problems that hinders digitalisation. The issues concerning payments include the lack of integration between the payment systems of banks, mobile wallets and merchants; high cost of digital transactions and the lack of facilities for foreign currency payments. At present, enterprises in the travel and hospitality sector have to maintain a large number of individual partnerships for facilitating online payments. To this end, a seamless and transparent payment ecosystem that can help reduce the number of such contracts is crucial for the increased adoption of digital payments.
Another major challenge in the growing ICT uptake is the risk to data security and privacy. The travel and hospitality sector has accumulated a large amount of data comprising personal information of travellers, financial transactions and customer behaviour that can pose data security and privacy threats. In order to protect this data, enterprises need to take stringent security measures that can prevent cyberthreats including phishing attacks and espionage.
The way forward
Challenges notwithstanding, the travel and hospitality industry is poised to emerge as one of the leading sectors in terms of technology adoption. The beginning of the 5G era and its associated technology disruptions are going to pave the way for smart and innovative tourism. This form of digital tourism would comprise innovative offerings such as augmented reality city tours, VR-based experiential booking support robots for security and housekeeping, smart luggage, radio frequency identification (RFID)/facial recognition technology to open hotel doors, RFID-based luggage tracking for air travel, driverless/self-parking cars and air taxis. The launch of these innovative solutions is going to create a larger than ever digitally connected ecosystem for the modern day traveller. s
Kuhu Singh Abbhi