Across the world, the travel industry is in the throes of a massive transformation. Amidst a volatile macro-economic scenario, traveller preferences are rapidly changing. In addition, the industry currently faces inflationary costs, an acute shortage of skilled talent and is increasingly under scrutiny to adopt more sustainable and green ways of operating.

Even as these challenges persist, the industry, which includes aviation, hospitality, and travel services, can take heart in the fact that traveler sentiment remains upbeat. Months of being cooped up indoors during the pandemic has had a profound impact on consumers, reminding them that travel is more than just the trip. Instead, it is about forming human connection. An Industry Consumer Pulse Survey 2023, which surveyed over 10,000 individuals from 16 countries found that 71 per cent of consumers plan to sustain or increase their spending on leisure travel even as they consider limiting spending across most other discretionary categories.

We believe that travel businesses must build a strong digital core to not just stay relevant but also thrive in this scenario and prepare themselves for the next wave of disruption. A robust digital core is imperative to building resilient business operations, boosting employee productivity, tapping new revenue streams, and most importantly, creating memorable experiences for travellers.

There is no ‘one size fits all’ digital approach
As per industry estimates, global airline passenger traffic is estimated to touch 9.4 billion passengers in 2024. Every year, some of the world’s largest hotel chains offer over a million rooms to guests each, and some car rental companies operate a fleet size of over a million cars each. Given the large scale and complexity of operations, and the diversity of operating models, processes and traveler needs, there is no ‘one size fits all’ approach to building a strong digital core.

Let’s look at this in the context of hotel chains. While all hotels want to deliver great guest experiences, select-service brands prioritize efficiency, have minimal workforce, and rely heavily on standardised processes. As a result, they need a Software as a Service (SaaS)-based lightweight workforce management platform and strong operational insights to maximise efficiency. On the other hand, upscale luxury hotel brands tend to prioritize full-service offerings, well-trained staff, and personalized services. They would typically need a best-in-class workforce management platform along with strong data-led personalisation capabilities integrated into a comprehensive CRM solution.Hence, travel businesses must design and develop their digital core and technology strategy in line with their unique requirements. Interoperable platforms and modular systems, cloud-native operating models, a strong data foundation, artificial intelligence capabilities, and security embedded in everything are all essential elements of this strategy.

Cloud capabilities are vital
Travel companies need to build a solid foundation for change, using the cloud to drive resilience and future growth. The Cloud’s inherent on-demand variability and uninterrupted global connectivity enables businesses to handle surges in business demand. A case in point is how Taylor Swift’s ‘The Eras Tour’ catapulted the demand for airline tickets and hotels in cities on the tour circuit. In situations like this, pricing systems need to be agile, capitalize on the demand, and swiftly distribute new rates across the sales channels. Similar nimbleness is also required during phenomenon like the volcanic ash clouds that can completely upend flight schedules at a very large scale. These situations need enhanced compute power and low-latency connectivity that the cloud offers.

Data-led and AI-powered travel operations
Travel businesses are no stranger to AI adoption – they have been applying AI to growth, experience, and productivity related use cases for some years now. It has been proven that leveraging AI at scale can help create personalised experiences, anticipate travelers’ needs, provide real-time assistance, and help travel companies streamline their operations, empower their employees, and reduce costs. The addition of generative AI to the mix has only given a fillip to AI adoption. Generative AI can help travelers curate a perfect family holiday itinerary, enable an airport manager draw up numerous ‘what-if’ scenarios for gate assignments during heavy snow, and assist with optimal staff allocation.

To tackle the unsustainable aspects of tourism, all stakeholders in the ecosystem must collaborate. Travellers can adopt mindful consumption habits. Local authorities have the power to incentivise eco-friendly businesses, while tour operators can educate tourists on the environmental impact of travel choices. Creating comprehensive environmental planning and waste management for eco-sensitive tourist destinations goes beyond strategy.

A recent industry research found that AI-influenced revenue for travel companies more than doubled between 2018 and 2021 and is projected to triple by 2024. However, only 13 per cent of surveyed travel companies used AI to reinvent core parts of the business, which indicates the tremendous potential for AI adoption.

In order to capitalise on this opportunity, travel companies must put in place the right data and AI strategy, infrastructure and platforms that govern how data is captured, managed, processed, and how insights are visualized and consumed. Robust data governance, responsible AI practices and in-grained security are vital. Equally key are building data, digital and cloud skills in the workforce supplemented by new operating models, and data-driven ways of working.

Elevate the Purchase Experience
To appeal to today’s traveller, their omnichannel experience – be it through the web, mobile app or call center – during browsing and booking must be seamless, intuitive, stimulating and personalised. Organisations must focus on transforming their sales channels and offering differentiated product and experiences that deliver value across the customer journey.

While the travel industry has faced many a curve ball over the years, it has successfully reinvented itself time and again. Reinvention, however, is a continuous process, and having a strong digital core is vital to building resilient and future-ready travel businesses and creating outstanding experiences for travellers.

The author is the Managing Director and Lead for Travel industry, Advanced Technology Centers in India, Accenture.

DISCLAIMER: The views expressed are solely of the author and ETTravelWorld.com does not necessarily subscribe to it. ETTravelWorld.com shall not be responsible for any damage caused to any person/organisation directly or indirectly.

Join the community of 2M+ industry professionals

Subscribe to our newsletter to get latest insights & analysis.

Download ETTravelWorld App

• Get Realtime updates
• Save your favourite articles

Scan to download App