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Artificial Intelligence Will Change the Travel Industry Forever

When we think of artificial intelligence, it’s easy for our minds to rest on those eerie dystopian blockbusters you see at the movies. In the Hollywood version, life with AI is the end of life as we know it, evil computers are ruling the world. Except it doesn’t have to be like that. In many ways, it seems like AI has got a bad name before it’s even got off the ground. That’s why today we thought we’d take a closer look at AI and its potential applications in the travel industry.

What is Artificial Intelligence?

That’s actually a pretty complicated question. In general, a computer with AI is seen as being able to take on tasks that would normally require human intelligence. ‘What’s so special about human intelligence?’ you might ask. Well, it usually consists of essential skills such as learning, reasoning, perception and the understanding of natural language.

Before we get bogged down in the philosophy of what constitutes artificial intelligence, let’s just not even go there. Let’s instead consider how a computer program capable of, say, learning, reasoning and effectively communicating could be applied in the travel industry…

Take a step back and consider the main challenges that startups in the travel industry face at the moment. These include attracting the next generation of travellers, retaining those customers, competing with established names in the industry and much more besides. And how are these challenges being taken on? Well, many startups are relying on the quality of their product and customer experience to shine through, others are employing the latest marketing and social media techniques to get ahead; some are targeting and communicating with their customers in unprecedented ways.

All of these elements, from marketing to customer service, experience and retention, could all be impacted by AI in the near future.

In the travel industry, every stage of the customer cycle contains data points that can be stored and analysed by artificial intelligence. Patterns can be established and acted upon. These include qualitative information such as the motivation for travel and numerical data like the booking date, along with personal information from birthdates to primary language and marital status. Trawling through all of this and coming up with valuable insights for travel agencies can be a daunting task, but intelligent algorithms can analyse them with ease.

In theory, having access to all of this data and the power to analyse it should give travel brands actionable insights into the effectiveness of marketing campaigns and information on how to target certain demographics. It can also be part of an automated system that’s programmed to do certain things independently throughout the booking process and beyond. Let’s take a closer look.

The hotel industry’s automated future

A recent report from Skift, titled ‘The hotel industry’s automated future‘, outlines the role that AI could play throughout the customer journey with hotels and travel platforms.

To begin with, there’s marketing and outreach. With huge amounts of data on previous customers and travel trends, AI can easily spot patterns in booking behaviours and highlight how and why certain demographics book the trips they do.

This information can allow travel companies to tailor their outreach going forward, for example by going through a specific customer’s preferred digital platform with messages that have been proven to resonate in the past. There are obvious benefits to taking this kind of targeted approach. Instead of trying to appeal to the majority or flying blindly with broad marketing and outreach campaigns, travel brands can save time and resources by working smarter.

If automated, this kind of outreach could target a customer that booked a trip in May last year through a tablet in response to an email offering a discount. That same sequence of events can be set in motion once again, automatically, making the same end result far more likely.

It goes without saying that this will save travel brands time and money on big marketing campaigns and instead shifts the focus of their efforts toward each individual.

If this all sounds a bit heartless and devoid of genuine connection between travel provider and traveller, the key takeaway from the report is that AI combined with a human touch offers the best of both worlds. An example of this would be upsells offered to guests during the check-in process at a hotel. Armed with data saying that a family of four is arriving and has previously booked adventure activities, a hotel receptionist can offer trips nearby that fit the mould. These personal touches are based on data gathered prior to the meeting but come across as genuine, enhanced customer service.

Cendyn chief sales and marketing officer Tim Sullivan points out the following: Brands offering upsells and extras en masse to potential customers could be alienating them before a booking has even been made. Why are you offering a childcare discount to a young couple on a romantic holiday? “AI doesn’t mean humans can be totally hands off,” says Sullivan. “The promise of this technology is about man/machine symbiosis. Using the massive computational power of artificial intelligence to enable humans to be more efficient, productive, and insightful.”

Customer service, revolutionised

We can’t have a conversation about AI in the travel industry without considering the way it could impact customer service in the near future. Marketing is one thing, but is it realistic to expect complex interactions to take place between traveller and computer in a travel setting?

The short answer is yes. Smart personal assistants such as Microsoft’s Cortana and Apple’s Siri are growing in popularity. And they are doing so because they work. They offer insightful and relevant information, more often than not directly related to your query. In a travel setting this kind of assistance can be convenient and vital, whether you’re looking for directions, restaurant recommendations or things to do nearby.

Did you know there’s a hotel in Japan that is fully-staffed by smart robots? In theory, from check-in to room service, AI-powered machines could take care of the menial tasks, leaving humans to offer more bespoke and personalised customer service than ever before.

Is AI and artificial intelligence going to benefit travel?

If the bartender knows what drink you’re going to order before you’ve even arrived, is that wonderful or creepy?

The obvious advantage that AI can bring to customer service is the notion that intelligent computers will be able to predict what you want before you want it. They can then ensure that a.) it’s ready for when you eventually request it, or b.) make it available before you even ask. This could apply to anything from towels to train tickets.

Smarter CRM

CRM stands for Customer Relationship Management. Could the power of AI boost loyalty for travel brands? Well, if we combine elements of the two areas we’ve covered so far, marketing and customer service, it quickly becomes clear that the answer is yes.

Customer Relationship Management, at least in the travel industry, is all about data. To develop long-lasting relationships with clients and travellers, tourism operators need to know as much information as possible about customers. This data could cover everything from their age, gender and dining preferences to their interests and profession.

All of this information can be used during a customer’s trip to keep service at extraordinary levels, as well as being applied between bookings to lure travellers back in the right way. Artificial Intelligence has the potential to make this possible with a few simple clicks with a mouse. CRM managers will have never had it so good!

AI promises to bring to light valuable insights and patterns that travel operators will never have had before. This, in theory, should lead to improved customer service, better quality marketing and a boost in loyalty to brands who apply this wave of information in the right way.

There is a wrong way to harness AI

With great personal data comes great responsibility. Travel operators will need to find the right balance between predicting and tracking customer behaviour in a way that makes their experience more positive on the one hand, and coming across as digital stalkers obsessing over tiny details of irrelevant information. They key will be in how things are presented. Sure, a hotel guest might be interested in a return visit to the spa for a discounted price. But they won’t want to be reminded at what exact time they visited before, or how long they stayed in the jacuzzi for.

The Travel Industry Must Adapt for Generation Z

Do you remember what kind of things you did for entertainment when you were younger? Take a moment to think about how you spent your free time as a teenager. You probably read books, played outside, made entertainment from nothing at all. And why? Well for one thing, the internet likely wasn’t in existence/a dominant source of entertainment in your home. Times were different, the digital world we know today was only just kicking to gear, and the result was a notion of self-entertainment that relied heavily upon imagination.

So how is this relevant to the travel industry, and where does the concept of imagination come in? More on imagination later. The main point we’re trying to make is that the young people of today are different. They’ve grown up in times of incredible technological advancement. And as their power as travel purchasers looms on the horizon, it’s becoming more and more clear that their behaviour, attitudes and expectations are completely different to generations of years gone by. Sure, every new generation has its quirks, but as the focus shifts from millennials to Generation Z, travel operators will need to adapt for this emerging customer base more than you might think.

Technology: A challenge and an opportunity

generation z travel industry

The relationship between Generation Z-ers and travel is and will be linked by technology. As a generation that’s grown up alongside rapid advancements in all things tech, the connected world has certainly left its mark. Teenagers today are the most tech savvy generation around. On top of that, having grown up in the immersive world of social media, advanced video games and platforms such as Youtube, this is a generation that takes technology and innovation for granted. For teenagers all over the world, these incredible advances have been a part of their lives for as long as they can remember. The digital world that they spend so much time in is all they’ve ever known.

Attention spans are at an all-time low – just eight seconds for Generation Z-ers according to some research. This means that things happen quickly. Content is engaged with and judged in a flash. Generation Z has been exposed to and shaped by the concept of instantaneous results and reactions. Just look at Snapchat, along with the growing popularity of memes and blink-and-you’ll-miss-it video content on platforms such as Facebook and Youtube.

But that’s not to say that the teenagers of today are a bunch of mindless kids who can’t focus on something for any longer than a goldfish can. That would be completely the wrong way of approaching this and missing the point entirely. This is instead about Generation Z’s ability to process information:

Mimi Turner, marketing director at The Lad Bible said the following:

“People talk a lot about this generation having a short attention span. That’s exactly what grown-ups say when they don’t understand something. This audience are extreme navigators of superior efficiency. They are machines at knowing what they want. They are highly sophisticated decision makers. They are efficient and marketers and brands need to catch up with that.”

Imagination and travel

In the opening to this post, we touched on the importance of imagination to the travel industry. Travel is, of course, driven by ambition, by a passion for exploration and a desire to experience new places. The imagination is where all of these wonderful emotions collide to form concrete goals that can be aimed at and aspired to.

The digital natives of Generation Z are set to have an intriguing relationship with travel and imagination. On the one hand, the next generation is touted as being more globally-minded than even Millennials. This suggests that travel will be a priority. But having said that, there’s an argument that the close relationship with technology we’ve talked about could be a barrier to those travel aspirations we currently take for granted.

“Only daydreaming while waiting for devices to recharge”

Why could this be? For starters, take a moment to appreciate how immersive and all-encompassing the digital world of technology is becoming. With the latest games, you can already explore the world (and beyond) in high definition with your friends by your virtual side. Technology isn’t (yet) an adequate substitute for the real thing, but how many teenagers are spending their days gazing longingly at pictures of Paris or Rome or New York instead of entertaining themselves via different means? The short answer is not many. You might even say there’s so much damn entertainment around that travel will fall down the list of priorities. After all, if you can have fun, a social life and experience new things through a screen does often expensive travel take a backseat?

Speaking with Campaign, Gerry Whiteside, co-director of P2 Games neatly summarises this debate. Previous generations have seen our imaginations shaped through books with a beginning, middle and an end. The infinite nature of the internet is both an opportunity but also pretty darn frightening. As Whiteside says, “There is a fabulous opportunity for children to be more creative as a result of technology. But I also have a feeling that whenever their device’s battery runs out, the next generation will only find time for daydreaming while waiting for it to recharge.”

Generation Z is coming – Is the travel industry ready?

In the next year or so the first members of this generation are going to be in a position to make travel decisions and exercise their enormous spending power around the world. So what does this tidal wave of tech-savvy youngsters mean for travel operators? And how can services and offerings be adapted to connect with the most connected generation ever?

Clearly things need to change. In a recent piece in Travel Weekly discussing how to make travel products appeal to the next generation, Miles Morgan admits that “As an industry, we have one of the most engaging products – holidays and holiday destinations – but we fail to cut through and engage people enough to grab their interest.”

The way we see it, there are two ways that travel operators can switch things up to appeal to younger customers. The first involves the way that products are marketed, and the second the medium through which that marketing happens. Now, that may sound like the same thing said in two different ways, but there’s a distinction. Honest…

Travel marketing needs to adapt to Generation Z

Even in the travel industry, taking customers and their willingness to travel for granted is a big mistake. As we’ve discussed, with the next generation of travellers it may take more persuasion than normal. That persuasion needs to be carefully planned and well thought through. Most importantly of all, it needs to be tailored to suit the behaviour and expectations of young buyers. We’re talking short-form video content through mediums such as Snapchat and Youtube; content that’s simple, shareable, visual and inspiring. Easier said than done, but the first generation of truly digital natives have got plenty of distractions to flick between. Travel operators need to cut through the noise.

The next generation of travellers spends more time watching video than any other generation in history.

The next generation of travellers spends more time watching video than any other generation in history.

They’re a social bunch too, so community driven content that encourages a relationship between your brand and each individual is the way forward.

And then we get to the mediums through which this marketing should happen. This is where we fight fire with fire. As much as we’ve been saying that digital technology poses a risk to the travel aspirations of members of Generation Z, the irony is that technology can also provide the solution. For example:

Harness the power of instant messaging

You might want to tap into fast-growing messaging platforms to offer a more personalised service. This is a generation used to having instant access to solutions and information. Anything less than that kind of speed is likely to put them off from dealing with you on a repeat basis.  

Enter their world

The real world should never pale in comparison to the virtual world. Travel offers so many opportunities and experiences that can change all of our lives for the better. If it takes a little technology to prove that and get Generation Z-ers interested, then that’s no problem. Why not create virtual reality travel content around your products to make them more enticing and immersive to a younger audience?

Being internet-savvy entails that this is a customer group that can spot cheesy campaigns from a mile off. Instead, members of Generation Z are far more likely to listen to the advice of their peers and people whose opinions they respect. Subtly tapping into the power of market influencers, whether it’s Youtube stars or Instagram giants, is definitely worth considering.

Adapt your products

Away from the techniques of marketing, one simple way to appeal to the next tech-savvy generation is to make your products as tech-friendly as possible. Generation Z is used to viewing the internet as any other utility – just like running a tap for water or turning the heating on. If you can incorporate this level of connectivity into your trips, along with other digital touches, from contactless payments to electronic keys, biometrics and (hell, why not) robot butlers, you’ll appeal both to their imagination and their love of efficiency.

Is the travel industry ready for generation z. It will probably need to adapt.

Our versatile travel marketplace platform

We’re incredibly proud of the travel marketplace platform we’ve built from scratch. One of its key features is that it allows you to build a marketplace that’s community driven and packed with relevant content from sources your customers will trust and engage with – Certainly one way to appeal to the Generation Z travellers on the horizon. Get in touch with us today to find out more and get started on your own travel platform.

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