Harnessing Modern Tech to Tackle Travel Industry Challenges
Eva Krydowska
Managing Partner UK (WSE:THG) | award-winning Microsoft partner | digital transformation | emerging technology solutions
Travel industry: changes and challenges
The travel industry has undergone significant transformations in recent years, primarily due to the COVID-19 pandemic. As the sector rebounds to pre-pandemic levels in 2023, new challenges arise, demanding innovative technological solutions. In 2024, sustainability has become a crucial concern for travellers, driven by growing awareness of environmental impacts. Technologies like blockchain enhance transparency in supply chains, allowing consumers to verify the sustainability of their travel choices. AI-driven tools help travellers calculate and offset their carbon footprints, offering greener alternatives and making eco-conscious travel decisions easier. The competitive travel market also requires brands to differentiate themselves effectively. Virtual reality (VR) offers virtual previews of destinations, captivating potential travellers and showcasing unique experiences. AI can analyze consumer data to deliver personalized travel recommendations and promotions, making marketing efforts more targeted and effective.
Online reputation management is critical in today's digital era. Reputation management software and AI-driven customer service solutions address issues promptly, maintaining a positive image and ensuring consumer trust and loyalty. These tools help manage online reviews and feedback, which are vital for sustaining a good reputation.
Geopolitical issues add another layer of complexity. Real-time risk assessment tools provide timely updates on geopolitical risks, helping travel companies make informed decisions and communicate effectively with travellers. Automated refund systems streamline responses to geopolitical incidents, enhancing customer trust and operational efficiency.
Customer retention has become more challenging due to rising living costs and heightened environmental awareness. Blockchain ensures the security and transparency of loyalty programs, making them more appealing to consumers. Mobile apps offering personalized recommendations and real-time updates enhance the overall travel experience, helping brands retain and attract loyal customers.
In this article, we discuss how modern technologies like blockchain, AI, VR, and advanced data analytics can offer effective solutions to the travel industry's pressing challenges. By embracing these innovations, travel brands can meet evolving consumer demands and pave the way for a more sustainable and efficient industry.
Addressing the Challenges in the Travel Industry through Modern Technology
The travel industry has bounced back from the pandemic-induced slump, with 2023 marking a return to pre-pandemic levels of international holiday travel. However, the landscape has shifted dramatically, with new challenges arising in 2024 that necessitate innovative solutions.
Here's how modern technology can help address these key challenges:
Environmental Impact
Sustainability has become a crucial consideration for travellers, driven by heightened awareness of global issues. In 2024, eco-consciousness is no longer a mere trend but an expectation. Brands must lead with transparency, showcasing their sustainability efforts clearly and honestly to build trust and connect with environmentally mindful consumers.
Technological Solutions:
Brand Differentiation
With the travel industry becoming increasingly crowded, standing out is more challenging than ever. Brands need to establish clear USPs and communicate them effectively to attract and retain customers.
Technological Solutions:
Social Media Engagement: Leveraging social media platforms for storytelling and showcasing unique experiences can help in building a strong brand presence.
Maintaining Online Reputation
A robust online reputation is critical, as negative sentiment can significantly impact a brand. Proactive online reputation management is essential, not just during crises but as an ongoing strategy.
Technological Solutions:
Geopolitical Issues
Geopolitical volatility poses significant risks to the travel sector, impacting tourism and economic growth. Effective communication and contingency planning are crucial in navigating these uncertainties.
Technological Solutions:
Customer Retention
With the cost of living and climate concerns at the forefront, retaining customers has become more challenging. Brands need to balance cost and conscience while offering personalized services to foster loyalty.
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Technological Solutions:
Conclusion
The travel industry in 2024 faces multifaceted challenges that require innovative technological solutions. By leveraging blockchain, AI, VR, and other advanced technologies, travel brands can address sustainability concerns, differentiate themselves, manage their online reputation, navigate geopolitical issues, and retain customers effectively. Embracing these technologies not only helps in overcoming current challenges but also paves the way for a more resilient and future-ready travel industry. Something we at TenderHut group feel passionately about.
Environmental impact
After experiencing near-decimation as a result of the travel restrictions imposed during the pandemic, the international holiday market returned to pre-pandemic levels in 2023.
But while travel volume may have returned to ‘normal’, the effects of the pandemic are lasting, with many consumers having a transformed awareness of global issues affecting the planet and society. As such, sustainability – while by no means a new concept in the travel industry – is front of mind for many consumers in 2024.
Keen to return to exploring new destinations, consumers – whether budget travellers or those looking for more luxurious breaks – are increasingly thinking more mindfully about the way they travel, taking the environmental impact of how and where they travel into consideration when booking a trip.
While it could easily be perceived as another travel buzzword, brands need to realise that sustainability is more than a passing trend. Fast becoming an expectation – rather than a nice-to-have – brands who ignore the sustainability agenda entirely will automatically be on the back foot amongst their competitors, and those who don’t take it seriously enough, by implementing proper, strategic sustainable goals and policies, risk being accused of greenwashing, thereby also losing out.
Rather, by leading with transparency and prioritising communicating sustainability objectives, initiatives and credentials, as well as sustainable experiences, clearly, brands can build genuine connections with their audience and deepen trust, helping to achieve cut-through with consumers on the hunt for planet-friendly holiday choices.
Brand differentiation
If all indications are correct, 2024 will continue last year’s trajectory and outpace 2019 in travel volume. But with so many consumers looking to book a getaway, the travel industry has become an incredibly crowded space, meaning brands really need to consider what sets them apart from their competitors.
Travel trend predictions anticipate experiential travel, ‘set-jetting’, ‘cool-cationing’ and regenerative tourism – amongst other things – to be the next big things in 2024. And while it is certainly important to pay attention to these trends, it is equally critical to consider whether they are something your brand can get involved with authentically.
If you haven’t already done so, now is the time to really nail down your USPs. Instead of trying to achieve mass appeal, consider what makes your brand stand out. To establish your niche, decide what your key selling points are and focus your travel PR strategy on that. Remember, it’s better to do one thing well than try to do it all.
To pique the interest of consumers and make a lasting impact, consider implementing a creative comms strategy that uses storytelling to highlight your USPs, whether that be highlighting the unusual destinations you offer, sharing behind-the-scenes content about exclusive experiences that align with the latest trends, or sharing tips and tricks to help consumers get the best deals for their next break.
Maintaining online reputation
Individuals and businesses ignore negative online sentiment at their peril.
When a customer searches for your business, the first page of Google should reflect how you wish to be perceived as a brand. Which is why online reputation management should not be focussed on only in times of crisis. Nowadays, reputation is currency and a company’s digital footprint plays a massive role in this.
People want to travel with those they trust and when you’re competing against travel companies and providers, the difference can come down to one negative review or which page of Google you appear on.
Those are all things a travel PR and digital strategy can handle. A curated media strategy built on testimonials and reviews can help to boost rankings in search engines. And for when disruptions, cancellations or accidents do occur, a crisis communications plan can help in maintaining online reputation whilst ensuring customer trust isn’t affected – meaning your brand doesn’t take a nosedive.
Geopolitical issues
Last year, a report from Euromonitor identified geopolitical volatility as one of the biggest risks to travel sector growth over the?next two years.
Geopolitical issues can trigger social unrest and concern, which in turn can have a significant negative effect on tourism – meaning jobs, local communities and wider economic growth are all at risk. Therefore, getting a handle on what this means for your company is key and secondly, the communication around this.
The pandemic, although not a geopolitical issue, serves as a prime example of what the travel industry should not do when faced with an unprecedented risk in the future. This includes delays in refunds, uncertainty around flights and departures and a lack of communication with travellers on restrictions, testing requirements and more.
If a geopolitical incident does occur, an effective communication strategy will ensure that refund and cancellation policies are clear and that customers feel assured about their travel plans. It’s also important to maintain strong relationships with tourism boards in those impacted countries, for when the time is right, to re-commence travel.
Customer retention
There are two big crises at the front of people’s minds right now – the cost of living and the climate – both of which are playing a part in making it more difficult than ever for brands to retain customers.
While in the past customers may have been loyal to brands that they had travelled with previously – whether that be airlines, hotels or excursion providers – customers are increasingly savvy, instead opting to shop around for the deals that tick most of their boxes and align with their personal values.
As such, acknowledging the shift in consumer priorities and finding the balance between cost and conscience? is key for brands, if they are to retain customers who are looking to book holidays and travel experiences in 2024 and thrive in the long-term.
Equally, in today’s highly competitive travel industry, customer service and personalisation are key to retaining customers. Offerings including tailored recommendations, personalised offers and loyalty schemes are increasingly expected by holiday-makers, and proven to encourage repeat bookings.
By implementing these customer retention strategies and communicating them creatively to consumers as part of a clear PR and social media campaign plan, travel brands can increase customer satisfaction and foster a sense of loyalty and connection to the brand, encouraging customers to stick with them for a while longer.
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