The Future of the Travel Industry
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There’s no question that the internet has transformed the travel industry in the past decade. A flurry of new competitors, OTAs and direct-supplier websites have forced many players to reinvent themselves to stay in business.
For some, this shift has meant focusing on a wealthier clientele looking for a travel concierge to handle the logistical challenges associated with longer, more exotic trips. And, while this level of service may appeal to some, research by IBIS World shows that — unlike their Baby Boomer counterparts — Millennials are happier booking their own travel. This doesn’t mean it’s the end of the road for travel agencies, just that they’ll need to continue to evolve moving forward.
Here are four trends likely to reshape the travel agency industry in the coming years:
- Artificial intelligence and user data will greatly improve travel recommendations
Overseas Adventure Travel (OATs) will continue to offer variety, but not personalized solutions
- Today’s travelers want authentic experiences, not souvenirs
Tomorrow’s tech-reliant consumers will demand a great digital experience
MANY TRAVELLERS WILL NOT ALLOW OTHERS TO PLAN THEIR TRIP FOR FEAR THEY WOULD NOT UNDERSTAND THEIR TRAVEL PREFERENCES
The study also found that while 85% of travelers are open to having a third-party plan their trip, what people look for in a travel agency differs depending on how frequently they travel. Frequent travelers seek agents that will save them time, whereas infrequent travelers want an agent to save them money and stress.
FREQUENT TRAVELLERS VALUE A TRAVEL AGENT FOR SAVING TIME WHILE INFREQUENT TRAVELLERS VALUE SAVING MONEY
Though budget-conscious, Millennials are not penny pinchers. “You’d be making a huge mistake if you translate them as ‘cheap’,” David Chapman of the World Youth Student and Educational Travel Convention (WYSE), an expert on Millennial travelers. “They will spend where they need to in order to curate that once-in-a-lifetime travel experience.”
Given these trends, what will travel agencies of tomorrow look like? Perhaps something like Lola, a “new kind of travel agency” that integrates a chat interface with AI and human expertise to generate personalized trips.
One thing is clear – the onus is on travel agencies to clearly communicate the kinds of personalization they offer and to prove how their services generate a return on investment. And, not surprisingly, they’ll need to provide exceptional service online that offers an experience today’s tech-savvy consumers have grown up with and have come to expect across the board.
- Tomorrow, travel agencies that thrive will be digital first, offering personalized recommendations and incentives, while allowing their users a certain amount of freedom and flexibility to plan their own trips.
Artificial Intelligence and the use of user insights will continue to disrupt the travel industry.
Check out a few of our other posts for the latest internet and industry trends