Exploring the Impact of AI on the Future of Tourism

Delivering the best customer experience is one of the top priorities across the tourism industry. With the help of artificial intelligence, many businesses such as hotels and travel agencies are improving their services ranging from online booking to personal assistants. 

The Travel & Hospitality AI Market is estimated to reach $1.2 billion by 2026, at an estimated CAGR of 9.7% from 2021 to 2026.   

Understand how AI empower tourism industry, and its advantages travel companies should be aware of to stay competitive in the tourism industry.

What is AI?

A field of computer science where machines and computer programs simulate human intelligence capabilities, such as decision-making and problem-solving.

The technology involves deep learning, machine learning, computer vision, etc. There are many examples we see daily, such as chatbots, self-driving cars, virtual assistants, and much more.

Also, artificial intelligence is evolving with technology like generative & edge AI, etc.

Why is artificial intelligence important in the tourism industry?

There are multiple use cases of artificial intelligence in the tourism industry. From a consumer perspective, this technology helped them to find better and more relevant information enabling them to get better tourism experiences.

From the business perspective, automation technology helps them in different areas, such as management and automating basic and repetitive tasks such as confirming bookings, offering economical ticket prices, handling customers’ basic queries, and much more.

With the help of artificial intelligence, tourism businesses can improve their digital services in various ways. Check out some exciting insights about digitalization for the tourism industry. 

• According to Trip Advisor research, 42% of clients plan their trips using smartphones. 
• 36% of clients prefer interactive booking processes, while 80% prefer self-service technology over traditional offerings (get.nice.com)
• After arriving at a location, 85% of consumers decide on their trip activities (thinkwithgoogle.com)
• 90% of clients want appropriate trip information when traveling to their destination (thinkwithgoogle.com)

Now, understand the ways how AI empower tourism industry.

How AI empower tourism industry?

Artificial intelligence has been implemented in many areas of the tourism industry, such as facial recognition systems and airport scanning devices.

Explore how artificial intelligence is widely used in the travel industry with real examples.

1. Virtual assistants for travel booking

Flights may now be booked online, eliminating travelers needing to contact travel companies. Virtual assistants and chatbots have replaced travel agents allowing travelers to book flights and accommodations. 

These chatbots are deployed to social media sites like Facebook messenger, Whatsapp, and Skype to offer users a more personalized booking experience.

Many travel reservation giants like Skyscanner, Expedia & Booking.com utilize such chatbots in their business operations. These chatbots search through booking sites to find the best deal for their users. 

Example: Skyscanner Chatbot

Users can use this tool on Facebook and WhatsApp. The Skyscanner chatbot allows users to communicate, and users can do this by entering their preferred destination. 

Customers who are unclear about their destination may just enter “anywhere,” and the bot will give them alternatives, including pricing, based on real-time search patterns.

When users provide travel dates, the Skyscanner chat boat will show them the cheapest flights to their destinations. The Skyscanner Chatbot will redirect users to the official flight booking website to complete the booking for the selected date.

2. Robots for face-to-face customer services 

Robots are continuously revolution in the travel industry, avoiding the need for human agents. Gone are the days when users have to wait in a queue to get information or find a gate in a busy terminal. Many airports and hotels have employed robots to assist customers in different situations. 

According to a report conducted by Vero Solutions, robots are expected to replace humans in the check-in process by 2030. 

Example: Connie

Connie uses natural language processing to understand the language of their customers. It uses IBM Watson and Wayblazer to answer human-related queries and offer recommendations. 

Moreover, Connie can move their arms and legs to show direction to guests and express different human emotions. This smart machine learns continuously from human interactions to further improve its capabilities. 

3. Applications for flight forecasting

What if there is an innovative technology that enables users to find the best flight price at the right time? Many companies have made such useful features by introducing price prediction driven by artificial intelligence in their applications. 

Example: Hopper

A smart machine learning algorithm that uses a flight database to predict optimal hotel and flight prices and offers personalized recommendations to the users about the most suitable time to book a flight.

Whenever users track their flight price, this smart machine algorithm suggests they buy it now or wait for a better price. Its extensive database consists of trillions of historic flight prices and now has sold flight tickets worth more than $600 million.

Many hotels and airlines use Hopper to modify their rates based on consumer demand. 

4. Data analytics to identify valuable insights 

The travel industry generates a huge amount of data every second through its users. Travel agencies can use such data to understand customers and offer them improved and personalized experiences. 

With the help of artificial intelligence, this massive data can be categorized into an organized structure more easily, which can be quite challenging when done manually.

Example: Dorchester Collection Hotel

The hotel uses its artificial intelligence platform Metis to analyze its customer with surveys, feedback, and online polls to improve their hospitality and services. Based on the data, Dorchester finds solutions to offer their customers a better experience. 

5. Sentiment analysis through social media

Airlines and hotels are leveraging the power of artificial intelligence to identify the sentiment of travelers throughout different social media platforms. Travel agencies can use artificial intelligence to know their customer experience with the help of their social media post. 

For example, suppose a customer expresses frustration by posting about a flight delay on social media. In that case, an artificial intelligence tool will analyze such posts and inform their travel partners.

Example: Mindtree’s PaxPulse

A social Intelligence and recommendation platform designed for the airline industry. Mindtree offers its pre-built classifiers, algorithms, and machine learning frameworks.  

The platform automates the complaints of their passenger by working on actionable recommendations and processing them based on pre-set business rules.

6. Tailored offers for MVCs (most valuable customers)

Travel businesses can use artificial intelligence to develop a solid model for offering special deals to their loyal clients. Customers can find the list of their loyal customers’ list using legacy data and the history of their purchases.

Example: World of Hyatt

The loyalty program comprises more than 1,100 properties worldwide, with hotels concentrated in major U.S. destinations like Atlanta, Chicago, New York City, and San Francisco. Their loyalty program rewards their loyal customers with room upgrades, airline miles, free nights, car rentals, dining and spa, and fitness services. 

Users can earn points by purchasing products from Hyatt’s partners and purchasing with a World of Hyatt credit card.

7. Dynamic pricing in the hospitality industry

A common practice in the tourism industry that adjusts prices based on demand, season, time for entry, and many other factors. Artificial intelligence can analyze users’ data to manage and offer the best prices. 

Dynamic pricing can increase the likelihood of booking and other activities that can maximize profits in the tourism industry.

Example: Starwood Hotels

Starwood (acquired by Marriott International in 2016) developed predictive analytical tools in 2015 that scan hundreds of factors to display the most efficient price. 

The factors include competitive pricing data, user booking patterns, weather, room types, daily rates, occupancy data, and other variables. 

The system works in a fully automated way where their staff can access the dashboard and manually adjust rates if needed.

8. Smart recommendations

Travel businesses can maximize profits by offering smart recommendations to their customers. The travel industry can smartly use algorithms to know its customers and offer them more personalized services and recommendations. 

Example: Trivago

Trivago, one of the best examples, uses machine learning technology and follows a customer-centric approach to offer the best hotel pricing. 

Their algorithm compares the internal data trends from their users and recommends hotels based on price, tourist destinations, cities, etc.

9. Language Translation 

Language is one of the biggest barriers for tourists when it comes to traveling and exploring the world across different local cultures.

Artificial intelligence has simplified the translation process, where users can translate foreign languages into their native ones with the help of translation applications.

Example: Google Translate

Google Translate is a free online machine-learning tool that helps users translate text documents and websites from one language to another. 

Users can access this tool via smartphone, which supports translations between 109 languages. The tool allows language translation with voice-based commands and texting.

Stay ahead in the tourism industry by implementing the latest trends in your business.

What AI trends will keep your tourism business competitive?

The latest trends are as follows:

I. Smart baggage handling 

Airports can be fully automated with robotics and artificial intelligence in the future. Since there is involvement in handling millions of bags each year at airports, they can utilize the power of artificial intelligence to handle them efficiently.

II. Robots and voice assistants 

In the post-pandemic era, many airline companies are looking for a way to automate check-in and checkout processes to assist their passengers with general inquiries. 

Voice assistance has become helpful in the airline industry in various ways, such as in guest rooms, ships, and airport security. We can expect a rise in many applications of artificial intelligence and robotics in tourism.

III. Personalized travel planning

Mobile apps have completely changed how people decide on travel plans. 

Application equipped with artificial intelligence includes new capabilities like recommending safe travel zone and tracking passenger health by integrating apps with wearable devices. 

IV. Cashless payments 

Offer your users a hassle-free experience with cashless payments. 

With the help of artificial intelligence, the travel industry can manage massive digital payments and transactions to protect its customers from fraud with the help of an intelligent fraud detection system.

V. Travel maps

Apps powered by artificial intelligence are helping travelers to reach tourist destinations they have planned for specific places. 

The tourism industry can integrate artificial intelligence with travel maps to offer more personalized travel guides to their customers.

Artificial intelligence can analyze the location of its users and can offer them nearby tourist places, restaurants, resorts, and many other places to enhance their traveling experience. 

The use of artificial intelligence even eliminates the need for local tour guides as the map already includes top tourist places that are worth exploring. 

VI. Disruption management optimization

With the high risk of travel disruptions such as canceled flights and delays., automated disruption is mainly applied to the travel industry. 

Artificial intelligence is helping travel businesses predict disruptions in advance and helping minimize loss for travelers and companies.

VII. Traveler profiling

An integrated data collection system is essential to understand the customers’ needs and preferences and deliver personalized traveling experiences. 

However, managing and analyzing customer data manually will need time and will have a high possibility of human errors. Artificial intelligence can do such tasks much quicker with zero mistakes.

By leveraging the power of traveler profiling tourism, businesses can shape new strategies and draw conclusions based on traveler requirements. 

VIII. Content recommendation

The digital footprints of each customer on different traveling platforms allow businesses to understand their needs, budgets, and preferences. 

Traveling businesses can highlight their benefits to customers with the help of content such as videos and blogs. 

Delivering the right content recommendation will help tourism businesses to target the right audience base and promote their products and services. 

By analyzing a large amount of data, companies can investigate their customer’s behaviors to offer them personalized content, such as blogs and videos, to engage them better on their platform and turn them into leads. 

Conclusion

We should consider the impact of artificial intelligence on the tourism industry. Airline companies and other tourism industries are exploring the benefits of artificial intelligence in the travel industry, including airports, railway stations, hotels, and other businesses. 

The extensive power of innovative technologies has simplified traveling experiences such as trip planning, booking, exploring the best hotels, and much more. 

For businesses involved in the traveling industry, artificial intelligence can help them to improve their services by reducing expenditures, boosting operational capacity, uplifting customer services, and with many other benefits. 

It is worth creating AI applications and products for your tourism business. 

You may need to hire AI developers to help you build your products and services powered by artificial intelligence. 

And the best way to hire artificial intelligence developers is to outsource your development work to an AI development agency. 

These agencies are experienced in creating digital products based on artificial intelligence and machine learning. You can check their portfolio for apps and other digital products based on artificial intelligence, especially for the tourism industry.

Empower your tourism business with AI

Work with us and get proven solutions for your travel business with artificial intelligence. 

Our team has experienced artificial intelligence developers who will work closely on your project and elevate your tourism business by implementing the power of artificial intelligence. 

We use the latest technology and best practices to ensure your digital platform is secure, scalable, and user-friendly. 

By leveraging our expertise in custom AI development, you can improve and increase the revenue of your travel & tourism business by implementing and creating advanced features and services.

Call us today to learn more about how we can help you unlock the full potential of your tourism business with AI development.

Contact Idea Usher 

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FAQ

Q. How can AI be helpful to the tourism industry?

A. Artificial intelligence technology is helping the tourism industry in various ways, such as: 

• Personalization
• Dynamic pricing
• Sentiment analysis
• Hospitality
• Customer support

Q. How will AI shape the future of tourism?

A. Technology is reshaping the future of the tourism industry in many ways:

• Use of IoT technology to track customers’ health, such as heart rate during flights and staying in hotels
• AI assistant for offering personalized services to users, such as booking flight tickets and finding nearby restaurants and resorts.
• Flight forecasting to predict and manage the upcoming demands of flights. 

Q. What are the top AI apps in the tourism industry?

The top apps are as follows:

• Hopper
• Kayak
• Booking.com
• Skyscanner
• Expedia