Following on from our recent exclusive Digital Travel Dinner, we hosted a roundtable discussion in the UK featuring a hand-picked selection of travel and tech industry disruptors and experts. 

We invited a cross-section of voices, from industry players working for established tour operators, to cruises, large airlines and more, plus disruptive start-up founders. What follows are the key takeaways from a really interesting few hours of insider insight, intelligent debate and industry inspiration.

How the long tail of COVID is still with us

While for most consumers the global pandemic is already fading in memory, we discussed how there are still plenty of scars left on the travel industry that mean the industry is still recovering. 

Given the existential challenge posed by countries locking down their borders, perhaps this shouldn’t be a surprise, but travel disruption and labor shortages continue to be real-world after-shocks that customers experience.

In COVID’s wake travel companies have been left to wrestle with the same inflationary pressures that have affected consumers’ spending power. We wanted to know how this had affected pricing parity and competition.

Interestingly, it became clear from our conversation that consumers are – for now at least – being largely shielded from price rises, with travel companies finding ways to absorb the cost increases and keep prices competitive. As margins shrink (and travel has never been a high-margin industry), those players who can still find the value in smaller margins will obviously prosper. 

What impact is disruptive innovation like AI having on the travel industry?

Tech-driven change, it was agreed by everyone, is coming to the travel industry. Fast. What was striking in our roundtable though were the varying degrees of maturity of different tech-powered offers. 

Tour operators are embracing a digital-first model that means consumers can book their own holidays via their laptop or phone rather than the high street. The areas being prototyped now are AI-powered personalized concierge experiences that know and understand each customer, based on data that reveals their demographic, interests and holiday preferences. 

These would create a hyper-personalized customer experience that would be familiar to anyone who has booked regularly through a travel agent that knows them personally or specializes in bespoke holiday packages. So when booking a destination, customers could be upsold from a menu bespoke to them based on factors like their tastes, cuisine preferences, socio-cultural background. 

The future isn’t human vs. algorithm

Using the huge leaps in processing power and AI tech mean that hyper-personalization like that discussed above could be done at scale. But it’s worth pointing out that AI is helping to build those data models rather than replacing the human face of their companies. 

Everyone agreed that the future for travel booking is the best human talent augmented by bleeding-edge tech. The skillset of a great travel agent – the warmth, empathy, insight – is what drives bookings and their conversion. In our discussion there was some nervousness around using digital to make the process too transactional: the technology is there to super-charge the work of the human agents, not replace them.

At the moment AI processing power is being used behind the scenes of some of the bigger travel apps and websites to interrogate customer data, check whether they’re a returning customer, and understand their preferences for holidays.

Smart use of science could also sit behind the post-booking phase of the customer journey too, before any trip begins, with targeted pre-travel offers of foreign currency, additional legroom seats, group seating, airport transfers, priority check-in and more. 

By using a combination of behavioral science nudges, huge processing power and AI to interrogate data, companies can optimize the timing of offers: incentivizing customers to upgrade their travel packages (and increase margins). 

This might mean personalized offers for just the kind of upgrades customers are most likely to be thinking about, just as they are most likely to be thinking about them (based on analysis of personal data), delivered straight to their inboxes.

AI is rocket-fuelling launch times for new products and services One of the main areas where AI is having an impact already is how it’s dramatically increasing speed-to-deployment times. We talked about how some businesses now use AI in software testing for a product or function launch, to drastically reduce testing times and analysis.Whereas in the past you might have had an army of people spending months to identify and fix issues, AI is transforming those schedules so that the same work is done in days and weeks.

We talked about how the more cautious build-before-buy approach is being replaced by an awareness that buying in capacity and expertise from the marketplace can help bootstrap lead times.

CX expectations can be generational because of life stages (and the stakes involved)

One interesting area of discussion came out in the way that different generations expect to be able to interact with technology, and what that means for their customer experience demands as travelers. 

In our discussion we heard from a Gen-Z founder whose start-up is working with a large global airline. Far from wanting personal interactions from his travel operator, he wanted to be left well alone. “The best service is no service”, at least if he is able to travel easily and quickly using the digital travel wallet in his phone, whether it’s tickets, itineraries, check-ins or recommendations.

Whereas younger people are more comfortable with tech-driven, contactless services, all the evidence is that older generations still enjoy (and perhaps rely on) more traditional, human-centered experiences. Not only is this reflected in the generational differences in technology usage, we talked about how it is also a reflection of how travel is a prism through which our life stages are filtered. 

So for example, a few carefree (childfree) twenty-something friends on a city break might be fairly relaxed about travel disruption. Whereas a young family on its way to a once-in-a-childhood trip to Lapland at Christmas will have a very different set of expectations about the level of customer support needed (should hitches be uncovered en route to Santa).

Is the technology mature enough yet?

Amongst our round table the general consensus seemed to be that, while there was excitement around the ways in which AI-fuelled disruption will be a game-changer, there was an accompanying nervousness as to whether the maturity of the technology could fully deliver yet.

Customer brand loyalty in the travel industry is hard won but easily lost. The last few years in the UK have seen several once-revered travel brands disappear, so perhaps it’s no wonder that there was an aversion to potentially risking brand loyalty. 

You don’t need to be an industry insider to know that travel is one of the most emotive purchases customers make. Even in the teeth of a cost of living crisis, most people are quite willing to invest in travel experiences because of the hugely beneficial impact that holidays and travel can have, whether it’s on mental wellbeing or physical health.

At present it was acknowledged that customer care, led by human interactions from great travel agents is far more effective and important in building and guaranteeing brand loyalty, but that there is a key role to be played by AI and tech in tandem with great human talent.

What tech-fuelled disruption is in store for contact centers?

Obviously, given our background at Concentrix + Webhelp, we’re really interested in the impact of new technology on the future of customer experience. We discussed what contact center support might look like in th future, including elements like concierge, customer triage, as well as the personalization of travel experiences. For advisors, whether they’re in a contact center or a high street travel agent, the service they provide could be improved and augmented by data-powered AI tools automatically presenting them with the travel intelligence and research (for which historically they would have had to know where to look).

That could include information on flights, transfers, hotel bookings and all the usual travel industry data that allows millions of people every day to criss-cross the globe. But it might also include less obvious data like, for example, government advice on getting married overseas (a popular travel option), governed by a set of visa restrictions unique to each country. 

If all this information can be made instantly available at the fingertips of agents then they can focus on meeting – and exceeding – customer expectations. 

The rise of dynamic packaging

Our discussion also covered challenger organizations like booking.com, which enable customers to book a combination of flights, excursions and extras.For established travel operators it means they’re now competing with low-cost carriers, whose lack of retail footprint means they can undercut the competition. They’re competing for the same inventory of hotel rooms and the same destinations in a global market. Investing in AI that can personalize recommendations and more for customers at scale could potentially help those larger companies compete smarter and harder against smaller disruptors.Customers are also learning the hard way that there are disadvantages to being ‘their own tour operator’, when travel disruption strikes and they don’t have the protection of trade associations and protections like those offered by ABTA, ATOL and IATA. 

ESG has a big role to play in a rapidly-warming world

We discussed how climate change is already playing a big role in changing holiday destinations, creating new global winners and losers, and the emphasis this will put on travel companies’ ESG policies.

Confronted with the reality of furnace-hot summers, tourists are beginning to turn away from Southern European countries like Spain and Italy in favor of cooler northern countries like Sweden, and this trend will only pick up momentum as global temperatures keep rising.

In turn this will undoubtedly have an impact on travel companies as governments are pressured into further regulation of carbon-intensive industries, with potential restrictions around the volume of flights, the number of routes and more. 

At Concentrix + Webhelp we are already seeing this happen with an airline we work with, which is now only allowed to fly certain routes into the Netherlands. How will all this affect customers’ decisions of where and when to book travel?

We hope you found our travel industry discussion as interesting as we did. If you’d like to talk more about any of the issues raised we’d love to dig a little deeper with you.