Technological advancements will bring the tourism landscape back to its peak season. The travel and hospitality sectors must capitalise on the best technology to regain travellers' confidence over the next 12 months amid the coronavirus pandemic, according to the Amadeus Rethink Travel Global Survey conducted in September.
The tourism sector has been devastated by the pandemic and lost $720 billion in revenue between January and August this year, according to the United Nations. The UN Conference on Trade and Development (UNCTAD) also found that the global tourism sector could lose at least $1.2 trillion, or 1.5 percent of the global gross domestic product, due to the pandemic. But despite the setback, the travel and tourism sectors have increasingly incorporated the latest technological development in their business models to accelerate their pace. The latest research by Tourism New Zealand recommends that the country embrace technology to lift tourism productivity even further.
Tourism New Zealand chief executive Stephen England-Hall said embracing technology and digital capability could lift tourism productivity in bringing high-value international visitors to sustain the sector. This long-term goal is now made possible by rapid growth in digitization, ranging from contactless check-ins and check-outs, digital invoicing, online payment options, QR codes, digital menus in restaurants, to the virtual trip experience.
Boosting Business with a VR tour
The shrinking demand did not seem to stop countries from making extra efforts to develop interactive ways and unique selling points, such as the use of virtual reality (VR). The pandemic has been a "shot of adrenaline" for a technology that to date had "not yet really arrived," allowing remote travel that is potentially attractive to a greater audience, said Steve Perillo of Travel World VR. Before the start of the pandemic, Irish tourism officials explored VR to showcase the best the country has to offer. This trend has since been followed by other countries, including Germany and the Maldives, to step up VR marketing efforts to ensure the gradual recovery of their tourism industries.
The German National Tourist Board (DZT) has introduced viewers to 360-degree videos designed for Oculus Rift headsets and Microsoft HoloLens, allowing them to experience the country's famous parts and sites such as the Baltic and the North Sea coasts.
Ralph Hollister of Global Data said the pandemic has boosted VR imaging from being a gimmick in tourism to becoming a valid form of alternative travel as consumers get more used to this technology. Limitations, such as the large, cumbersome headsets and high costs, might still hold back global brands from investing in the technology. But this could change soon with the launch of Amazon Explore that enables a one-on-one virtual experience with tour guides and locals around the world.
The beta version has already offered experiences ranging from site tours in Japan to artisan shopping in Costa Rica. Miguel Flecha, a travel and hospitality expert at Accenture, might consider Amazon Explore to still be in the infancy of the VR travel industry, but serious investments by tech giants and global brands such as Amazon would be a "great accelerator" for VR technology.
Innovative payments to improve the customer experience
Besides upgrading marketing plans, the tourism sector must also catch up with disruptive financial technology that has become increasingly complex to manage and can quickly drain a company's revenue. As lockdowns continue to weigh on earnings, the tourism sector, especially travel operators, must keep their operating costs down and streamline their operations to conserve cash and maintain financial health.
Today's travel programs must be equipped to ingest and reconcile all these emerging payment types. Streamlined processes will continue to emerge as the adoption of contactless payments continues to increase and corporate travel slowly returns, Valerie Layman, vice president for product management at Coupa Software, told Business Travel News. The Amadeus report also recommends reducing physical contact throughout the journey by using contactless and mobile payment options, such as Google Pay, PayPal and Venmo, as 42 percent of travellers prefer to improve their payment experience.
Some companies have also prepared innovative payment services using payment orchestration platforms. Cebu Pacific, a low-cost carrier in the Philippines, will apply payment orchestration through its digital channels to leverage its customers' purchase experience.
Diversify offerings for repeat customers
The International Air Transport Association (IATA) on October 13 said international traffic airlines only operated at about 10 percent of their normal levels during the pandemic. International travel has also taken a significant hit, with total airline revenues estimated to have plunged by 55 percent to $314 billion from last year. The immediate impact of the pandemic has been devastating and forced some airlines to diversify their offerings.
All Nippon Airways Co (ANA), for instance, will launch a cashless payment service via smartphone called "ANA Pay" in December this year. The mobile payment platform will use JCB's unique QR code standard to allow frequent flyers to accumulate miles through their daily shopping and receive between 6 and 16 miles per 1,000 yen ($10).
Given its role in the travel and tourism sector, technology can address many coronavirus-related problems. It was developed over time so the tourism sector can quickly adapt to the changing environment and improve sustainability. Although the Amadeus survey shows there is a growing appetite for the tourism industry to embrace, it is clear that technology will play a significant role to revive tourism as it requires a community response to get the world travelling again.
Arjan Dijk, senior vice president and chief marketing officer of Booking.com, expressed a similar idea, stating that "in this new decade, we'll see how the travel industry tries to respond to the needs of a type of a traveller more concerned with sustainability, and with more tech knowledge or curiosity, through developing products, functions, and services make discovering the world easier for all."