Sunday, July 14, 2024

How Generative AI Is Revolutionizing the Travel Industry

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Opinions expressed by Entrepreneur contributors are their own.

If you’re in the travel industry, you already know that nearly everything you do is driven by the constant need to innovate. In the past, that need has been driven by a variety of market forces and inventions, from more extensive road networks and advances in ships and jets to online booking and dramatic changes forced by the Covid-19 pandemic.

Generative AI is the latest major innovative force, and it can’t be ignored. It’s changing the way large and small companies do their travel business, and GenAI has supercharged an already hypercompetitive industry to a new level of overdrive. Change in the travel industry is constant, and AI is accelerating it beyond what anyone can imagine, even industry experts.

Learning new things and transforming business operations always means a series of challenges and issues, but GenAI also represents an amazing opportunity that goes well beyond the simplistic “innovate or die” aphorism. This technology simply can’t be ignored, and that’s especially true for smaller businesses — they need to embrace GenAI early and make sure they do it the right way.

Related: The Power of AI in Travel: A Look at How Artificial Intelligence is Shaping the Future of Tourism

Disruption in the travel industry: Your trip will soon be driven by generative AI

While some industries were blindsided by the incursion of AI into traditional best practices, that’s not the case with the travel industry at all. Travel leaders have already had to integrate personalized marketing, predictive pricing, deep analytics and ecommerce into the way they do their work. But generative AI is adding powerful new capabilities in all of these areas, not to mention new ones that are exponentially more impactful.

Take online itinerary planning. It’s been available for some time now, but existing versions seem almost primitive compared to what GenAI is capable of creating. Established companies like Kayak and Expedia have been experimenting with online itinerary planning for some time, and new products and features are being added on a near-daily basis.

Let’s use the example of planning a trip to a new destination. Plug in some well-chosen parameters and a few precise prompts about the travel experience you want, and GenAI will present you with dozens of exciting possibilities, whether they’re cultural, culinary, historical or entertainment-based. This level of personalization is driving higher satisfaction and conversion rates among users, and it’s a perfect example of a new opportunity being driven by AI.

GenAI represents the ultimate opportunity for travel professionals

This example barely scratches the surface of what GenAI can do, though, and the segment of the travel industry that’s best positioned to take advantage of it are Tour Operators and Destination Management Companies. These businesses already account for up to 40% of global travel expenditures, which means they pack a lot of market clout. And GenAI is more than capable of multiplying that market power.

Why? Let’s take Destination Management Companies, for example. They already have experience, contacts and knowledge about local travel details that can make or break a trip or turn a good trip into a memorable, once-in-a-lifetime experience. Add in the power of GenAI, and they become industry leaders when it comes to tailoring individual trips for their clients — plus, this technology makes it easy for them to broaden their reach. This kind of unique nimbleness simply can’t be matched by larger travel companies or new travel technology startups, and it also allows them to pivot much more quickly to new market demands.

Moreover, employees in travel companies tend to be innovators by nature. Their first instinct is usually to create something that adds value to customers in amazingly powerful ways. They also understand once travel preferences change, customers simply don’t want to go back to the old way of doing things.

Related: How AI Solutions Can Improve the Travel and Hotel Booking Experience

What I learned running AI workshops with travel industry leaders

My knowledge about these issues is based on my experience running AI multi-day workshops with travel leaders and members of the National Tour Association from around the world, and the time I’ve spent with them has been a revelation.

Their reactions to GenAI tend to be very different than leaders in other industries. They’re not reacting fearfully or warily at all — instead, they’re embracing the capabilities of GenAI with open arms, largely because they quickly see the potential and are able to capitalize on this new technology. They are true-born innovators.

As laudable as that openness is, though, it also comes with some important caveats. Learning about generative AI isn’t easy. It takes more than just an open mind; there’s hard work involved, along with the struggles that come with learning and deploying any new technology, especially one as powerful as AI. It has to be done systematically and comprehensively, so I’ll offer some guidelines to use as a potential path.

My AI advice for travel industry leaders and professionals

Develop AI literacy:

The process of using and capitalizing on GenAI starts with developing what I call “AI literacy.” This kind of literacy is as fundamental and important as the reading and writing skills we all learned when we were very young. There’s a lot of information out there about GenAI, and it’s important to be aware of how this technology works and what it can do. That’s the first step in adapting it to your specific needs as a travel industry leader.

Take a pragmatic approach:

Start with a clear goal that translates into a metric. This will give you the time and guidance to focus on what you do best — serving travelers. The next thing you need to know is where in the travel process to use GenAI. My suggestion is to first use it to streamline your operations — from initial drafts of itinerary creations to data and opportunity analysis. The possibilities are endless.

Related: ChatGPT for Traveling: Can AI Plan Your Next Vacation?

AI will not replace travel agents — it will make them more impactful

Finally, you need to understand that AI won’t replace travel planners; it will amplify their magic. By handling routine tasks, AI frees up travel planners to focus on the heart and soul of their work, which is to create unforgettable experiences and build meaningful relationships with clients.

Imagine a world where travel planners have more time to listen, understand and cater to the dreams of each traveler, then make every journey special and unique. AI provides the tools and insights, but it’s the human touch, the passion and the creativity of travel planners that turn trips into cherished memories. Far from taking jobs, AI will open new doors for travel planners, allowing them to shine brighter and make a deeper impact on the lives of those they serve.

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