4 Ways AI Will Forever Change the Travel Industry

AI is not only here to stay, it is here to transform our personal and professional lives in ways we could previously only imagine. Whether we like it or not, this technology will be embedded into every aspect of our lives. As the concept of an AI-powered world shifts from sci-fi to reality, let's explore how AI impacts the travel industry from both a consumer and a provider standpoint.

And ironically, no, this article was not written by AI.

Where does AI stand now in travel-planning capabilities?

People overestimate what AI can currently do, but they also overestimate what it can't do. For consumers it can do some pretty cool things, like save tens of hours of trip planning with decent prompt engineering. However, it can also suggest the most arbitrary itineraries with very concerning recommendations — including the travel-specific chatbots. This is because it takes a good amount of time and money to train an AI system on a specific use case, with multiple variables and contexts, to achieve a high level of accuracy. Using no-code solutions and simply plugging in an LLM will generate very average and often false results. The by-product of these quick-fix AI solutions is that users disregard their value and return to their traditional ways of completing tasks.

For businesses, off-the-shelf AI can do some pretty cute things when it comes to automation, especially for SMBs. However, off-the-shelf AI can't do complex things with precision, like planning truly customized itineraries at scale, especially in logistics-heavy travel categories.

In the safari business, for example, operators need precision, not cuteness. At the moment, we don't believe AI will replace the travel advisor in this industry, due to both the trust element travellers require before venturing into Africa and the average age of the typical safari goer. They aren't digital natives, and wouldn't be as trusting of an AI agent planning their African safari. This is particularly prevalent in the luxury category: according to SKIFT's travel report, 85% of luxury travellers view travel advisors as the best way to book personalized luxury travel.

Having said that, trust in AI tools is growing by the month, and the inevitability of AI being integral to the travel planning process is no longer up for debate.

According to Amadeus, 41% of travel companies say their organization has the budget and resources in place to implement Generative AI, while 87% are open to working with a third-party vendor to develop Generative AI-powered applications.

1. The obvious (and non-obvious) automation gaps

In general, what took a travel consultant 10 hours will take them a few minutes, and what took 25 emails to achieve will now take 25 seconds. We know, because we've been travel consultants ourselves.

Hyper-personalization at scale, down to the absolute detail. This can already be done for repeat customers and even potential customers in your CRM, with much less data than ever previously required. In the future, we have no doubt that every website will be hyper-dynamic, which means the same URL will look different for me and for you. Amazon and Netflix already do this, since they have tons of historical data on each visitor.

Travel-based chatbots are cute, but the responses they spit out are sometimes laughable — suggesting a hotel in Durbanville for a Cape Town itinerary section, for instance. We believe we will soon see niche chatbot advisors providing itinerary planning and travel advice for specific categories and locations, that can adapt to mid-trip hiccups.

Internal automation, saving hundreds of hours per conversion, is the obvious first point of entry, which is why we focus our efforts heavily on this part of the customer journey. As operators know, it can be difficult to sustain healthy margins whilst selling someone else's product. In the high-touch travel sector, when you are creating custom itineraries for each guest, it is very hard to provide boutique service at scale — until now.

2. Travel will become cheaper and more accessible than ever before

The ability to spot deals and system glitches will be democratized beyond the current websites. Savvy developers are already doing this for flight and hotel booking, receiving notifications of pricing glitches combined with pre-programmed agents to capitalize on price-match booking policies.

As with any industry, when competition increases the price reduces. AI will fast-track the search function of finding every possible travel option and auto-comparing prices. Travel companies will no longer be able to justify unique pricing models which are hidden from the consumer.

Open access to every country on earth. With real-time language translation at extremely high levels of accuracy, every step of the trip — from discovery to planning to local interactions — will be easily navigated, all in your mother tongue.

These changing dynamics present travel companies with an opportunity, and pressure, to get more creative around their value propositions, including creating products that go beyond the now-standardized "personalized itinerary" and are brand new, perhaps even a bit edgy.

3. Luxury travel will become even more exclusive

The luxury market has already been expanding to include a broader and younger audience, forcing the once luxe travel sector to become the ultra-luxe sector. We believe this chasm will only continue to broaden, along with the universal access to information fuelled by AI.

It's all about information at the end of the day. After the dotcom era, information access was democratized to the next level — but you still had to know where to look, and what to look for. Now, you only need an internet connection and a dream.

With AI crawling the entirety of the web for potential trips, activities, reviews and social media, the only way left to protect those golden itineraries for high-end clients will be to keep them private. The genuine luxury traveller tends to seek places off the beaten path, but with those places becoming accessible, unique spots are going to get harder and harder to find.

Cultural immersions will need to go deeper. We predict those types of experiences will become far more common — see the rise of plant-medicine tourism in South America.

4. The in-person premium and emphasis on transformation

In line with the growth of experiential travel, and experiences in general: as technology becomes an integral part of almost every area of our lives, the need to step out of "the matrix" will intensify.

Beyond the digital detox and the customized wellness plan, value-added services provide starting points but are not transformations in and of themselves. For transformations to take place, there needs to be a dedicated and qualified human focused on bringing about a specific type of transformation over a period of weeks, not days.

This means the journey begins before the trip and ends after guests have returned home, as retreat leaders know all too well. Travel operators will need to expand their current version of the customer journey into something more holistic.

In Conclusion

We believe a shift to in-person interactions along the entire customer journey will become the norm. Travel companies may start regularly providing what was once an additional value-added service themselves, instead of outsourcing to suppliers.

In an age where machines are taking over a large part of where and how humans have previously been interacting, the value of genuine human connection will rapidly increase, and the demand for authentic experiences stands to be at an all-time high.

The future is bright, and uncertain. If your company is looking to stay ahead and ensure business continuity, book a call with us today.