The future of travel and tourism is likely to be shaped by companies and destinations that provide unique and meaningful experiences, utilise networks, provide personal service to sustainability-minded consumers, and are led by responsible leadership, according to a new report by the World Travel & Tourism Council (WTTC) and Bloomberg Media Group.
The report, titled ‘World, Transformed: Megatrends and their implications for Travel & Tourism’, examines how powerful global demographic, political, economic and technological forces are impacting the travel and tourism landscape, producing different expectations among consumers, obligations for businesses and policymakers, and opportunities to succeed.
Major trends that emerged in the report include:
- Consumers are increasingly moving beyond experiences as social currency to seeking shared experiences to deliver meaning, self-improvement and stronger connections.
- Millennials and Generation Z have little loyalty to employers or brands and are more likely to rely on personal networks than experts.
- Consumers value technology but are uncomfortable with over-automation, which seeks to replace customer interaction with intelligent bots.
- Consumers want to be treated as individuals by companies that trust their privacy, share their values, and provide authenticity.
- Travel and tourism companies will succeed by responding to the rise of ethical consumption trends and protecting the very destinations they promote.
The report also identifies five areas where change will be most significant across travel and tourism:
- Reality, enhanced: As people, communities and businesses become more sophisticated in adapting new technologies for analogue experiences, new ideas and beliefs are emerging about how best to live a connected life. Online and offline experiences as a result are becoming increasingly integrated. More than $8.2 trillion in global expenditure is forecast for the experience economy, in addition to an increased emphasis on physical and mental wellbeing. With experiences at the core of travel and tourism, the sector has the potential to design meaningful, unique, frictionless and even unplugged journeys that directly respond to these changing values.
- Life, restructured: The growth of tech-powered economies such as the “gig economy” and “sharing economy” continues to create new expectations for work, life and culture. 25% of workers in the US and Europe engage in independent work today, and the independent workforce is going to rise. As the structure of people's lives become more fluid and self-directed, travel will become more of a lifestyle, mobility will increasingly become communal and service-based, and businesses will need to rethink their workforce.
- Data, revolutionised: The power of data will drive a new frontier of innovation and deliver unprecedented ability to better understand and predict outcomes. While over 180 ZB of data is expected to be generated by 2025, consumers remain uneasy when it comes to their security and privacy. These technologies offer opportunities for the travel and tourism sector, including leveraging data to build a fluid, cohesive travel experience, implementing large-scale Internet of Things, facial recognition and use of voice assistants to streamline travel. Businesses will need to lean into brand values to guide their innovation and prioritise transparency with their consumers.
- Power, redistributed: Significant shifts in power dynamics will have effects on both local culture and global markets as technology, globalisation and population growth continue to redistribute power. These forces create new centres of social and economic influence in the East and South. For travel and tourism organisations, merely establishing presence in new markets won't be enough as it will be critical to understand the future consumer. Businesses will need to invest in creating shareable moments, strive for customer service excellence and ensure their brand has a point of view in the global, social discussion.
- Consumption, reimagined: As the availability of resources and health of our planet are increasingly threatened, there is a need for responsibly balancing short- and long-term priorities. By 2050, the global population will exceed 9.7 billion and consumption of natural resources will triple. Sustainable business practices and aligning brand stories to sustainable solutions can become the core of a robust growth strategy for the travel and tourism sector. Safeguarding destinations, environmental leadership and community health will therefore be integral to the customer experience.
To download the full report, click here.