Where will artificial intelligence take the global travel industry?

AI and its application in the tourism business is a top talking point but it's hard to see it living up to the hype

Tourists on Mai Khao Beach in Thailand. The rise of AI will improve travellers' booking experiences, according to experts. Getty Images

Laying on a beach, relaxed in the sun and listening to the waves gently lapping on the shore may be many people’s idea of the perfect holiday. The flipside is days of deflated fatigue after too many hours organising and selecting something that has not lived up to its billing.

A digital companion could change all of that, or at least, that is the hopes of the travel industry as it adapts to artificial intelligence (AI). By 2030 its predicted that you will simply be able to command your computer-based persona to select the best options for your holiday criteria, and book and pay for it.

Sorely needed

A 2019 survey commissioned by Hotels.com of 7,800 tourists across 26 countries found holidaymakers took an average of 10 hours to book a vacation and started to lose interest just 42 minutes into the search process.

A smart agent who understands me and goes out and fetches stuff for me will be a bit like television. It’ll come to me.

Timothy O'Neil-Dunne

A quarter gave up because it was too tiring. Four in 10 said they would be willing to pay more not to have to research all the vacation possibilities, and 37 per cent said they had made a mistake in the final booking.

A smoother passage to the beach is also on the cards behind the scenes. Airlines use AI in scheduling and baggage handling, and transfer and check-in at your hotel will be personalised and hassle free, thanks to the hotel’s AI concierge.

“AI is on the cusp of transforming holiday travel," Adam Harris, co-founder and chief executive of hospitality technology company Cloudbeds, told The National. "Imagine seamless booking with tailored recommendations around the clock, like a curated itinerary alongside targeted promotions.

"Once at the destination, technology will help personalise each moment, from customised room amenities and upgrades to exclusive local experiences. This intelligence is already here, empowering travellers with greater control and flexibility."

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The application of AI in the global tourism industry was a much-discussed topic at this month's World Travel Market (WTM) in London. AI is already in widespread use across various sectors from chatbots on booking websites to algorithms used to guide consumers on when the best time is to purchase airline tickets.

The WTM’s portfolio director, Jonathan Heastie, told the conference that “AI has the power to transform tourism as we know it”.

The end-to-end traveller experience should be enhanced and increasingly personalised as AI technology becomes more a part of the travel industry landscape. The likes of Google Travel and Trip Advisor are using machine learning with the aim of individualising personal preferences in travel itineraries.

The traditional role of the human travel agent has already been substantially replaced by AI, as the technology searches for travel information and creates optimised itineraries. “Over the next decade, almost certainly earlier rather than later, AI is going to allow anyone to build amazing, personalised, travel experience options,” Chris Jensen, co-founder of TravelAI, told The National.

AI will know so much about us, our personal circumstances and tastes, as well as our spending habits, that it will offer to book our holidays before we have even thought of them. In addition, given that travel itself can still be stressful, AI will make the process seamless and be able to foresee and solve problems in real time.

The beach in Oludeniz, Turkey. 'AI is on the cusp of transforming holiday travel,' said Adam Harris, co-founder and chief executive of Cloudbeds. Getty Images

Connecting the trip

Where AI will come into its own in the travel industry is through number crunching in real time, allowing for booking systems to find the best prices for hotels and flights at any specific time. This dynamic pricing capability matches supply and demand, making price discovery more efficient for consumers and travel companies. “We currently have the disconnected trip,” Timothy O'Neil-Dunne, a founder of Expedia, told The National. “The chances of you being able to buy everything in the same place is actually very small.

“A smart agent who understands me and goes out and fetches stuff for me will be a bit like television," he said. "It’ll come to me. That’s where you’ll see a subtle change. The stress and the effort necessary to do the booking will be reduced directly as a result of AI.”

Timothy O’Neil-Dunne, principle at T2Impact and a co-founder of Expedia, at World Travel Market in London. Matthew Davies / The National

Implementation of some AI will take longer given the fractured nature of datasets in the travel industry and the fact that it will be sitting over technology that in many cases is decades old. For Roman Townsend, managing director at Belvera Partners, the “biggest challenge is with legacy technology”.

Airline data

“At its core, the booking platforms are legacy technology in the hotels and particularly in the airlines,” Mr Townsend told The National. “Some of these systems go back to the 1960s and 1970s, a lot of them still have physical data centres and some of the processes they have go back to an IATA meeting in 1947. So, a lot of it is not really fit for purpose, but they can’t make that shift overnight. So, you’re trying to build a skyscraper on the foundations of a cottage.”

Mr O’Neil-Dunne feels a generational shift in technology development needs to occur for AI to truly be effective in all industries, not just travel. He uses an analogy of horses and cars. “What I’m driving at here,” he told The National, “is people are still trying to build faster horses."

Experts agree that AI is set to revolutionise the travel industry through myriad different areas of the traveller experience, including not just efficient and tailor-made booking and highly personalised itineraries. Improved security and language translation offer other boons.

The Saudi Pavilion at the World Travel Market 2024 in London. Matthew Davies / The National

AI is already starting to make the initial search simpler, and that can only become more effective in the near future.

Tim Fainsinger at Front, a tech company that built an AI-powered, all-in-one customer service platform for the tourist industry, told The National the experience should be more streamlined with fewer clicks. “It’s going to enable humans," he said. "You’re not going to be able to cut out the human completely. AI is supposed to make the human’s life easier.”

Hype abounds

As with many industries, AI has created a significant buzz in the travel sector and investors are getting excited about the prospects. For example, just this week the Spanish travel tech start-up, Acai Travel, announced it had attracted $4 million in seed money to use AI to further develop its platform that boosts the efficiency of travel call centres and is used by the likes of Kiwi.com, lastminute.com and Goway.

However, like with so many other industries, travel experts are warning not to get caught up in the hype. “There’s definitely a lot of hype and I don’t think we’ll be seeing some brave new world,” Mr Townsend said. “I personally am a bit of a sceptic with all these new technologies and how the promise is enormous and what we could be doing many years from now, but you’ve got to think what are we doing here and now, and is it going to help us solve our problems?"

Likewise, Mr O’Neil-Dunne emphasised the need to avoid getting overly fanciful with predictions of what AI will do for the future of travel. “AI is not the only answer, because you have to look at the whole, rather than just one thing,” he told The National. “If you’re looking at AI, you’ve got to be able to understand what AI is.”

Perhaps that element of intangible doubt is why some very important people working in today's tourism warn that ultimately, AI will never replace the human element that is the bedrock of the industry.

Paul Richer, senior partner at the cloud company Genesys, an AI travel industry specialist, told The National a fully automated AI-driven holiday is “entirely feasible” but improbable.

"Travel supplier, airlines, hotels and the like will want to show a friendly face and have human beings there, not just as a comfort to the travellers, but also to have an opportunity for branding, because your people are part of your brand values.”

Haris Theoharis, a member of the Greek Parliament, agreed, telling the WTM that “the centre of the [tourist] experience is the human element”.

Sultan Almusallam, deputy tourism minister for international affairs for Saudi Arabia, told the WTM that the kingdom was “still figuring out how we can use [AI]” while recognising there was a guiding principle that the human element remained extremely important in tourism.

“If you have a digitised hotel now, you won’t be able to interact with the people who are serving coffee or helping you with concierge services,” Mr Almusallam said. “Knowing the stories of people creates unforgettable experiences.”