Internet of Things (IoT) in Travel and Tourism: Industry trends
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Internet of Things (IoT) in Travel and Tourism: Industry trends

By GlobalData Thematic Research 25 Oct 2021 (Last Updated October 25th, 2021 07:25)

The growth of IoT technology is expected to lead to the creation of entirely new business models.

Internet of Things (IoT) in Travel and Tourism: Industry trends
Credit: metamorworks/Shutterstock.com.

Travel and tourism companies will depend on Internet of Things (IoT) technology to create an array of benefits both in internal and external environments.

Listed below are the key enterprise trends impacting the IoT in the travel and tourism theme, as identified by GlobalData.

Internet of Things – personalisation

IoT creates a wealth of data from tourism companies, which in turn allows them to create highly personalised services. According to GlobalData’s Q1 2021 Consumer Survey, 82% of consumers are either ‘somewhat’, ‘often’ or ‘always’ influenced by a service that is tailored towards their needs or personality.

IoT in travel and tourism can create personalised experiences in two main ways: by enabling travellers to control more appliances or services through a centralised device, such as a tablet or mobile application; or by companies storing data gathered from IoT enabled devices to create targeted personalised marketing campaigns or by remembering their preferences for return visits.

For example, a traveller may return to the same hotel every winter. The hotel company using a smart thermostat could set the heating to the customer’s preferred temperature when they return, which is remembered from last year. Such small, personalised services could go a long way for many customers, especially in the luxury market where attention to small details is greater than in the midscale or budget segments.

The increased level of personalisation enabled by IoT also lends itself to seamless travel
experiences, which is something that is of utmost importance to Gen Z. The young age
cohort, which is constantly growing in importance, values services that save time, with 56% of Gen Z stating that services that align with time constraints ‘often’ or ‘always’ influences their purchasing decision.

Enhancement of touristic experiences

Tourism-related companies and destinations can use IoT technology to send location-specific information to customers, which can enhance touristic experiences in the ‘during-trip’ stage. By combining smartphone capabilities with beacon technology or other sensors, messages can be sent to tourists at the point they are most relevant, based on where they are, this would be especially effective on walking tours around a city. When tourists are walking past an ancient ruin, for example, they can be sent a message which describes what they are seeing and what it means in terms of the destination’s history or culture.

Outlined in GlobalData’s Q1 2021 Consumer Survey, 83% of consumers are either ‘somewhat’, ‘often’ or ‘always influenced by how enjoyable/unique service or experience is. The usage of IoT, therefore, offers insight into how the technology can be used in more novel ways, which could also be more family-friendly.

Children may find educational experiences dull on holiday, adding a technological element to the experience through IoT may help to increase engagement.

Location-specific information can also enhance experiences by reducing potential feelings of alienation. Sending location-based messages to travellers at points where they could potentially get lost or may be entering an area where crime rates are high could allow destinations to be proactive in avoiding negative experiences, which increases the chance of repeat visits.

This is an edited extract from the Internet of Things (IoT) in Travel and Tourism – Thematic Research report produced by GlobalData Thematic Research.

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