• Generative AI in travel: Game changer or hype?   

Excerpt from WIT

Industry leaders weigh in on the real-world potential of GenAI in travel and hospitality

Speculation surrounding the potential of generative AI to ‘revolutionise’ the travel industry was rampant in 2023, yet tangible applications weren’t popping up the way GenAI advocates had hoped they would. As we progress into 2024, questions arise regarding whether this technology will meet expectations or fall short.

Some analysts have already labeled generative AI as ‘overhyped’, anticipating a reality check in 2024 due to unrealistic expectations, high costs, and regulatory hurdles. To gain insight into the actual impact of generative AI on travel this year, Belvera Partners consulted technology experts from various sectors within the industry.

Mike Coletta, Research and Innovation Manager at Phocuswright, opposes the pessimistic outlook, emphasising the immense potential of AI to reshape the travel experience for both travelers and providers. “The travel industry in on the cusp of massive change, and there’s huge potential for AI to transform the travel experience for both travelers and the travel provider ecosystem,” says Coletta. 

“Phocuswright research shows that nearly half of travelers in most countries would be extremely or somewhat comfortable using a GenAI tool to help them plan a trip. Between 13-22% of total traveler populations have used GenAI in some capacity. As the industry moves beyond the initial hype, 2024 will be all about leveraging what has been learned so far to focus on the most beneficial use cases – and avoid wasting resources on those without a clear ROI. Travel companies in 2024 are expected to accelerate investment in generative AI applications. But separating the winning use cases from the losers will be an ongoing process of trial and error. At this juncture, a results-based approach is needed to highlight the most relevant and impactful use cases in travel.”

Meanwhile, Haluk Kayhan, CEO & Co-Founder of Bedsopia, highlights the necessity of addressing real operational challenges rather than pursuing solutions for hypothetical problems. Kayhan says, “AI could be hugely transformative for travel in 2024, but the industry needs to work out where it is most needed and avoid trying to solve problems that no one knows they even have.  Focus on the real headaches or high-cost / low return areas of your operations like staff shortages, flight disruptions, sudden waves of cancelations, payments processing and operational inefficiencies generally.  These are areas where AI could catalyze the most change, most quickly – perhaps even meaningfully in 2024.  AI technology needs to be essential at this stage, not just a gimmick.  Let’s be realistic – it’s not going to change the whole world overnight – people aren’t ready for that.”

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