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Trends Set To Redefine the Travel Industry

Features & Advice Guest Author February 04, 2021

Couple relaxing on an island beach
Relaxed policies are key in the current climate. (photo via Viktor_Gladkov/iStock/Getty Images Plus)

This article was written by Ian Knox, Vice President, Product & Marketing at Expedia Partner Solutions (EPS).

Facing one of the most challenging waves of disruption since the tragic events of 9/11, travel companies have had to adapt themselves to survive. Now a full year since the pandemic began, the question isn’t will travel come back, but what will recovery look like?

The following five trends, underpinned by emerging technologies, are poised to redefine the travel industry in the coming year:

Trend 1: A new wave of innovation will hit the mainstream.

While 2020 will be known for significant disruptions to travel, one positive outcome of the crisis was how it motivated organizations to accelerate technology development, particularly the digitization and automation of travel.

In the accommodation and air travel sectors, the need for social distancing has helped speed up administration tasks such as check-in, food ordering, invoice retrieval and refunds processing, online. In 2021, we expect contactless check-in and the use of smartphones throughout the travel experience to become the norm, with new and faster integrations making everything more seamless.

In a similar vein, while artificial intelligence (AI) has existed for decades, COVID-19 has amplified the need for quicker response times and increased personalization, thus accelerating the use of AI in travel. AI-powered virtual assistants are streamlining the booking process and freeing up time for human connections between providers, agents and travelers.

Overall, it will be the adoption of innovation that will really define the coming months. Travel companies that act quickly to embrace new digital services will reap the rewards; those that don’t will soon be left behind.

Trend 2: Trusted advice will be a major competitive differentiator.

In the travel industry, trust has become more critical than ever before. The climate of uncertainty created by COVID-19 has meant that travelers are increasingly seeking out trusted brands to help them navigate the complexities of new travel regulations.

A December research study revealed a 25 percent increase in travelers using online travel agencies and a 20 percent rise in using destination websites for information about their trip when compared with pre-COVID-19 levels. The same research found that travelers were also looking to return to what they consider ‘trusted accommodation’, showing the importance of trust as travel recovers.

Throughout 2021, we expect advice from trusted providers will be a major competitive advantage, with travelers rewarding those that equip them with on-demand access to reliable information on health and security measures, especially through digital channels.

Young couple shaking hands with a female agent
Trusted advise will be important moving forward. (Photo via seb_ra / iStock / Getty Images Plus)

Trend 3: The barrier will break on loyalty programs.

Airlines and hotel groups have used their loyalty programs to generate demand in response to challenging economic headwinds. As a result, expect a significant surge in travelers booking with the air miles and points they have been unable to use during the pandemic. With extended loyalty programs and innovative new offers, there will be intense competition this year, and the value of air miles and loyalty points will fluctuate. Travelers will look to leverage the expertise of travel partners to navigate this.

Trend 4: Travelers will demand a new era of flexibility.

Building flexibility into future bookings is crucial for travel providers in their efforts to build trust, and early evidence suggests that the industry is listening. For example, in September, American Airlines, Delta and United took the major step of permanently eliminating change fees.

Recent research supports this with seven in 10 travelers stating they will look for flexibility in the next 12 months in the form of travel insurance and trip protection, full cancellations and refunds on transportation and accommodations.

Several online travel agencies (OTAs) and search engines now offer the option to filter properties according to whether free cancellation is offered, with details on trip protection, and postponement policies becoming a critical part of travel in the COVID era. This shift in traveler expectations will prompt other providers to follow suit, ensuring flexible bookings are part of their service, whilst technology will continue to play its role throughout, with travelers reassured by the ability to easily manage their plans online themselves.

remote work and study program
Grand Velas Riviera Nayarit is offering a remote work and study program. (photo via Velas Resorts)

Trend 5: Extended stays will explode in popularity.

After a year of stay-at-home orders and border restrictions, many of us are experiencing a pent-up desire to travel. As COVID-19 vaccination programs roll out worldwide, consumer confidence will grow.

We expect a large proportion of people will forego holidays in the first half of the year and save their allocation for longer, far-flung trips over the summer months. After being denied travel for so long, people are hoping to make the most of their first trip. Travelers may be willing to spend more, travel to new locations or stay somewhere out of the ordinary.

Similarly, after 12 months of working flexibly from home, others will opt to take an extended stay – or ‘workcation’ – in another part of the world. Either way, travel companies that specialize in or can flex their products and services to longer-term trips will be well-positioned.

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Summary | 6 Annotations
Facing one of the most challenging waves of disruption since the tragic events of 9/11, travel companies have had to adapt themselves to survive. Now a full year since the pandemic began, the question isn’t will travel come back, but what will recovery look like?
2021/02/04 14:44
Trend 1: A new wave of innovation will hit the mainstream.While 2020 will be known for significant disruptions to travel, one positive outcome of the crisis was how it motivated organizations to accelerate technology development, particularly the digitization and automation of travel.
2021/02/04 14:45
Trend 2: Trusted advice will be a major competitive differentiator.In the travel industry, trust has become more critical than ever before. The climate of uncertainty created by COVID-19 has meant that travelers are increasingly seeking out trusted brands to help them navigate the complexities of new travel regulations.
2021/02/04 14:45
Trend 3: The barrier will break on loyalty programs.Airlines and hotel groups have used their loyalty programs to generate demand in response to challenging economic headwinds. As a result, expect a significant surge in travelers booking with the air miles and points they have been unable to use during the pandemic. With extended loyalty programs and innovative new offers, there will be intense competition this year, and the value of air miles and loyalty points will fluctuate. Travelers will look to leverage the expertise of travel partners to navigate this.
2021/02/04 14:45
Trend 4: Travelers will demand a new era of flexibility.Building flexibility into future bookings is crucial for travel providers in their efforts to build trust, and early evidence suggests that the industry is listening. For example, in September, American Airlines, Delta and United took the major step of permanently eliminating change fees.
2021/02/04 14:45
Trend 5: Extended stays will explode in popularity.After a year of stay-at-home orders and border restrictions, many of us are experiencing a pent-up desire to travel. As COVID-19 vaccination programs roll out worldwide, consumer confidence will grow.We expect a large proportion of people will forego holidays in the first half of the year and save their allocation for longer, far-flung trips over the summer months. After being denied travel for so long, people are hoping to make the most of their first trip. Travelers may be willing to spend more, travel to new locations or stay somewhere out of the ordinary.
2021/02/04 14:45