AI & tech $9trn
The value of the T&T sector.
Statista
It’s hardly surprising that the WEF is interested in the impact AI might have on T&T. Since 1971, the organisation has provided a platform to bring together public and private partners to work through structural challenges on a global scale. Half a century on, the Swiss-based body now has an entire research centre dedicated to solving issues thrown up by technological advancement. Efforts here can range from looking at how AI interacts with manufacturing in Turkey to how policy formulation in Rwanda is making space for this much-hyped technology. And attention has also turned to how this impacts decisions and opportunities in the hotel space.
Indeed, in the first sentences of The WEF’s Travel
& Tourism Development Index 2024 (TTDI) – an index that tracks the performance of an individual country’s T&T sector – AI is cited as a major challenge, one that the sector must grapple with just as it is recovering from the impact of Covid-19. Professor Iis Tussyadiah, dean of Surrey Business School and a lead author and researcher on the TTDI, adds that managing AI effectively isn’t only so those operating in this space can seize new opportunities but so they can have a positive impact outside of sector operations: on social equality, resource management and the climate. Though she says this will be difficult. “AI is already being implemented into travel and tourism (T&T) in ways people don’t realise,” she adds. “Some countries are finding it a challenge – but others are finding opportunity.”
From Davos to damage limitation By Tussyadiah’s thinking, the WEF’s own travel planning could one day be upended by AI. Though discussion of this technology was undoubtedly centre stage at the organisation’s annual conference in Davos, Switzerland – one of the foremost examples of non- leisure travel in the events calendar – planning for how this headline-making might be, one day, driven by non- human computations is hardly keynote-speech-worthy. However, as Surrey Business School’s dean suggests, AI can offer a strategic vantage point, especially in the planning stages. She offers the example of how AI can be used to guide travellers around a resort or country, to help manage the impact on community or resources. Something that might be also undertaken on a country- wide scale. Indeed, over the past year, protests from locals in Spanish tourist destinations, from the Canary Islands to Barcelona, unhappy with the way tourist flows are impacting housing supply and community, show how needed this is. “AI can be used to help navigate tourists and disperse them – helping make travel sustainable,” she says. Could Davos – with its multi-million spend on security details, the need to protect and ferry around circa 2,500 global leaders, as well as planning for terrorism and assassination eventualities – soon also get the AI planning boost?
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The answer could be well, yes, it might. “The T&T sector has always been pioneering in the implementation and application of technology,” says Tussyadiah, pointing to how platform companies like Airbnb and Uber changed travel intermediation and access to transport and accommodation (though she is clear to point out this is not without downsides, too). There’s certainly a need to be future-thinking.
Though GDP in T&T, as a whole, was expected to hit pre-pandemic levels by the end of 2024, there are still major barriers to progress. Non-leisure travel demand, such as that on display at Davos, is still lagging. Furthermore, there are still labour shortages in the sector, infrastructure issues, and a disconnect between demand and offered air routes and capital investment. There are broader concerns about how the wider picture of unstable geopolitics and macroeconomics plays into T&T, and how the sector itself impacts socioeconomic equitability and the environment. But there are reasons to suggest technology, at least, is helping. Tussyadiah explains how improved mobile connectivity and smartphone payments have helped SMEs access T&T opportunities. Indeed, the latest TTDI rankings correlate broader ICT readiness with outsized performance. Often for low-to-middle-income countries such as Uzbekistan, Côte d’Ivoire and Indonesia. “In developing countries, they are faster at implementing new technology, and that allows tourism to flourish again [post-pandemic],” Tussyadiah says. The TTDI also charts how critical ICT readiness is to the growth of T&T, finding that since 2019, 97% of countries have shown positive momentum in this area, largely driven by improved online accessibility, higher use of digital payments and more online booking. Positively, this has the potential to lower the barrier to entry into T&T says Tussyadiah, benefiting SMEs by allowing them to access new customers, optimise operations, enhance visitor engagement and learn more about their customers. “[Digitalisation] allows these businesses to develop their products and services accordingly,” she adds.
Travelling towards sustainability But there is a risk with digitalisation – AI incumbent within this. The 2024 TTDI notes that with the pandemic in the rearview mirror, there’s a risk that visitors to countries don’t benefit or impact different groupings equally. Furthermore, growth, especially for lower-income countries, doesn’t always provide higher- wage jobs. And any digital headway could further complicate issues such as access to employment or gender parity. Consider that the Middle East and North Africa region is 36.4% below the mean for gender parity but many countries in the region (the UAE, Saudi Arabia, Qatar and Bahrain) are charging ahead with
Hotel Management International /
www.hmi-online.com
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