With COVID-19 restrictions lifted, the travel and hospitality industry is experiencing a significant rebound in 2023. The Mastercard Economics Institute reveals global leisure travel is up by 31% in March 2023 vs 2019. Travel and hospitality brands competing to attract and retain customers know that customer experience (CX) is a crucial factor in this highly competitive space.
According to PR Newswire, 56% of customers stated that they would be ready to pay a premium price for a product or service if the brand provides outstanding customer support. Clearly, customers want to explore new destinations across the world but give precedence to convenience and seamless experiences. To cater to this demand, travel and hospitality companies are revamping their CX strategies to attract new customers and retain existing ones. As a result, leading brands are turning to digital solutions to deliver experiences that set them apart.
The travel and hospitality industry has always been built on exceptional CX as a key differentiator. However, the COVID-19 pandemic put unprecedented pressure on the travel and hospitality sector creating new challenges and exacerbating old ones:
Shifting customer loyalty: According to a McKinsey consumer survey, the COVID-19 pandemic made customers more willing to experiment with new brands and experiences, with twice the likelihood of trying them compared to before the pandemic. The survey found that 75% of U.S. customers tried a different store, website or brand during the pandemic. This trend is significant for the travel sector, which relies heavily on customer loyalty programs.
The pandemic - The decrease in travel resulted in a decline in revenue. It also led to a change in consumer behavior, with many guests now prioritizing safety and hygiene when making decisions.
Personalization expectations: The core offering of the travel and hospitality industry is experience. Consumers highly value personalization in this space and the ability to create personalized experiences plays a vital role in customer loyalty, lifetime value, brand reputation and repeat business. Seventy-nine percent of customers feel that personalized service from a brand is more important than personalized marketing. However, a combination of a lack of data, siloed data, privacy concerns, strict data policies and complex customer journeys can make it challenging to effectively create personalized experiences.
Siloed teams: With so many stakeholders involved in hospitality, including airlines, hotels and destinations, it can be difficult to ensure consistent communication across all the touchpoints of the customer journey. Customers expect clear and concise communication, especially when it comes to disruptions and changes.
Managing online reviews: In today's digital age, online reviews play a critical role in shaping a guest’s decision-making process. Most guests are mobile phone users, meaning the opinions of fellow travelers and diners are at their fingertips and many place more trust in user reviews than official business communication. Therefore, travel and hospitality providers must actively monitor and manage their online reputation, promptly responding to customer feedback and addressing any issues that arise. Failure to do so can result in negative reviews, which can deter potential customers and harm a business's bottom line.
Keeping pace with the technology landscape: The travel industry has a lot to gain by employing modern digital systems to deliver excellent customer experience. With changing consumer preferences after COVID-19, it's more important than ever to provide seamless and personalized experiences to stay competitive. Many travel companies have started using artificial intelligence to offer personalized recommendations and provide customer support 24/7. Those who fail to take advantage of new technology risk falling behind their competitors.
Contactless solutions meet two important guest needs in a single step.
COVID-19 fast-tracked contactless experiences from paperless menus to keyless room entry. Post-pandemic, guests continue to be health conscious. As a result, contactless experiences continue to be a top trend in the travel and hospitality industry.
Besides health concerns, contactless experiences meet a growing consumer expectation that good experiences are fast, hassle-free experiences. PWC reveals nearly 80% of U.S.-based consumers cite speed and convenience as essential elements in a positive customer experience.
While contactless technology is fast becoming a must in the travel and hospitality sector, brands must also consider how to find ways to deliver contactless experiences that maintain a personal touch.
Automation and AI
From answering common queries, booking and canceling flights, and providing travel-related information, travel and hospitality customers are familiar with AI-powered chatbots and virtual assistants providing instant support. This enables brands to deliver faster and more efficient service, increasing customer satisfaction and driving cost efficiencies.
As AI technology advances, the travel and hospitality sector has the opportunity to meet guests’ expectations by taking personalization to the next level. To achieve this, connecting chatbots and other self-service solutions to customer and business data is essential. In the future, personalization won't be limited to the experience of booking a hotel room or dinner table, it will continue on through the holiday or meal creating a personalized end-to-end experience.
In addition to personalization, Automation and AI eliminate human errors in the booking and scheduling process, which can reduce customer frustration and dissatisfaction. Automated systems ensure customer details are accurate and that bookings are made according to the customer's specifications, reducing the risk of errors or misunderstandings.
Continuous innovation and authenticity
In an increasingly complicated landscape, businesses in the travel and hospitality sector must innovate continuously to stay ahead of the curve. Many brands are experimenting with extended reality technologies, such as augmented reality (AR) and virtual reality (VR) to provide their customers with more distinctive and meaningful experiences. In a world of contactless transactions, extended reality creates an opportunity to connect on a more human level. Customers are also looking for authentic experiences, from local cuisine to unique cultural experiences. Travel and hospitality businesses must find ways to promote local experiences and provide customers with a true sense of the destination they are visiting. Combining intelligent routing and the rise of remote working in the contact center, high-value interactions can be routed to local agents who can describe a hotel’s local environment or a venue’s attractions more authentically, Alternatively, virtual reality can immerse agents in a resort almost as if they had been there, enabling them to share its facilities more authentically to potential guests.
CX is a powerful differentiator in the travel and hospitality industry. Companies that prioritize and invest in CX will have a competitive advantage in the market as a result of shifting consumer preferences and increased market competition. Travel and hospitality brands can increase customer satisfaction and encourage brand loyalty by utilizing technology to support agents and provide unique, tailored experiences.
To discuss how you can enhance your brand’s CX strategy, contact us.