As we stand on the cusp of the fourth industrial revolution, artificial intelligence (AI) is poised to transform various sectors, and the travel industry is no exception. The global AI in the travel and tourism market is expected to reach $12.56 billion by 2027, growing at a CAGR of 26.3% from 2020 to 2027, according to a report by Allied Market Research. This article will explore how AI is reshaping the travel industry and highlight a few startups leading the charge.
AI and Customer Service
AI’s impact on the travel industry is multifaceted, with its applications ranging from personalized recommendations to automated customer service. AI-powered chatbots, for instance, are revolutionizing customer service by providing 24/7 assistance, reducing response times, and freeing up human resources for more complex tasks. According to a study by Juniper Research, chatbots are expected to bring cost savings of over $8 billion annually by 2022, up from $20 million in 2017.
Personalization Through AI
Personalization is another area where AI is making significant strides. AI algorithms analyze vast amounts of data to understand customer preferences and deliver personalized travel experiences. This includes tailored travel recommendations, targeted marketing, and dynamic pricing. A report by Boston Consulting Group states that brands that create personalized experiences by integrating advanced digital technologies and proprietary data for customers are seeing revenue increase by 6% to 10%.
AI Startups Reshaping the Travel Industry
Several startups are leveraging AI to disrupt the travel industry. Here are eight notable ones:
- Hopper (Canada, $729.7M funding): Hopper uses big data to predict and analyze airfare, providing travelers with the information they need to get the best deals on flights.
- Expedia (USA, $3.3B funding): Expedia Group supports global travel with its suite of online products, and the company is making trip planning even easier with its AI travel agent.
- Mezi (USA, $11.8M funding): Mezi is an AI assistant for all your travel needs, from booking your flight and hotel, to figuring out what to do, to handling your online check-in or changes of plans, to being your on-the-ground guide when you arrive.
- Roxy (USA, $2.2M funding): Roxy creates intelligent, conversational devices for hotels and local businesses, providing patrons with on-site information and services.
- Emma.ai (UK): Emma.ai develops a travel assistant powered by AI.
The Vision of AI in Established Travel Companies
Even established companies in the travel industry are recognizing the potential of AI. In a recent earnings call, Airbnb’s CEO Brian Chesky shared his vision for AI within the company. He expressed the ambition to create the ultimate AI concierge, capable of providing personalized advice to each user. This is a departure from the approach of chatbots like ChatGPT, which offer standardized responses to queries, regardless of the user.
As AI continues to evolve, its impact on the travel industry will only grow. From improving customer service to personalizing experiences and optimizing pricing, AI is set to revolutionize the way we travel. The future of travel is here, and it’s powered by AI.
Hi, I’m Oren, founder at BIGINTRO, a content strategy agency that helps B2B companies drive growth. We develop search, social, PR, and content marketing strategies tailored to business goals. I also have a dog named Milo.