Future of Tourism and Hospitality PDF

TH2107 Future of the Tourism and Hospitality Industry The Future of the Industry The future is subject to so many imprecise and unknowable variables that everything is possible—which is why there are numerous tourism futures rather than one. In other words, there is an infinite number of futures to...

TH2107 Future of the Tourism and Hospitality Industry The Future of the Industry The future is subject to so many imprecise and unknowable variables that everything is possible—which is why there are numerous tourism futures rather than one. In other words, there is an infinite number of futures to consider for the world and tourism within it. Therefore, predicting tourism futures is not an easy task. The United Nations World Tourism Organization (UNWTO) and other organizations have termed the uncertainty caused by the radical change experienced in the twenty-first century as the ‘new normal,’ suggesting that tourism will never return to the relatively stable conditions in the second half of the twentieth century. The following are some of the possible futures the tourism and hospitality may face (Fayos-Sola & Cooper, 2019): Resources: Eco-efficiency, Sustainability, and Innovation in Tourism Tourism undoubtedly has environmental impacts concerning the extraction of resources, particularly energy, waste generation, and various types of pollution, such as carbon dioxide (CO2) emissions. The various actors involved should minimize impacts, particularly companies and consumers, who should be informed and educated about these issues. Use of natural resources and eco-efficiency in tourism – Tourism has environmental impacts globally and at the regional and local levels. At a global level, it contributes, for example, to climate change and ocean pollution. At the regional level, it may generate problems related to water scarcity, and at the same time, contributes to bringing revenues to nature conservation. At the local level, it can affect the availability and quality of local natural resources. Eco-efficiency is the capability to produce goods and services with fewer amounts of energy and natural resources and wastes and pollutants discharged. The tourism sector has developed measures to conserve natural resources (e.g., water, energy) or areas (terrestrial or marine protected areas). Still, it is not easy to understand the complex relationship between tourism and the environment. It is relevant to understand tourism impacts, as the goods and services provided in tourism often depend on the attractiveness of natural capital, such as wildlife, forests, rivers, beaches, oceans, and climate. Energy efficiency and the use of renewable energy – Tourism has significant market power in the world economy, having a major contribution to regional and national development but offers challenges on environmental issues, as previously discussed. Using renewable energy sources can significantly decrease the environmental footprint of tourism. Still, renewable energy will have to align tourism activities with concepts of green tourism (which consists of tourism activities that can be maintained or sustained indefinitely in their social, economic, cultural, and environmental contexts). In general, many businesses still do not understand how they use and often pay for energy, which is often inefficient and results in both waste and unnecessary expense. Energy efficiency saves energy and costs and reduces greenhouse gas emissions like CO2. Greenhouse gases emissions in tourism activities – The progressive rise of greenhouse gas concentration has led to an increase in the planet's global temperature in the past century. Mainly due to anthropogenic activities like burning fossil fuels and clearing forests, global warming can be devastating to biodiversity and ecosystems. In particular, tourism activities dependent on natural environments suffer in a particular way from the effects of this global warming. This phenomenon can particularly affect the desire of people to travel in places with different climates and tourism mobility, concerned with transport safety linked to natural disasters and diseases. Moreover, some traditional destinations may lose their present appeal or even disappear. Eco-innovation and sustainability in tourism – Eco-innovation is the introduction in the market of new and significantly improved products, techniques, or management systems that avoid or reduce damages to the environment. Environmental innovation is a new or significantly improved good or service, process or organizational method or marketing method that creates environmental benefits compared to alternatives. The term eco-innovation, also known as environmental innovation, green innovation, or sustainable innovation, has been used to recognize the innovations that contribute to a sustainable environment through ecological enhancements. The importance of eco-innovations for 09 Handout 1 *Property of STI  [email protected] Page 1 of 5  TH2107 restaurants and hotels is confirmed by Alonso-Almeida et al. (2016) in areas such as energy, recycling, water, new construction development, interior design, engineering projects, responses to external environmental degradation, new products, processes, and business models, adaptations of products and existing materials, new materials, the use of eco-biological products, and spatial planning. This can be seen in some regions with the development and transformation of organic products, eco- tourism, and therapeutic tourism in the wellness industry. All tourism sub-sectors and typologies must engage in eco-innovation adoption and development. If tourism is dependent on the value of the environment, activities pursued should constantly ensure its sustainability. However, policies and tourism development strategies do not always sufficiently consider these issues. Thus, research on eco-innovation, development, and sustainable tourism is important, topical, and mandatory to provide good policy implications for future designs within the sector. The Deepening Effects of the Digital Revolution In the case of travel and tourism, the impact of information and communication technologies and the Internet is particularly significant, bringing a new digital economy, new actors, new “rules of the game,” new business models required, and increasing level of interaction with all of the people involved. A digital economy is based on a completely new infrastructure with new capabilities (telecom networks, hardware, and software), a new way of doing e-business, and the development of e-commerce. Major digital forces that are changing the tourism industry – This digital age is driven by a series of trends that create a feedback loop and demonstrate the rapid acceleration of the digitization of society and the tourism industry. These include the continuous growth of the internet, mobile networks and smartphones, the internet of things (IoT), big data, new cloud services (cloud allows the storage of information on Internet servers), smart wearables (a category of electronic devices that can be worn as accessories, embedded in clothing, or implanted in the user's body), 5G mobile technology, social networks, and artificial intelligence (a branch of computer science concerned with the attempt to develop complex computer programs capable of performing difficult cognitive tasks). Effects of the digital revolution on the travelers’ cycle – Companies and tourists are using this technology more, interacting with each other to improve their bottom line on one hand and get more out of their trip on the other. The travelers' cycle includes the pre-travel stage (the world wide web, and all the new online agents radically transformed how travelers choose a destination, plan and organize a trip, look for information, make reservations, find ways around the destination, and express opinions), during travel stage (technology used on actual travels such as Near Field Communication [NFC, a short-range wireless communications technology for sharing data between devices], using mobile technologies to check-in and check-out of hotels, and more), and after travel stage (the end of the journey that involves travelers talking about their experiences, sharing it with friends on social networks, or posting about it on their blog). Tourism and Economics: Technologically Enabled Transactions The global economy has experienced several rounds of ups and downs in different regions since the beginning of the new millennium. Three (3) paradigms are recognized as the main forces of change: globalization, ecological economics, and the internet economy or “network economy.” The paradigm of globalization – For years, the international flow of goods, capital, people, and knowledge, has continued to expand significantly, particularly the movement of people for tourist experiences. This phenomenal growth of international tourism can be primarily attributed to globalization. Countries have realized the economic and social benefits of tourism, improved infrastructure and services, and promoted tourism by facilitating easier entry. This phenomenal shift in the globalization of tourism provides a fertile field for tourism studies and challenges for investment, development, and management. The paradigm of ecological economics – As globalization continues to advance and countries push for economic development through tourism, the demand for natural resources has intensified. Tourism is an economic sector that is affected by climate change in terms of lost resources and generates an 09 Handout 1 *Property of STI  [email protected] Page 2 of 5  TH2107 impact on climate change through transportation services, lodging accommodations, and tourist activities. On the one hand, climate change is blamed for the rise of sea level, melting snow and glaciers, water shortage, and loss of biodiversity, the essential resources tourism is built on. The transportation of tourists by airplanes, buses, trains, and cars is identified as the major contributor to carbon dioxide emissions that affect climate change. As the main contributor to carbon dioxide emission that has caused global warming, the air transportation sector needs to consider the balance of development and ecological sustainability. Adaption to climate change and mitigation of global warming are recommended as practical approaches to business and ecological sustainability. The paradigm of the internet economy – With rapid technological innovation and advancement, the Internet has played an increasingly important role in all facets of society. At the turn of the millennium, the Internet economy became an area of economic studies because of its application, commercialization, and impact on government, commerce, and society. The tourism industry quickly leveraged Internet technology to organize and provide travel information online. Price, a greater range of products, and convenience are the main motivations of online travel consumers. The phenomenal development of digital technology and electronic commerce became disruptive forces to the traditional, physical travel service providers, as consumers opted to go to Expedia.com, Booking.com, TravelSupermarket.com, and meta sites such as Kayak.com for their travel needs. Technology The term technology is defined as ‘the branch of knowledge that deals with the creation and use of technical means and their interrelation with life, society, and the environment, drawing upon such subjects as industrial arts, engineering, applied science, and pure science’ (Dictionary.com, n.d.). Today, nobody doubts that technology and travel are the perfect combinations. This joint force also plays a crucial role in the way people travel, including the destinations they choose, what they do when they arrive, and even after returning from their travel. According to a Google Travel study, it is so prevalent that more travelers plan their trips using the Internet than going to travel agencies to prepare for them. The following are the most important tech solutions for the tourism industry (Vidal, 2019): Mobile technology – The cellphone has become travelers’ tour guide, travel agency, best restaurant locator, map, and more. It has been on the travelers’ side during their travel purchase journey. This is why tourism businesses must adapt their services and communications to these devices. KLM, for example, has already created an information service for passengers using Facebook Messenger. With this system, once a customer makes a reservation, the information regarding his/her ticket, boarding pass, and flight status updates are sent through Facebook Messenger. This way, the user has all the pertinent information about his/her trip using an app s/he is already using, eliminating the need to download anything else. Augmented Reality (AR) and Virtual Reality (VR) – Augmented reality is similar to virtual reality but involves enhancing the version of the real physical world through the use of digital visual elements, sound, or other sensory stimuli delivered via technology (Hayes, 2020). While virtual reality, from the word “virtual,” means near, and “reality” is what human beings experience. Hence, virtual reality means near-reality, and it usually refers to a specific type of reality emulation. More and more companies use it to show users a cabin on a cruise ship or transport them to tourist destinations in a matter of minutes. Today, it is possible to “teleport” people to the most remote corners of the globe without leaving their houses. Beeyonder (a marketplace platform that connects guests with live and interactive virtual travel experiences and tours by fun and qualified guides), for instance, brings people on virtual adventures around the world, exploring nearly 50 countries, plus Antarctica (Poitevien, 2021). Internet of Things (IoT) – IoT refers to anything connected to the Internet. These include integrating sensors connected to the Internet inside items like suitcases, cars, and buildings. Spain’s Hotel Technology Institute (Instituto Tecnológico Hotelero, or ITH) affirmed that IoT “is going to be the major 09 Handout 1 *Property of STI  [email protected] Page 3 of 5  TH2107 transformative factor in the personalization of the customer experience over the next few years.” Some Virgin Hotel properties, for example, offer an app to their clients that lets them interact with the room’s thermostat, control the lights in the room, and allow them to check into their room. Virtual Assistants - International Business Machines (IBM, a global technology company that provides hardware, software, cloud-based services, and cognitive computing) launched Watson Assistant. This AI-powered virtual assistant creates an interactive and personalized experience for consumers. This is the open technology firms can employ to provide immediate response and perform administrative tasks for their consumers online. Big Data – It refers to the large, diverse sets of information that grow at ever-increasing rates (Segal, 2021). Marriott gets many competitive advantages from the use of big data analytics. The company uses data to track competitor brands and hotels, identify new revenue streams outside of rooms, such as new facilities and services, and satisfy guests and people in the local community. Blockchain – It is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network. The primary application of blockchain in tourism is to enable secure and traceable payments. The first step in international travel is booking flight tickets. This process is relatively easy in today's age. However, the process can be simplified even further using blockchain-based methods. Winding Tree is an open-source distribution ecosystem that facilitates booking flight and hotel tickets (Joshi, 2019). 5G Network – Travel technology becomes more powerful with the help of the 5G network. It has faster loading and downloading speeds, wider coverage, and more stable connections. Beyond downloading content 20 times faster than before, 5G allows the development and deployment of technology that 4G is limited to. This means that the connection between smart devices will be more efficient, and travelers can enjoy IoT. Immersive tourism, where technology turns travelers into the experience’s protagonist, will be a reality. Plus, augmented reality (AR) or 360° video will be more ubiquitous and accessible. Role of Technology in the Tourism Industry Technology plays an important role for tourism firms in supporting investment in new communications systems in the knowledge economy. This is epitomized by the use of customer relationship management systems that enable real-time information to be fed to tourism firms. The reliance on technology has meant that tourism firms are susceptible to cyber threats and must spend money continuously improving their online systems. Tourism firms differ in ownership structure, history, and culture, which affect their propensity to be innovative. Regardless of the differences in terms of size and conditions, all tourism firms are affected in one way or another by innovation. In addition, global economic crises and the increased interest in sustainability have changed the way tourism firms operate in the environment. Changes in technology are continuously evolving in terms of food, transport, and infrastructure. There has been a rise in tourism businesses using digital platforms. There will be more connectivity amongst tourists and service providers in the future. This is evident in the internet of things with multiple technology devices being connected. More people are using voice recognition and other computer programs to translate languages to enable better information sharing. In addition, interesting new technologies are emerging concerning virtual reality. Some predict that virtual reality programs will be used instead of actual tourist experiences in the future. Thus, much of the future technology changes in tourism are still uncertain. The speed of change in technology regarding its usage in the hotel industry is hard to keep up with. While technological innovation has resulted in increased efficiencies, it has the disadvantages of being costly and time-consuming to implement. This complexity means that despite the technology being needed, it is hard to manage. New destinations previously not considered as one are emerging in the tourism market (Ratten et al., 2020). 09 Handout 1 *Property of STI  [email protected] Page 4 of 5  TH2107 References: Alonso-Almeida, M., Rocafort, A., & Borrajo, F. (2016). Shedding light on eco innovation in tourism: A critical analysis. Sustainability, 8, 1–12. https://doi.org/10.3390/su8121262 Beeyonder. (n.d.). Our mission. Beeyonder. https://beeyonder.com/our-mission Dallemand, J. (n.d.). Why is Marriott the big data analytics leader in hospitality? [Case]. Datumize. Retrieved December 2, 2021, from https://blog.datumize.com/big-data-analytics-in-hospitality-marriott-international-case-study Dictionary.com. (n.d.). Technology. In Dictionary.com. Retrieved December 2, 2021, from https://www.dictionary.com/browse/technology Fayos-Sola, E., & Cooper, C. (2019). The future of tourism: Innovation and sustainability. Springer International Publishing AG. Hayes, A. (2020, December 2). Augmented reality. In Investopedia. Retrieved December 2, 2021, from https://www.investopedia.com/terms/a/augmented-reality.asp Joshi, N. (2019, August 21). How blockchain can transform tourism. Allerin. Retrieved December 2, 2021, from https://www.allerin.com/blog/how-blockchain-can-transform-tourism Pintassilgo P. (2016) Green tourism. In: Jafari J., Xiao H. (eds) Encyclopedia of Tourism. Springer, Cham. https://doi.org/10.1007/978-3-319-01384-8_264 Poitevien, J. (2021, May 23). Take a glow-in-the-dark tour of an Australian forest, enjoy teatime in japan, and more with this new virtual travel company. Travel + Leisure. Retrieved December 2, 2021, from https://www.travelandleisure.com/trip-ideas/beeyonder-virtual-travel-experiences Ratten, V., Braga, V., Alvarez-Garcia, & Del Rio-Rama, M. D. (2019). Tourism innovation: Technology, sustainability and creativity. Routledge. Segal, T. (2021, January 1). Big data. In Investopedia. Retrieved December 2, 2021, from https://www.investopedia.com/terms/b/big-data.asp Vidal, B. (2019, December 5). The new technology and travel revolution. We Are Marketing. Retrieved December 2, 2021, from https://www.wearemarketing.com/blog/tourism-and-technology-how-tech-is-revolutionizing- travel.html Vinod. (2017, February 17) What is IBM?. Techmonitor. https://techmonitor.ai/what-is/what-is-ibm-4950406 What is virtual reality?. (2017, June 30). Virtual Reality Society. https://www.vrs.org.uk/virtual-reality/what-is-virtual- reality.html 09 Handout 1 *Property of STI  [email protected] Page 5 of 5