Travel

More than one-third of leisure travelers have used GenAI tools, report says

More than one-third of leisure travelers have used GenAI tools, report says


Travelers are finding generative artificial intelligence to be useful in their planning processes, according to new research from Oliver Wyman published Friday.

The management consulting firm surveyed more than 1,000 travelers in the United States and Canada in August to learn more about the consumer attitude toward generative AI. The results were enlightening and “exciting,” said Scot Hornick, partner and head of pricing, sales and marketing for the Americas for Oliver Wyman.

“It was surprising how many people have already been using generative AI considering these tools were just introduced earlier this year,” Hornick said. “We didn’t expect to find so many.”

The report, which looked at chatbots including Google’s Bard, Booking.com’s AI Trip Planner, Expedia’s ChatGPT integration and Priceline’s Penny, among others, found that more than 1 in 3 leisure travelers have recently used tools powered by generative AI.

The adoption rate was quite high for technology that had been on the market for only about six months when the research was conducted, said Lawrence Burka, principal for Oliver Wyman in transportation and services and pricing, sales and marketing practices.

“But not only was the adoption high, the satisfaction rate was high,” Burka said, noting that the amount of travelers who booked based on AI-generated recommendations was also high.

Travelers who use GenAI find it helpful 

While it’s significant in itself that travelers are using the AI tools that hit the market so recently, it’s perhaps even more impressive that many are finding the technology helpful.

Of the travelers who used one of these chat tools, Oliver Wyman found 84% were satisfied and more than half took most or all of the recommendations provided by the AI.

And it goes beyond just trying the technology. The research found that 54% of leisure travelers already trust generative AI for travel inspiration and planning purposes and 81% of them said they would book based on its recommendations.

There are some features that Oliver Wyman found were more important to travelers, including comparative pricing, the ability to book all trip aspects in a single place and the ability to integrate loyalty programs.

Travel suppliers should consider how to incorporate GenAI

Oliver Wyman’s data also looked at loyalty travelers and found 63% of elite travel loyalty members and 50% of non-elite members would, in the future, choose a booking platform because of its generative AI capabilities. 

With that in mind, Hornick said travel suppliers should be considering the incorporation of this technology. 

“If you’re trying to figure out how to drive more direct bookings, and you’re counting on your loyalty, elite members or loyalty program members to be your most likely and sticky group that’s going to use your channels to book, you better think about whether or not you need to equip those channels with these kinds of generative AI capabilities,” Hornick said.

He cautioned: “If those customers find that they’re getting more value from non-direct channels that actually help them plan a vacation or inspire even where they want to go, then that’s a possible loss of direct booking volume.”

GenAI is already a focus for travel brands

Generative AI and large language models have been a constant topic of discussion for the travel industry for months. And Oliver Wyman’s research comes on the heels of OpenAI’s first developer conference on Monday, which brought together developers from across the globe to preview the ChatGPT creator’s upcoming tools.

Quote

I think generative AI will become almost a de facto standard for how [some travelers] think about their travel plans and how they even dream about their vacations.

Scot Hornick — Oliver Wyman

And, according to experts, the level of excitement around AI and its advancements is only growing – part of that is due to how search has changed as a result of AI.

There’s a big shift happening, Pablo Laucirica, regional vice president of advertising for Microsoft, said during a PhocusWire Let’s Hear It! LinkedIn audio event

“If you think about a year ago, the traditional search experience is you were typing a query and you were getting tons of links,” Laucirica said. “Now we are shifting from searching to finding.”

Tripadvisor vice president and head of data Rahul Todkar said, “this is a pretty big moment.”

Top travel brand CEOs have been open about their experimentation with generative AI. So far, the results seem promising. 

Tuesday in its third quarter earnings call, Tripadvisor CEO Matt Goldberg said its members who are using the AI-powered trip planning tool “generate on average three times higher revenue than the average Tripadvisor member.”

And during Expedia Group’s third quarter earnings call last week, CEO Peter Kern said the company recently started promoting its ChatGPT tool, which has been incorporated into the Expedia app and on its website since April. Kern said Expedia is seeing “much more engagement” with the tool – though he added it’s too early to notice a major impact.

Likewise, Glenn Fogel, CEO of Booking Holdings, said during its earnings call last week the company is focused on integrating generative AI into its business strategy. Hotel brands including Marriott, Wyndham and IHG are looking at how to incorporate the tech too.

GenAI could be the future of leisure travel planning

Not everyone will rely on generative AI for travel planning, Hornick said, pointing to someone booking there-and-back trips for work, for example.

But per Hornick’s estimation, this technology could be at the root of travel planning for many in the future.

“I think generative AI will become almost a de facto standard for how [some travelers] think about their travel plans and how they even dream about their vacations,” he said. “I can imagine the family getting around the laptop or getting around somebody’s iPad and looking at the recommendations that come out of generative AI and using that as their guide.”

Hornick said it’s “inevitable” that GenAI will become an important piece for “all of the major booking channels.”



Source link

Shares:

Leave a Reply

Your email address will not be published. Required fields are marked *