Travel and Hospitality Industry Welcomes New Challenges in 2023

Americans are ready to say hasta la vista to 2022 and everything that came with it—inflation, rising crime, and the lingering effects of the pandemic. And after staying close to home for the past few years, Americans want to get away from it all—get far away from it all.

According to a study by MMGY Travel Intelligence, high-earning Americans plan on taking an average of 3.8 international vacations in the next 12 months—up 72 percent from 2019.

And despite the uncertainty of the state of the world, 73 percent of people surveyed by booking.com are more optimistic about travel than they were in 2022—and half of those surveyed say that investing in a vacation next year is a top priority.

The travel industry may have gotten off to a bumpy start this summer, but there’s every reason to be hopeful heading into the new year.

The rise of online transactions

With Americans willing and eager to go on vacation in 2023, the travel industry needs to prepare for a public forever changed by the pandemic.

During the pandemic lockdowns, American consumers got used to the convenience of shopping on digital channels. In the first three months of the pandemic, ecommerce surged—more than doubling in growth over the previous year, according to research by McKinsey.

And after three years of contactless grocery delivery and shopping for (almost) everything online, it’s no surprise that 65 percent of customers say that they want to spend their money with companies that offer quick and easy online transactions. And 75 percent of customers are willing to spend more of their hard-earned money with companies that give them a good customer experience, according to the Zendesk Customer Experience Trends Report.

In order to compete in this new post-pandemic world, the hospitality industry will need to significantly increase its investment in customer experience (CX) over the next five years. And in return with a deeper focus on the customer experience, the hospitality industry can unlock a deep return-on-investment.

Smooth sailing with omnichannel CX

Unlike retail and grocery stores that adopted an omnichannel approach to customer service during the pandemic, many in the hospitality industry continue to serve its customers over siloed channels.

Without access to previous communications, CX agents have to ask customers to repeat themselves—one of consumers’ biggest complaints. It’s such a big frustration that 93 percent of consumers say they are willing to spend more with companies that don’t ask them to repeat themselves over and over again to CX agents.

When airlines, hotels, and cruise lines take an omnichannel approach, customers don’t have to keep explaining themselves to CX agents. Agents can easily help customers, even when they switch from mobile messaging to email. With an omnichannel platform, agents have the full context of previous conversations, allowing them to continue the conversation seamlessly. And when agents have access to past conversations across multiple channels, they’re better able to quickly find solutions for customers.

Chatbots make for happy high-end travelers

AI-powered chatbots are evolving into anytime assistants that can help hotel guests with a variety of requests—whether it’s an appointment at the spa, room service, or dinner reservations. And conversational messaging has transformed the way the Four Seasons Hotels and Resorts interacts with its guests.

“Over the years, messaging has really taken off,” Marco Trecroce, CIO, Four Seasons Hotels and Resorts, explained. “And this is the one technology investment that I think has resonated with our guests.”

Guests at the Four Season never have to wait on hold when they use the hotel’s chatbot. And even though the conversations are powered by AI, they’re conducted using natural-sounding language.

“That’s what’s lovely about messaging, because it’s actually conversational,” Trecroce said. “And once you move into conversational, it completely changes the dynamic and the interaction that you have with the guest—and that's the key: it’s the connection. Once you have it, they stay very loyal to the brand.”

The Four Seasons’ AI-powered chatbot has resulted in an increase of NPS scores by seven points. The hotel also earns additional revenue by offering amenities and upgrades through the chat. And the bot communicates in the guest’s preferred language—a necessity for an international hotel chain.

“You can travel and leverage the application and technology regardless of country,” said Trecroce.

Digital nomads need CX, too

As companies debate the merits of workers returning to the office now that the pandemic has subsided, the youngest members of the American workforce aren’t exactly thrilled with the idea. So far, the members of Gen Z have shown little enthusiasm for sitting in a cubicle when they could be working poolside.

Millennials also prefer to work remotely—and they represent the largest percentage of the American workforce and hold the most purchasing power. And with more and more companies reaching a compromise with their employees about how and when to return to work, there’s opportunity for hospitality brands to cater to younger workers with flexible schedules.

Both millennials and Gen Z have high standards for customer service—80 percent of millennials make purchase decisions based on the quality of customer service, while 64 percent of Gen Z shoppers demand an instant response when reaching out to customer support.

Hospitality brands that make CX a priority by offering millennials and Gen Z the fast, seamless interactions they desire will gain an edge over competitors in the increasingly crowded marketplace.

ABOUT THE AUTHOR

Teresa Anania leads the management of Zendesk's global client base, developing customer segments from small, local businesses to multinational corporations. She consistently delivers for Zendesk’s clients, producing favorable returns and realizing maximum business value across the customer lifecycle.