Racing toward tomorrow’s travel experience

At one point in the
not-so-distant past, travel agents were the primary travel architects, creating
itineraries, making reservations and mailing paper boarding passes to clients.
And then the internet opened up access to the world and reshaped the
fundamentals of travel – how we book, certainly, but also when we travel, where
we stay, and how we get rewarded for all of it.

As the post-pandemic flush of
travel continues unabated – according to the Mastercard Economics Institute, nine out of the last 19 record spending days in both cruise and airlines have happened in 2024 –
travel and tourism providers are now
embracing digital innovation to turn the travel experience of the future into a
reality.  

Just as the internet did in
the early aughts, personalization, dynamic loyalty, artificial intelligence and other emerging
technology are changing the way we travel, enabling a more seamless and custom
experience from booking to wheels up and back.

The north star

So what does a fully
optimized travel experience look like? At its core, it’s seamless and
connected.

A travel assistant crafts the
perfect itinerary, considering your demonstrated preferences, crowd-sourced
reviews, budget and timing, and links your bookings through your central
loyalty account. The traveler is empowered with the right expertise and supported
at every turn. 

At the airport, you’re
automatically checked in and directed to the right gate, where you’re served
relevant offers you can take advantage of while you wait or at your
destination. And once you arrive, your map can tell you where to go in
real-time based on your pre-loaded itinerary.

While these are just a few
examples of what a digitally enabled travel could look like, the goals are the
same: a faster, elevated experience, a better connected and more knowledgeable
consumer and more precise travel providers. 

Loyalty and personalization reimagined

Mass personalization may
sound like an oxymoron, but it’s the linchpin to providing an elevated
experience for travelers. While tailored engagement has crept into the travel
space, a fully optimized travel experience goes beyond a timely suggestion on
the booking website. And when responsibly and transparently collected and
managed, data from loyalty programs can help power these tactics to ensure
relevant and convenient recommendations that improve the experience.

Micro-redemptions, fast-track
lanes, free luggage storage and more all represent economies of convenience,
where providers deliver value through simple, useful perks. For example, if you
travel occasionally and are a member of an airline loyalty program, you likely
have enough points in your account to feel a sense of accomplishment, but not
enough to redeem any kind of significant reward (like a free upgrade or
flight).

But with a 360-degree view of
its customers, the airline can evaluate your preferences and adjust what
redemption options they promote to you. Rather than have you sit on a couple
thousand points that will never return a meaningful reward, the airline can
recognize that you typically buy in-flight Wi-Fi and instead allow you to
redeem points for in-flight internet access – a relevant perk offered at the
moment it can be used is a minor revenue concession for long-term loyalty.
Micro-redemptions like this are only possible with the right architecture, rich
data and a deep understanding of the consumer’s needs and wants.

Executing a dynamic program
like this requires specific infrastructure on the back end, where data is
connected across sources and there’s an organizational imperative to retain a
share of loyalty consumers. And the appropriate real-time communications
channels that enable well-timed dialogue are the perfect complement. This more
elastic, customized approach to engagement can help providers be more proactive
and less reactive while they build loyal relationships with their customers.

Make way for AI

While AI is crucial to
realizing personalization at scale from a purely technical perspective, it’s
also starting to make inroads on the front end. Generative AI has vast
potential to alter the travel landscape, and the biggest opportunities are
around AI-assisted travel planning and AI-enabled benefits maximization. These
two areas are key to solving classic travel pain points around planning and
booking trips. A virtual travel agent, for example, can provide dynamic
responses to direct questions — curating itineraries, booking activities and
automating payments — before connecting you with your card’s concierge
services; or a tool that helps you figure out how best to maximize your loyalty
points and activate card-linked offers. Generative AI can be the means to a
more efficient and valuable end. 

The potential of generative
AI is great, but the devil is in the details – or, more exactly, the execution.
AI “hallucinations,” where a generative AI tool delivers inaccurate or absurd
information, are a huge risk to a company’s credibility and a consumer’s
satisfaction, especially when it comes to travel. Companies must take care to
ensure their models are properly trained and continuously tested to safeguard
the consumer while minimizing bias and risk.

People are traveling more
than ever – not just for vacation, but for memorable events, from concerts to
solar eclipses – and they’re looking for value, convenience and flexibility
above all. Meeting today’s traveler where they are will require the industry to
consider not just where they’re going, but what they’ll need to guarantee a
smooth journey from start to finish. With a pulse on consumer behavior and a
willingness to experiment with different approaches and technologies, the work
of traveling can soon be as gratifying as taking the scenic route.