Digital transformation has a profound impact, entirely changing the way people live, work, travel and do business, and in the process, they are transforming and reshaping tourism. The scope and uptake of digital technologies varies across countries, sectors, organizations and places. The resulting opportunities and barriers create an uneven playing field, which is exacerbated by a growing gap between tech-driven and globally connected tourism businesses. Digitization in tourism presents opportunities for SMEs to expand their market reach, increase growth, improve operational efficiencies, and sharpen their competitive edge. However, SMEs are lagging behind in the digital transition (OECD 2019), and many small traditional tourism businesses are struggling to understand the opportunities and reap the benefits. Digital transformation is thus pushing tourism in new and often unpredictable. Destinations, businesses and the wider tourism sector will need to fully embrace these new technologies to remain competitive, and to take advantage of the innovation, productivity and value creation potential. Policy makers have an important role to play to help tourism businesses of all sizes, including the more traditional and smallest firms to engage with the digital revolution, and thrive in response to the paradigm-shifting technologies. Therefore, this essay will summarize the ideas that were shared by #sttachangemakers during a tweet chat on Digitization in Tourism.
Digitization opportunities for Tourism businesses in Africa.
Digitization offers many opportunities that can be exploited by providers in the tourism industry. At the same time competition is being intensified and companies have to keep pace with digitization in order to remain on the same level. Without any question, digitization can be viewed as the motor of transformation for the tourism industry in the age of internet economy. Some of the opportunities brought up by digitization in tourism pointed out by the #sttachangemakers include;
First, the shift to a digital economy offers opportunities for tourism enterprises of all sizes including access to new markets and bringing new tourism services to consumers globally and improving competitiveness, performance and productivity. For SMEs in particular, it can improve access to market intelligence, enable businesses to achieve scale without mass, facilitate access to global markets and knowledge networks at relatively low cost.
The fundamental value of the travel industry refers to create a connection between people and location. The born of sharing economy has made online booking even cheaper. Travelers currently benefit from the diversity in accommodation booking worldwide with more customize options. Take Airbnb as an example, allowing hosts to share their spare room with travelers, it turns every house becoming a temporary hotel. One of the most significant outcomes of the digital transformation process refers to offer more affordable services in the convenience and accessible approach.
Digitization in tourism brings significant potential benefits to SMEs, it can help them to become more efficient, free up time and resources to focus on strategic tasks, and increase their capacity to develop new business models, enter new markets or internationalize operations.
Another major opportunity from digitization in tourism is that it can act as a shock absorber during off peak seasons by increasing virtual tours. Research shows that people nowadays are looking for easier ways to engage. In order to achieve that, the world is currently focusing on using VR which a person can experience a location remotely. This means that through a virtual tour, one will be able to visit a place virtually and experience the surrounding even without being there.
Digitization and tourism businesses in Africa.
Technology advances have changed the way we travel, and these new developments promise an even more interactive and exciting experiences. Digitization has left no segment of the travel ecosystem untouched. In today’s digital age where bookings are confirmed in a split of second and an entire trip can be planned with a few taps of the finger, it’s hard to imagine life back in the “golden age of travel” where if you wanted to book a flight it would take ninety minutes to manually process the reservation, and the ticket would have cost more than today in real terms. Thanks to technology, travelling today is more affordable, accessible and convenient than ever before.
The days of stepping into a brick- and- mortar travel agency or thumbing through travel guidebooks are dwindling fast. Mobile travel sales have seen phenomenal growth, a huge number of travelers today use smartphones to plan and book trips. Consequently. This means that people are increasingly interested in booking hotel rooms, buying tickets, tours and other products via their phones.
Another big advantage of digitalization is the ability to harvest data and analytics. Consumers want to feel special and expect personalization of services and experience. By capturing personal data from consumers and learning more about their behavioral patterns, travel companies and flights are increasingly optimizing services across the customer journey.
Digitization has redefined destination marketing strategy. Digital disruptors like social media, mobile devices and accessible information enable destination marketers to engage with consumers and stakeholders on a larger scale than ever before. Mobile platforms and communication allow DMOs to engage with a visitor through all stages of their experience, from awareness to interests to booking to visiting to post-visit.
Millennials have also played a significant role in this paradigm-shift. They love to travel and are also passionate about new technology. This combined interested has given way to a new context where social media, blogs and apps have an important role to play. By that same token, the industry as it becomes increasingly aware of this trend, has followed suit by adapting its business model and product offering to attract this coveted target.
Pandemic has made its advancements but it has also opened up new opportunities for the technology to evolve and create safer experiences for tourists, travel hubs and for the people who work in the industry. High end tech such as robots, computer vision and voice recognition made it possible to add automation and eliminate humans from many routine operations e.g., payment methods, security check, hotel check-in and cleaning. These technologies have helped reduce not only risks associated with the spread of the virus but also decrease human errors and accidents.
Automation and robotics are a key trend in tourism with applications developed for physical tourism businesses as well as online. For instance, many tasks that were once handled by humans (tourism business operators) now being taken by robots or automated systems such as chat box. These have fallen into widespread use across the industry and are designed to help travelers find and book tours, transport and accommodation by asking a set of questions.
Technology therefore pervades every area of tourism and must be given the highest priority when developing the workforce of tourism (United Nations World Travel Organization).
Shortcomings arising from digitization in tourism.
Tourism and travel are highly dependent on technology and its use has made life a whole lot easier. On the other hand, technology’s growth has allowed worldwide terrorism to attack tourism and travel industry. Cell phones can save lives or detonate bombs, air conditioning units serve to make life bearable in hot climates, but also pollutes the atmosphere and can be carriers of diseases. The dawn of computer age permits us to know weather forecasts around the world, allows business travelers to stay in touch with their offices and to supersede the problem of cross time zones negotiations, but can also be used to destroy air travel.
Technology then has become a mixed bag for the tourism industry. It creates a lot of conveniences while at the same time has been used as a way to increase revenues and lessen customer service. The world of technology has made travelling safe and abundant but has also brought about the need to go through long security lines and daily hassles.
Also remember that tourism is about people “interfacing” with other people. No matter how good technology may be, technology does not provide the human warmth of take-home experiences. Tourism is about selling of memories.
Technology is also only good as the people who use it. Often tourism centers hire people who simply are not up to the task, misuse the technology and create more problems than the solve. Therefore, training of the employees is needed, tourism centers do not update so often that the employee’s knowledge base lags behind the technology.
Lack of access to finance, information, knowledge networks, skills and time can be barriers to digital transformation. Tourism SMEs may lack capital reserves, have difficulty qualifying for loans and credits, or perceive the investment too risky. Thus limits the willingness of SMEs to invest in digital technologies. In response to this, the government and stakeholders should offer trainings for tourism professionals to improve digital skills at beginner and expert levels. This is a good way to encourage upskilling while taking into account the limited time and resources.
While digitization in tourism comes with shortcomings, digital technologies have important implications for tourism businesses of all sizes, for the structure and operation of tourism value chains and for the sector as a whole. Therefore, facilitating and enabling digitization in tourism is a key policy.
Keys for optimizing digitization for tourism successes in Africa.
Despite the uneven uptake of digital technologies, the digital transformation has, and will continue to have a profound impact on tourism. It is changing the way work is organized and services delivered, and also presents opportunities to take advantage of digital advancements to handle transactions, improve and connect operations along tourism value chains and ecosystems. Similarly, the travel and tourism industry is also ‘information intensive’ which means most of the tourism services are ripe for technology. Here are a few keys to optimizing digitization for tourism success in Africa:
First, innovative rethinking of processes with an aim of tackling rampant challenges like seasonality, overcrowding, and ultimately development of ‘smarter’ destinations should guide the optimization of digitalization of tourism.
Secondly, automation is key to achieving tourism success in Africa. Automated travel systems facilitate the management of the ordering process, inventory, role assignment, and the creation of rooming, transfer, bus, and flights lists. It helps organize traveler departures and arrivals, improves efficiency and reduce costs. Immediacy and urgency in sales are critical to a tourism business’ survival. A complete system for travel agencies and tour operators can automate and speed up many actions e.g., reservation management and booking of travel products.
In order to increase the competitiveness of tourism enterprise and the convenience of the travelers, it is advisable for travel businesses to create their own mobile applications. The current generation of people are actively using wearable mobile devices and it is more convenient to customers to immediately go into the application and see the list of tourist products offered by the travel company.
The digital business transformation involves effort, resources and money and the cost is often too high to be implemented across the organization. Therefore, cheap access to internet is also a key for optimizing digitization for tourism success in Africa.
Digitalization is changing the way companies interact with customers. This process allows companies to receive information about their customers and develop offers that are ideal for a particular tourist in terms of quality, price, service and delivery method. In these conditions, tourism industry enterprises must invest in personnel, thereby providing opportunities for digitization of business processes. The digital transformation is also forecast to generate benefits valued for customers and wider society, through reduced environmental footprint, improved safety and security and cost and time savings for consumers thus digitization is key to tourism in Africa as a destination. However, it can still replace quality service, great experiences and world class products.
By Sheila Omondi and Jamie Sanzi.