How tech and travel are influencing the experience economy

2018-05-08 09:30 - Ethan Van Diemen
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a phone with AR display helping a traveller get ar

A traveller uses augmented reality to find useful locations nearby (Photo: iStock)

The technological disruption and transformation has affected nearly every sphere of modern human activity, allowing us to do, see and experience more than ever before.

Travel and tourism have not been immune to these affectations and travel companies are harnessing innovative technologies to provide simpler, faster and more personalised travel services to a new generation of tech-savvy consumers who increasingly value experience - and creating memories - more than tangible material goods.

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First used in 1998 by B Joseph Pine II and James H Gilmore in the Harvard Business Review, this specific area of economic activity came to be known as the ‘experience economy’.

In the Review, Pine explains that it is useful to think of ‘experiences’ and ‘services’ as distinct products when referring to the ‘experience economy’. Where goods are tangible and services are intangible - experiences are memorable.

Subsequently, two key dimensions through which to identify an experience are ‘participation’ and ‘connection’.

Participation and connection are not only the end result; but a part of the process that allows travellers in the 21st century to experience more with technology and travel.

Human society is currently in the early stage of the technological revolution wherein everything from machine learning, artificial intelligence, augmented and virtual reality will come together to create more personalised experiences.

Whether you preview your hotel room in virtual reality, identify and find information on notable sights with augmented reality or just finding the best flight by chatting to a speaker - the only real limit is how we make use of the tech.

SEE:#TravelTrends: Chatbots changing the consumer travel experience

As the most eager adopters of technology products, Millennials and Gen Z's - defined as those born from the 1980’s to late 1990’s and those born mid-to-late 1990’s and 2000’s respectively, recognise travel as a major area in the experience economy being forced to quickly adapt to rapid change.

These groups are increasingly exerting influence and imposing their desires on the global economy writ large and tourism is not immune to this trend. With the travel and tourism industry being valued at $1.6 trillion in 2017 (approximately R20,32 trillion at $1/R12.70 on 2 May 2018), millennials and Gen Z’s will come to represent an increasingly influential segment of the global travel market according to Chris Wallis, commercial director at Expedia Affiliate Network.

According to Chris Wallis, Regional Director, Central & Eastern Europe, Middle East & Africa for Expedia Affiliate Network, millennials spend more on experiences and less on investments and tangible, material goods such as vehicles. Up to 64% of millennials are saving, and spending, their money for the purpose of creating and having [travel] experiences.

SEE:#TravelTrends: 6 technology trends in the travel and tourism industry in 2018

With more than 20 million internet users in South Africa, the number of persons being influenced by, and planning their travel experiences through digital technologies is changing in-line with global trends.

Speaking at the World Travel Market Africa 2018, Wallis put forth his, and the Expedia Affiliate Network’s, beliefs in which specific technologies are most likely to influence travel and the experience economy moving forward:

  • Virtual Reality (VR) is another increasingly popular way to research destinations and discover holidays before departure. Chris Wallis says that roughly 50% of internet-connected Millennials already make use of VR for this exact purpose.

  • Google Earth is one popular way this technology has been used to a great extent. This technology allows users to connect with distant locations and research their experience beforehand allowing for a seamless travel experience. 

  • Augmented Reality (AR) will continue to be used to improve the way we access, and process, information about our surroundings and this will have a great impact on the experience economy.

  • It is already being used to help people get around, decide what to eat and help people understand their surroundings in real time. Popular mobile crowd-sourced review app Yelp was an early adopter of AR technology with Yelp Monocle.

  • Yelp monocle uses your cellphone camera, which you point toward buildings, to identify which businesses your friends have check into among other useful bits of information.   

These technologies are but glimpses into the possibilities that will emerge as technology continues to create new, innovative ways that connect people to locations and create the conditions for memorable travel experiences. With increases in modern computational power, the only limits ,with regards to where the technology takes us, are the limits of our imagination. 

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