Blockchain Will Reshape The Travel Industry: An Introduction
2017 was one of the strongest years of GDP growth in a decade: the global tourism industry contributed $8.3 trillion to the global economy (WTTC, 2018).
This was 10.4% of the world’s GDP and supported 313 million jobs (1 in 10 jobs). In 2018, tourism GDP is expected to grow by 4% and by 2028, generate 11.4% of the world’s GDP and accounts for 1 in 9 jobs globally.
But There Are Problems…
In the connected world, online booking has become so trendy that more online travel agencies have emerged. Agencies have to spend lots of money to rank above the competition on various search engines and social media, hence driving up customer acquisition costs. The challenge is to deliver the best deals while keeping customer-acquisition cost to the minimum.
Most travel agencies only accept payments in fiat, exposing the customer to problems including costly foreign exchange rates, transaction delays, and double bookings.
Travelers are wasting too much time navigating multiple websites and platforms to make bookings, downloading new apps for each trip and ultimately deleting them upon departure. Once again, travel agencies have to spend to attract customers for their subsequent trips.
Here’s Where Blockchain Comes Into The Picture
Often referred to as “the Internet of money” or even “the Internet itself”, blockchain is set to decentralize and disrupt tourism.
✓ Allow travelers to choose from a pool of services, those that best suit their traveling needs, plan their trip and their spending accordingly, hence saving up on their booking, and
✓ Increase income for hoteliers and travel service providers as they do not have to pay listing fees for booking services.
So it’s a win-win solution!
Furthermore, not only will blockchain revolutionise the online travel bookings & payments ecosystem, but it will also offer a Peer-to-Peer (P2P) marketplace for travellers to buy and sell their own tickets related to travel (ie. events, tourism, etc).
Currently, if consumers purchase tickets to an event, for example a concert, and then wish to cancel due to whatever reasons, they will struggle to recoup their losses.
Blockchain will solve that problem. Consumers can have their purchases refunded, and even become a ticket reseller on the blockchain platform.
Being a decentralised platform, consumers rely on no third party intermediaries, producing low fees, instantaneous transactions, and anonymity for security and privacy!
Travel Planning Isn’t That Boring Anymore
The blockchain community can be seen as a social media and travel agency hybrid. Both travelers and locals can supply additional information to help support purchase decisions and trip planning, such as top video content created by influencers and reviews about the service from other websites. That adds a personal touch to travel planning.
They can then be rewarded in tokens, which can be redeemed for services on the platform and other travel-related giveaways, incentivising more meaningful information exchange. Instead of users only visiting only to book services (non-frequent purchase), they can take an active role to support each other on the platform and earn tokens.
This in turn helps customers to decide which travel provider to engage without having to leave the platform for more research.
Blockchain + Tourism = Bright Future Ahead
Blockchain has paved the road for a new version of the Internet and doing business. So many different models are emerging in different fields and are becoming increasingly popular.
In the coming years, many business models will change thanks to blockchain, especially for the travel and tourism industry. We can expect a diversification of travel agencies. Individuals can provide services acting as a small agency.
These kind of shifts from the current models will cultivate different, not yet imagined, changes throughout the world.
Travel is an ever-growing, $8.3 trillion dollar industry — so act now! Get the first-mover advantage and launch a blockchain tourism platform.
Prepare for takeoff!
World Travel & Tourism Council, 2018. [online] Available from: https://www.wttc.org/about/media-centre/press-releases/press-releases/2018/one-in-five-of-all-new-jobs-created-globally-in-2017-are-attributable-to-travel-and-tourism/ [Accessed 19 Oct 2018].
Judy Shapiro, 2017. [online] Why Blockchain Will Save the Agency Business. Available from: https://adage.com/article/digitalnext/blockchain-save-agency-business/311614/ [Accessed 22 Oct 2018].
Blockheads.co, 2017. [online] 5 Ways Blockchain Will Disrupt the Travel Industry. Available from: https://medium.com/swlh/5-ways-blockchain-will-disrupt-the-travel-industry-5792c9ecfb4e [Accessed 22 Oct 2018]