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How Smart Tourism Experiences Are Served by Technology

Personalized, automated experiences are the future of luxury travel – but the key is to design the experience first, and the technology that enables that experience second.

Smart destinations:

Are led by the experience that’s enhanced by technology

Embrace automated bespoke hospitality

Are built from the ground-up so that they’re truly different from other luxury travel products

Imagine a vacation where you wouldn’t have to leave behind any digital conveniences like connected devices and high-speed Internet access. Or that every aspect of your trip had a positive environmental impact. And what if you could get back all the time you spent researching, planning and booking because the activities you’re interested in are already lined up for you?

This vacation scenario only scratches the surface of what’s possible when automation and luxury experiences come together to create a new tourism product the world hasn’t yet seen. With the rise of smart cities, which in some cases have enabled smart tourism experiences, technology has been integrated into new infrastructure – and then government officials and businesses determined what experiences those technologies could create for residents and visitors.

But with tourism, the reverse should happen, where the customer experience is first reimagined and then local stakeholders build out the technology in the background to enable it.

Being a smart destination means offering an automated bespoke experience that’s completely unique, luxurious, personalized and memorable and powered by AI and data in the background. Smart or connected experiences are luxury experiences, and that’s what high income travelers are seeking.

The pandemic created a huge savings glut, with excess savings in the U.S. worth about 12 percent of GDP while that number is 10 percent in the UK, according to Moody’s. Much of that savings will be spent on luxury experiences in the coming years as more people gain disposable income. The global luxury travel market is expected to hit nearly $1.2 trillion by 2027, growing at a compound annual growth rate of about 11 percent between 2021 and 2027, according to a 2021 report from Allied Market Research. Capturing a fraction of that market would be a success for any destination, but doing so won’t be easy as these travelers have high expectations for their trips.

Three most desirable luxury amenities for post-pandemic travel:

According to a 2021 American Express Travel survey of Australia, Canada, India, Japan, Mexico, UK and U.S. travelers, the three most desirable luxury amenities for post-pandemic travel are personalized experiences (82 percent), high cleanliness standards (81 percent) and privacy (79 percent). Automated bespoke fuels those amenities and more. The goal is that travelers become so immersed in the destination that they continue to add on experiences and activities because each one exceeds their expectations. Think of a safari one day, a behind-the-scenes visit to a cultural site the next and then a local culinary experience the day after. And the technology enabling that transaction experience is operating seamlessly in the background, letting staff focus their time and energy on using customer data to provide these travelers with exceptional service.

The idea that travelers want to disconnect while they’re on vacation isn’t actually accurate: more than half of respondents to a 2019 BankMyCell report of U.S. travelers said they check their phones one to five times per hour on vacation. It will take a lot of customer data to make automated bespoke a reality, assuming destinations can overcome and accommodate privacy considerations. Much of that data will come from devices like phones, wearables or tablets that travelers bring with them. The average U.S. consumer owns 10 connected devices, according to Statista, and they likely travel with a handful of those. Destinations can use data from those devices in real-time to improve the customer experience.

Automated bespoke helps to create an intimate experience that optimizes visitor capacity and minimizes things like energy usage and waste. Luxury travelers want connectivity married to sustainability -- some 68 percent of respondents to the American Express Travel survey said they are trying to be more aware of sustainable travel brands to support. But how can destinations do this? Smart destinations must be truly designed around people to serve both desires, and automated bespoke helps to plan and execute traveler journeys so that the environmental impact is both minimal and positive.

While existing cities and destinations like Barcelona or Venice can take steps to integrate digital into infrastructure, new destinations built from the ground up have the advantage of baking in digital from the beginning and ensuring the products they offer are sustainably built and operated.

First and Foremost: Get the Experience Right

Tourism academic Haley Stainton argues there are five key methods to implementing a smart tourism experience: smart accessibility options, smart sustainability initiatives, smart information sharing, smart research and management tools and smart tourist experiences like augmented and virtual reality.

Few destinations have any or all of these building blocks, leaving opportunities to deliver great experiences on the table. Increasingly, luxury travelers don’t want a typical island experience where they only sit on a beach all day. Social media and customer reviews have demonstrated how people experience destinations and how they make information on what to see and do more accessible, often appearing right in social media feeds. They want variety of activities, both land and sea-based. Adventure and safari and culinary travel and shopping are the most popular types of luxury trips and will remain so through at least 2027, the Allied Market Research report found.

Traditional luxury-focused destinations like the Maldives essentially offer the same experience day after day with a focus on water and beach-related activities. The Middle East is also known for its luxury products, like Dubai’s Al Maha resort which is geared towards bespoke experiences. But many destinations throughout the region offer cookie cutter experiences that are too pricey for their low level of personalization, and technology isn’t being used to automate things that improve the experience like bag transport or booking activities.

New destinations like Saudi Arabia’s Red Sea Project are taking all the different luxury products and experiences the Middle East offers and bringing them to one location while creating bespoke experiences elevated by digital. Sustainability will be the hallmark of the destination, with 100 percent of its energy coming from solar and wind, and 75 percent of buildings being LEED certified. The destination will be run by a smart destination management system that supports a range of personalized services and manages visitor flow to prevent overcrowding and delays.

The Red Sea carefully considers what the traveler experience should look and feel like, and then identifies technologies that bring that experience to life. Using an automated bespoke approach could also enhance sustainability efforts by making operations like housekeeping more sustainable and anticipate what travelers want, when they want it.

One&Only Resorts is a great comparison of the luxury and personalization that Red Sea will offer and the kind of land and sea experiences that will be available. In contrast, however, Red Sea will use digital to inform what kinds of experiences are offered and who they’re offered to while connecting travelers to a one-stop shop, Amazon-like marketplace to have a single transaction scenario that luxury customers are accustomed to.

Smart Tourism is Already Here

Elements of smart tourism already exist in popular destinations like Malaga, where a new parking app shows travelers where to park to reduce congestion, and in New York City, where LinkNYC kiosks offer free Wi-Fi and display neighborhood-level event and mass transit information.

But those examples are isolated from the destinations’ broader infrastructure and don’t help to connect or automate every aspect of a traveler’s journey. The human experience in these destinations wasn’t considered from the beginning, and travelers can tell when this is the case.

Remember that the idea of smart cities and destinations isn’t new. Starting with destinations like Epcot 60 years ago, technology has always been the priority and less thought has been given to how people would actually experience these places. The right pieces weren’t connected. Projects like the Red Sea have the opportunity to set a new standard for what luxury travel experiences can be like and how to put people first.

Jagdish Ghanshani
Jagdish Ghanshani
Managing Partner, Global Client Partner, Travel & Hospitality

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