Pivoting toward the new frontier in travel & hospitality

The travel and hospitality (T&H) industries have emerged from a perfect storm of disruption. Statistics such as airlines projected to exceed pre-COVID-19 passenger levels this year indicate that many segments are back in full swing. Travel and hospitality firms are poised to reinvent experiences and become competitively stronger than ever — if they follow the right path. The surge in demand and customers’ changing expectations require these firms to simultaneously scale back up quickly, make key customer-facing and organizational changes, and pivot for customer needs. At the same time, there is significant, mounting pressure to do more with less and innovate in tandem.

To better understand the challenges, priorities, and opportunities facing the travel and hospitality industries in 2024 and beyond, we surveyed 315 enterprise leaders across airlines, airports, hotels, and online travel agencies (OTAs); we also interviewed several executives from these industries. We gained valuable insights into how these firms are reorganizing and emerging from the great disruption while preparing for a strong and lucrative future.

Key findings:

- The digital conundrum: Travel and hospitality firms must balance cost with innovation. T&H firms are currently focused on cost containment, but leaders expect to require an even greater focus on innovation soon.
- Invest across enterprise transformation horizons to survive, thrive, and lead. Travel and hospitality firms are investing across three key areas of enterprise transformation and developing ecosystems in the future.
- T&H firms must operationalize to meet customer expectations and battle digital disruption. A shift in customer needs and expectations toward personalization and seamless experiences is driving digital maturity, operating model changes, and rapid product and service innovation developments.
- Enabling tech adoption is driven by core modernization, and emerging tech such as GenAI brings cautious optimism. Core modernization and digitalization are table stakes, and GenAI opportunities and risks loom on the horizon.
- Partnerships must become a significant element of ecosystem development. Travel and hospitality firms are leveraging partnerships for domain expertise and consulting prowess, especially when it comes to important initiatives such as customer experience (CX) and sustainability.