Digital travel: digital tourism is growing exponentially and is now worth over 15 billion. Digital innovation continues to drive the entire travel sector.
Where is digital travel heading in Italy? According to data released by theDigital Innovation in Tourism Observatory of the Politecnico di Milano, 97% of Italian tourists use the Internet for inspiration and research, and 85% use it to book their vacation accommodation, but one in three (33%, especially Millennials) still turn to traditional travel agents and consultants.
83% of agencies report an increase in revenue and digital becomes a competitive factor for the entire supply chain. Almost all agencies (94%) collect customer information in digital format to better understand their behavior.
In accommodation facilities, technological solutions to improve the traveler’s experience before and during their stay are spreading, albeit slowly: 8% have introduced mobile check-in in the past year. The impact of the so-called sharing economy is increasing: in the city of Milan alone, the ‘vacation rental’ market is worth at least 177 million euros.
In 2019, Travel eCommerce grew by 9%, reaching €15.5 billion (driven by mobile, with +32%), but the overall market also grew, with 83% of agencies reporting increased revenue compared to 2018, and even a traditional segment such as main Tour Operators posting a +7%.
These are some of the figures presented in Milan at the Bovisa campus during the eighth edition of the Digital Innovation in Tourism Observatory of the School of Management at the Politecnico di Milano*, at the conference “Between web and retail, the unexpected tourist”.
“If for years eCommerce has ensured growth rates close to (or even above) double digits, in 2019 even the ‘traditional’ distribution channels have shown they can react to the crisis. In fact, 83% of Italian travel agencies expect revenue growth in 2019,” states Filippo Renga, Director of the Digital Innovation in Tourism Observatory at the Politecnico di Milano. “The Tourism market therefore seems to have enough room for both distribution models, digital and traditional, to coexist by ‘joining forces’ to meet the tourist’s different needs: digital (with its touchpoints, tools, and languages) in some cases becomes an enabling factor for process improvements even for those whose brand is built on physical retail.”
Summary
The tourist between digital and traditional sales channels
The Internet is increasingly a key partner in organizing Italians’ trips. 97% of those surveyed used it during the inspiration and research stages, and 85% to book the main vacation accommodation organized in 2019.
When it comes to reaching the destination, the digital channel remains the preferred method for purchases by tourists with Internet access: 88% of airline bookings, 86% of car rentals, and 83% of train tickets go through this channel.
For activities at the destination, in-person purchases still prevail (for 63% of tourists), but 57% also use the internet to book museums, tours, and restaurants. Among payment methods, cash remains widespread, being used for 51% of transactions for experiential activities, compared to 27% for accommodation and transport.
To get around at the destination, alternative solutions are also starting to gain ground: 11% of Italian tourists have used sharing mobility solutions.
Digital travel: mobile drives the sector
The smartphone is used by 90% of tourists during various stages of the tourist journey, especially for information searches (71%), purchasing services before the trip (33%), and sharing on social media or via reviews (33%). The most commonly used apps are those for searching and booking restaurants (41%) and local/tourist guides (35%).
But the internet is not the only partner. Italians show a strong attachment to physical retail (agents and travel consultants), who are approached by one in three (33%). “The main reasons for turning to experts are wanting greater assurance of finding the correct information (18%) and receiving adequate assistance when planning (17%). A surprising figure—though consistent with past years—is the age breakdown of agency users,” says Eleonora Lorenzini, Director of the Digital Innovation in Tourism Observatory of the Politecnico di Milano. “For a couple of years, evidence has shown that young people, especially those aged 25-34, are the ones who most appreciate expert support for vacation planning and choices. That’s why we chose the theme for the conference: understanding and managing the needs and behaviors of tourists—even the most unexpected ones—is key to staying competitive. In this ever-evolving scenario—also on the supply side (think only of how solutions related to artificial intelligence or the Internet of Things are spreading)—we believe the most effective response lies in creating and consistently evolving skills that enable each person to manage, rather than be overwhelmed by, change.”
Digital travel and accommodation facilities
One of the skills that can make a real difference concerns the collection and strategic use of data. For example, in the case of accommodation providers, this activity strongly impacts customer loyalty and the ability to maintain a significant share of direct bookings, which in 2019 accounted for 49% of total bookings, up slightly from previous years. The percentage of direct bookings rises to 52% in the hotel sector, while digital intermediation shows above-average figures (38%) when it comes to non-hotel establishments (such as B&Bs, farm stays, apartments, campsites, etc.).
Digital travel drives the non-hotel sector
The indirect component is mainly driven by the so-called sharing economy (and more generally by all peer-to-peer platforms created to facilitate rental and sharing of accommodation between individuals), which today represents a third of the digital housing market. A special focus on Milan reveals the notable potential of the vacation rental market: the value of online offerings in the city alone is at least 177 million euros. The significance of this market is further demonstrated by the rise of a new professional figure, the property manager, who manages properties professionally on behalf of owners. The research also shows that a business-minded management of accommodations ensures, on average, 26% higher revenue than non-professional management by private owners.
Digital travel, Anna Bruno’s book
The topic of Digital travel has been addressed by Anna Bruno, director of FullTravel, in her new book. “Digital Travel” is a handbook for tourism industry professionals. The first book with this title in Italy, it aims to guide industry professionals step by step through the complex yet fascinating world of digital.
“2019 was finally a good year for Italian tourism,” concludes Eleonora Lorenzini, Director of the Digital Innovation in Tourism Observatory at the Politecnico di Milano, “but it is important to remember that innovation will continue consistently, as we have seen over the last 20 years; in fact, there’s nothing to suggest there will be a slowdown, and to keep pace everyone will need to read and anticipate the signs of change. A key trend is sustainability—a concept that many talk about, but which is by no means easy to define, interpret, or showcase in tourism, and which is set to become the new paradigm by which everyone—tourists and businesses alike—will have to and want to learn to measure themselves in the coming years.”
The report on digital travel and the partners
The 2019/2020 edition of the Observatory was conducted with the support of Allianz Global Assistance, Altrama Italia, Amadeus, BWH Hotel Group | Best Western – World Hotels, CartOrange, CWT, Dishcovery, eMinds, Europcar Italia, FSTechnology, Gruppo Gattinoni, ITALIANWAY, Keesy, LiveHelp, Nexi, Soldo, TTG Travel Experience – Italian Exhibition Group, Zucchetti; Alidays Travel Experiences, Boscolo Tours, Creativa, Generali, PayPal Italia, Travel Appeal, Valica; with the patronage of ADACI – Associazione Italiana Acquisti e Supply Management, ANESV-Federturismo, Start-up Tourism Association, Assoturismo-Confesercenti, F.T.O. – Federazione del Turismo Organizzato, ITS Foundation for Tourism and Hospitality – IATH Academy and Travel for business.
Pubblicato in Digital Travel
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