The Promise of Travel in the Age of AI

Every generation has its own “golden age” of travel that is often defined by the widespread adoption of new technology—from the jet engine of the 1950s that drastically reduced travel times to the dotcom period of the 1990s that allowed customers to build their dream itineraries online. Now, a new era of digitally enabled travel is upon us, with advances in artificial intelligence (AI), including generative AI (GenAI), machine learning (ML), and analytics transforming the experience. Applications span travel organizations and use cases from AI-enabled trip planning, to individually tailored communication during disruptions, to live simulation models and virtual reality (VR) training to improve frontline decision making.

Technology has influenced the way consumers experience travel, too. According to Skift Research, people have increased time spent on digital devices by 70 percent since 2013. 1 This trend accelerated during the COVID-19 pandemic, when online interactions frequently replaced in-person contact and consumers became more accustomed to using digital tools. However, travel is unique in that it can only happen in person, making it an inherently human-centric experience. The industry currently has an opportunity—and perhaps even a duty—to define what this looks like in the digital age.

While most travel companies aim to provide exceptional service and deliver the perfect trip, the average traveler’s experience is often far different. Operators inconsistently deliver on baseline expectations of timing and quality (e.g., itinerary changes, delays, and cancellations) and too often create feelings of stress and anxiety in customers. Despite this, people still aspire to travel. Digitally enabled travel gives companies the opportunity to close the persistent gap between promise and reality.

Larger companies may have more resources to invest in new technologies and develop in-house capabilities. Fortunately, a robust ecosystem of service providers has emerged that makes new technology accessible to companies of all sizes. According to McKinsey Digital estimates, by holistically addressing digital and analytics throughout the organization, including AI, companies across industries see a 15 to 25 percent potential EBIT improvement. This is an opportune time for businesses across the travel industry to start setting the pace for value creation by rethinking how they interact with customers, develop and deliver products and services, and manage people and operations.

This report is intended to inspire travel companies to reimagine their businesses, raise the industry’s aspirations, and unlock long-term stability and growth—all necessary to keep the magic of travel alive. It is not a step-by-step guide to digital transformation. It offers use cases and success stories that detail how technology is being used, and presents examples and insights drawn from interviews with executives at 17 companies across five types of travel businesses.