Centralization, lack of transparency, and manual processes cause inefficiencies in the travel industry – blockchain technology can solve some of these challenges
The travel industry has seen high levels of digitalization over the past years. According to Adobe Digital Insights, 41 percent of business and 60 percent of leisure travel arrangements are nowadays made online. Of course – who wants to have a hassle when booking a holiday. It’s supposed to be relaxing after all.
But it’s about more than just a holiday booking. Technology, especially AI and blockchain technology, will disrupt the travel industry over the years ahead. Here are three exciting use cases:
IBM Travel Manager: AI and blockchain-based platform to optimize corporate travel spending
Travel spending accounts for a big chunk of many company’s expenses. Most corporations have standardized corporate travel programs that set the rules for employee travel, but those programs are difficult to manage. With annual global business travel spend estimated to reach a record $1.2 trillion this year, as projected by the Global Business Travel Association, corporate travel managers are looking for new ways to reduce costs.
Travelport, the leading travel commerce platform, has introduced IBM Travel Manager in cooperation with its technology partner IBM. It’s an AI-platform designed to help businesses manage their travel spend. The platform can intelligently track, manage, predict, and analyze travel costs in one place to enable companies to optimize and manage their corporate travel programs.
The IBM Travel Manager is also an excellent example of a platform combining AI technologies and blockchain. While the AI-element optimizes travel programs via machine learning, blockchain allows Travelport to securely store data and link multiple content sources in the travel supply chain.
Travelport’s blockchain-based hotel commission reconciliation
Besides the IBM Travel Manager, Travelport and IBM are also developing a blockchain-based solution for hotel commission reconciliation processes. Currently, commission reconciliation in hotels lacks traceable audit trails and is often done manually. That ultimately leads to mistakes and results in stakeholders not being duly compensated.
Working with several high-profile hotel chains, Travelport aims at a solution where multiple stakeholders – such as hotels, agencies, or booking platforms – can share data on a distributed ledger. By creating an accurate and traceable shared view of the booking status and commissions, all parties stand to win.
Winding Tree: a decentralized hotel booking platform
Although the travel industry seems relatively competitive, it isn’t. Most travel websites collaborate with the same global distribution systems (GDS), for example Amadeus or Sabre. These systems employ real-time inventory technology to collect data on flights and hotel rooms and provide these data to travel agents or corporate travel bookers.
Most airlines, hotels, and booking platforms work with GDS. As there is little competition, GDS providers take a big chunk of the profits, often up to 20 percent.
To lower the costs of travel, Switzerland-based Winding Tree is creating a blockchain-based decentralized platform for booking and securing transactions. It offers an alternative to GDS and allows providers like airlines and hotels to publish available inventory to potential customers directly without the need for B2B intermediaries that inflate the prices.
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