Customer Experience Revenue in the Travel & Hospitality Industry Declined by 33% Between 2019 and 2021, According to Dash Research Diminished Travel Activity, Labor Shortages, and Outdated Technology Stacks Are Major Inhibitors to CX Software and Services Market Recovery
Denver, Colorado
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February 09, 2022 06:15 AM Eastern Standard Time
While all industry sectors have needed to pivot and flex to address the global pandemic, few other industries have had to reinvent their processes and solutions the way the travel & hospitality market has needed to. Constantly changing restrictions and regulations have made any sort of market recovery in this sector lumpy, at best. The travel & hospitality sector has always needed to walk the line between internal operational and cost efficiencies and personal attention to the guest or traveler. According to a recent report from Dash Research, the global COVID-19 pandemic caused many travel & hospitality companies to reassess their priorities and current technology status, focusing on those that will result in even greater efficiencies as they navigate the upcoming recovery, and provide a smooth, friction-free, and positive customer experience for those traveling.
Dash Research estimates that the global market for customer experience (CX)/customer engagement (CE) software and services totaled $3.5 billion in 2021, a 32.7% decline from 2019 when revenue for the sector was $5.2 billion. The market intelligence firm does not anticipate revenue returning to 2019 levels within the duration of its forecast period (2019 to 2026). Worldwide CX/CE revenue is forecast to rise moderately over the next several years, reaching $4.3 billion in 2026.
“The customer journey of a traveler can be complicated and leverages many disparate technologies,” says senior analyst Sherril Hanson. “The process of researching a trip via the wide variety of channels and third-party providers, booking, paying, moving through a transportation hub, and arriving at a destination of choice has a lot of opportunities to rise to the occasion to provide outstanding CX or fall short of expectations.”
Hanson adds that each touchpoint in that journey is an opportunity to build brand loyalty, trust, and positive emotions. Dash Research concludes that this is both a challenge and an opportunity for implementing CX technologies and services. While the industry will take some time to fully rebound, an exploration of CX in this sector demonstrates that it is a market primed to reap the benefits of implementing CX technologies.
Dash Research analysis indicates that the key market drivers spurring the purchase of CX software platforms, applications, and ancillary services in the travel & hospitality market include the following:
- Demand for omnichannel interactions and self-service along the various touchpoints
- Changes in the nature of the travel experience and a desire for personalization
- Acceleration of contactless and convenience technologies
- Increased communication needs
However, a multi-year global pandemic represents an unprecedented challenge for the travel & hospitality industry, and several key related market barriers that are tempering the growth of CX software and services include the following:
- Market uncertainty and budget constraints
- Fragmented and sometimes outdated technology stacks
- Labor shortages and employee burnout
- Consumer concern over health and safety issues
Opportunities abound for the growth of CX solutions in travel & hospitality, but amidst all the current challenges, these solutions must be implemented with a keen eye toward evolving consumer behavior and attitudes, greater efficiency and convenience for travelers, timely and personalized communications, and a strong and sustained focus on employee experience (EX) in an environment of scarce labor resources.
Dash Research’s report, “CX in the Travel & Hospitality Industry”, focuses on the software platforms, applications, and services that are offered to travel & hospitality companies to help them achieve excellent CX that leaves travelers feeling safe, satisfied, and eager for a return trip via all the companies that eased their journey. The report examines the current and future market issues, market drivers and barriers, and case studies within the travel & hospitality CX/CE industry. Market sizing and forecasts include segmentations by geography, functional area, product offering, and visibility to the customer. Discussion on the impact of the COVID-19 pandemic, and how the industry is responding, is also included. An Executive Summary of the report is available for free download on the firm’s website.
Dash Research, the market intelligence arm of Dash Network, provides in-depth research and insights on the worldwide CX market including a comprehensive assessment of technology solutions, business issues, market drivers, and end-user dynamics across industry sectors. Dash Research’s global market coverage combines qualitative and quantitative research methodologies to provide a complete view of emerging business opportunities surrounding contact center technologies, customer data & analytics, customer data platforms, customer insights & feedback, customer relationship management, personalization & optimization, and employee experience. For more information, visit www.dashresearch.com or call +1.720.603.1700.
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