The global travel and tourism industry contributes 7.61 trillion US dollars to the global economy per year, with worldwide digital travel sales amounting in 565 billion US dollars per year. When it comes to online travel transactions, Expedia and Priceline have a monopoly on 95% of the industry. This may however be challenged in the near future, with Blockchain creeping in to shake up the travel industry, making travel more affordable and less complex.
Winding Tree developing platform for suppliers
One of the first initiatives to bring Blockchain to travel was started this year by the Winding Tree Company. The organisation has started developing a Blockchain platform that links suppliers (hotel, airlines, rental car companies) to sellers (travel agencies) in a unified marketplace /3/. Suppliers can enter data on their offers and sellers can purchase these offers directly through smart contracts, without having to go through a third party.
Lufthansa recently announced a partnership with Winding Tree to explore Blockchain use cases for booking and travel itinerary information in preparation for the implementation of Blockchain based travel apps /4/.
Travel loyalty programs to be revolutionised
Another point where Blockchain is entering the travel industry is in travel loyalty programs. Travel loyalty programs award members points based on certain purchases, and can be redeemed normally for travel miles. These programs are intended to benefit customers, but are often confusing and vague for those using them because of the variety of currencies being used, different values for types of travel, and different rates applied.
When Blockchain is applied to travel loyalty programs customers can keep track of various memberships in one place. This would reduce the complexity of such programs by giving customers a way to easily see where they are accumulating points and manage those points easily /2/.
Trustworthy travel insurance with Blockchain
Travel insurance is an industry that has grown considerably in the last several years and is an additional area where Blockchain is being explored. This would function as a network of smart contracts set to issue pay outs when flights are delayed or canceled /1/. This would simplify the claims process and tackle the issue of trust for insurance customers; companies would benefit from being able to ensure customers that they would receive payouts without having to expend excessive time and effort.
Travel companies getting in on Blockchain now have the opportunity to build partnerships with innovators that will carry them through the digitalization process, and also help them present attractive options to customers. To find out more about how Blockchain is changing many industries and how Blockchain could benefit your industry, contact us here.