Blockchain Transformation in the Tourism and Hospitality Sector

» The digitalization of the tourism and hospitality sector is a continuing evolution that transforms core business processes, market structures, and customer experiences. In this regard, blockchain is an important technological driver that can substantially change the ways in which existing and new service providers in this sector interact among themselves and with their customers.
» With its service orientation, the tourism and hospitality sector was hit particularly hard by COVID-19. International tourist arrivals have plummeted, and numerous lockdowns have reduced overnight stays, restaurant visits, and event planning and management. Blockchain-based applications may pave the way for alternative business models that can mitigate the negative impact of the pandemic.
» Blockchain applications can improve the efficiency of core business processes in the tourism and hospitality sector, including payments, reservations and ticketing, location tracking, identity management, and information sharing within supply chains. They can also transform customer relationships via decentralized booking systems, loyalty programs, and verifiable reviews. Start-ups and incumbents have opportunities to deliver these services.
» The market structures of the tourism and hospitality sector are changing. In recent years powerful online travel agencies (OTAs), web-based marketplaces that enable consumers to search for and book travel-related services, have accumulated substantial market power. Blockchain, as a distributed ledger, disrupts existing power structures by enabling peer-to-peer services. Current intermediaries may also adapt their business models by integrating blockchain-based services.
» The creation of virtual realities and the easy transfer of digital assets between peers in the form of non-fungible tokens (NFTs) present new business prospects for decision makers who seize the opportunity and can capitalize on their existing competencies. Offering tourism-related services and products in the metaverse presents an alternative revenue stream that necessitates rethinking how the sector does business.