Artificial Intelligence in Travel Market Size, Share, Growth, And Industry Analysis by Type (Hardware, Software, Service, ) by Application (Personalized Recommendations, Virtual Assistants and Chatbots, Sentiment Analysis, Predictive Analytics, Others) Forecast From 2025 To 2033

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ARTIFICIAL INTELLIGENCE IN TRAVEL OVERVIEW

The global Artificial Intelligence in Travel size was approximately valued at USD 2.8 billion in 2024 and is expected to reach USD 20.862 billion by 2033, growing at a CAGR of about 25% from 2024 to 2033.

AI is used in travel to enhance, automate and personalize different parts of your journey. Artificial intelligence is simplifying travel business operations, boosting how customers are helped and making it easier for both guests and workers to take choices.

GLOBAL CRISES IMPACTING ARTIFICIAL INTELLIGENCE IN TRAVEL MARKET

COVID-19 IMPACT

Artificial Intelligence in Travel Industry Had a negative Effect Due to Temporary Disruption in Demand during COVID-19 Pandemic

The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to market’s growth and demand returning to pre-pandemic levels.

In the opening phase of the pandemic, worldwide travel bans and lockdowns led to a big fall in demand for travel services. Since then, the travel sector saw a major decrease in investments in AI solutions.

LATEST TRENDS

Personalized Travel Planning through Generative AI to Propel Market Growth

Travel companies are now able to give customers experiences that are tailored to them through Generative AI. AI examines what people like, how they have traveled before and live data to prepare personal travel plans, point out destinations and provide engaging previews of journeys. When personalization is done, it improves how satisfied customers feel and how involved they are with the business.

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ARTIFICIAL INTELLIGENCE IN TRAVEL SEGMENTATION

By Type

Based on type the global market can be categorized into Hardware, Software and Service.

• Hardware- AI hardware is made up of physical tools and devices needed to use AI technology in travel.
• Software- It enables travel companies to deal with decisions and tasks more efficiently and accurately.
• Service- AI service means the deployment, integration and support offered by AI solution providers for travel businesses.

By Application

Based on application the global market can be categorized into Personalized Recommendations, Virtual Assistants and Chatbots, Sentiment Analysis, Predictive Analytics and Others.

• Personalized recommendations- AI allows travel companies to provide customized tips by reviewing each person’s history, likes and dislikes and recent activities.
• Virtual Assistants and Chatbots- Travel companies now depend on AI-based virtual assistants and chatbots to answer questions quickly and efficiently any time of day.
• Sentiment Analysis- AI is used by sentiment analysis to read and analyze feedback given on social media, on review websites and through surveys.
• Predictive Analytics- Thanks to AI, travel companies can understand how much travelers will want, determine the right prices and organize available resources.

MARKET DYNAMICS

Driving Factors

Growing Demand for Personalization to Drive Market Advancement

One of the key driving factors in the Artificial Intelligence in Travel market growth is the Growing Demand for Personalization. Nowadays, people look for travel packages that match their likes, affordability and habits. AI tools allow companies to review a lot of customer information and give specific suggestions for place to visit, where to stay and what to do.

Increasing Use of AI-Powered Chatbots and Virtual Assistants to Expand the Market

Because customers want help around the clock, chatbots and virtual assistants are now necessary in the travel industry. Without being controlled by a person, AI systems schedule bookings, answer questions, offer itineraries and send notifications to travelers in real time. Their use brings down operation fees, increases how effectively services work and pleases users mainly in times of high travel numbers or emergency.

Restraining Factor

Data Privacy and Security Concerns to potentially impede Market Growth

Worries about data safety and privacy are holding back the growth of the AI in travel market. To function well, AI systems need access to many details about a person’s travel, how they pay and what they like. Even so, gathering and handling this data is becoming a significant concern for privacy, due to more users being aware and because of tough regulations like GDPR and CCPA.

Rise in Online Travel Services and Mobile Apps To Create Opportunity for the Product in the Market

Opportunity

Because of how common smartphones and the internet are, more people are now booking their travel online and through apps. To make these platforms smarter, AI methods, including NLP and machine learning, are being used to let chatbots answer customer service questions, control booking processes without a travel agent and settle queries immediately. This leads businesses to use AI in order to enhance the way users use digital products.

High Implementation Costs Could Be a Potential Challenge for Consumers

Challenge

Using AI in the travel industry calls for spending money on technology, educating people and constantly looking after the systems. Because these costs are high, many small and mid-sized travel firms cannot use AI, with only large businesses using it. Since it’s common for companies to see results from AI at a slow pace, many are reluctant to dedicate big investments to it.

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ARTIFICIAL INTELLIGENCE IN TRAVEL REGIONAL INSIGHTS

• North America

North America has emerged as the most dominant region in the Artificial Intelligence in Travel market share due to a convergence of factors that propel its leadership in this dynamic industry. Currently, North America leads the artifical intelligence (AI) travel industry, mainly thanks to the U.S.’s developed tech base, high AI investment and many tech companies and travel firms present here.

• Europe

Due to a strong tourism market, many digital resources and growing attention on smart cities and greener travel, Europe has a significant place in the AI used in travel.

• Asia

Rapid changes in technology, a growing middle class and more travel activity in China, India, Japan and South Korea are driving the fast growth of Asia Pacific in the AI travel market.

KEY INDUSTRY PLAYERS

Key Industry Players Shaping the Artificial Intelligence in Travel Market Through Innovation and Market Expansion

Key enterprise players are shaping the Artificial Intelligence in Travel marketplace through strategic innovation and marketplace growth. Major members in the artificial intelligence in travel market are using innovative technologies and forming partnerships to maintain and grow their role in the market. They are putting a lot of money into AI to ensure travelers receive custom advice, changing prices and ongoing updates based on their actions and likes.

List of Top Artificial Intelligence in Travel Companies

• Skyscanner (U.K.)
• Airbnb (U.S.)
• Sabre (U.S.)
• Expedia Group (U.S.)
• Amadeus (Spain)

KEY INDUSTRY DEVELOPMENT

Feb 2023:  Ernie bot was created in English and named Wenxin Yiyan in Chinese when Baidu’s AI chatbot made its debut. That’s why Baidu shares experienced a rise of more than 13% in Hong Kong.

REPORT COVERAGE

The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.

The research report delves into market segmentation, utilizing both qualitative and quantitative research methods to provide a thorough analysis. It also evaluates the impact of financial and strategic perspectives on the market. Furthermore, the report presents national and regional assessments, considering the dominant forces of supply and demand that influence market growth. The competitive landscape is meticulously detailed, including market shares of significant competitors. The report incorporates novel research methodologies and player strategies tailored for the anticipated time frame. Overall, it offers valuable and comprehensive insights into the market dynamics in a formal and easily understandable manner.