Travel TechnologyFor travel agents, virtual spaces have the potential to spark the desire to travel and give a holistic idea of a destination.

Can the travel industry capture the $20b opportunity in metaverse?

McKinsey explores the potential of virtual travel in the metaverse, highlighting opportunities and challenges for the industry.
McKinsey explores the potential of virtual travel in the metaverse, highlighting opportunities and challenges for the industry. Photo Credit: Adobe Stock/AILA/

McKinsey and Co, in an extensive new report, has posed the question, ‘Can travel go virtual’, can the travel industry grab a US$20 billion opportunity offered by the metaverse.

The answer? Yes, no and maybe.

McKinsey suggests it’s time for the travel sector to take a serious look at the “complex opportunities” and to figure out what best drives traction in the new XR (Extended Reality) that is “still taking shape and many struggle to define”.

McKinsey suggests one way to grapple with this complexity is to adopt a traveller-first mindset. By putting themselves in the shoes (or bedroom slippers) of their target tourist, travel companies can identify opportunities to embed relevant virtual elements.

There are touchpoints where the disruption potential of the metaverse is still debatable, or where opportunities may take longer to mature, the report notes.

For travel agents, the news is not too bad.

Customers are already comfortable with online booking, so a shift to XR interactions with virtual travel agents could be seamless, according to McKinsey.

“However, this is a relatively small business opportunity, with uncertain added value: the new technology is not expected to change or boost the functionality of current booking processes in any fundamental way,” the global management consultants say.

The report indicates there is currently limited interest in adding virtual elements to aspects of travel that are necessarily physical, such as mobility, accommodation, the logistics of arrival and departure, and food and drink (F&B).

“Instead, we’ll most likely see a proliferation of hybrid offerings, with virtual events, edutainment, and inspiration combined with physical destinations.”

Where XR will shine, the report notes, will be virtual spaces—which can be used to showcase hotel amenities, airline classes, or an entire landmark—”spark the desire to travel, give a holistic idea of a destination, help in traveller decision-making, showcase broader offerings, and raise awareness of unfamiliar locations.”

Source: WiT

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