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
“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
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.”