Web3 Is Proving Itself in Travel
A preview of one of Phocuswright's Travel Innovation and Technology Trends 2023: Roundup: Web3 Is Proving Itself in Travel
After years of hype, 2023 is proving to be a pivotal year for Web3 as this set of decentralized technologies is now delivering concrete, measurable value to the travel industry. Many Web3 companies have only emerged within the last several years but are already driving changes in the way travel is booked, paid for, exchanged and settled.
Critics who characterize Web3 as a technology looking for a solution may be surprised to learn that some Web3 startups are actively generating revenue and decreasing costs throughout the travel industry. Clearly, Web3 has moved from concept to practical use cases, and is poised to grow rapidly in the value it provides to the industry.
Examples abound around travel. Phocuswright's latest travel research report on the topic Roundup: Web3 Is Proving Its Value in Travel includes a full summary of concepts in play today, with specific examples. Below are excerpts from the full report:
- Efficiency and lowering cost of payment/settlement
- Transforming loyalty
- Creating a direct distribution environment for airlines, hotels and short-term rentals
- Enabling large hotel chains to connect directly with their most favored distributors
- Creating NFTs (non-fungible tokens) for hotel reservations and airline tickets
- Promoting attribute-based selling of hotel rooms
- The emergence of dedicated ecosystems governed by the travel industry
Separating the Hype From True Business Impact
As with any emerging tech trend, expectations are often inflated, especially on day-to-day travel business practices. In the case of Web3 and blockchain, the promise for a new, decentralized travel infrastructure may seem far away as traditional Web2 players still dominate all aspects of travel booking and distribution. But things are changing fast.
There are dozens of startups focused on some aspect of Web3, with new startups emerging monthly. Many of these startups are providing travelers with new capabilities and flexibility while impacting overall cost of distribution and settlement for industry players.
Reviewing the Landscape
The full report contains an in-depth summary of 17 companies that are achieving real-world success by implementing Web3 technology. Sources for company information include vendor conversations, vendor websites, PhocusWire articles and Web3 Travel Tech Startups by Mauricio Prieto.
The full report includes:
- How the company is using Web3 technologies
- Value to the travel industry
- Current progress and traction
- Outlook for 2023
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Company, year founded, primary segment focus |
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Founded: 2018
Key Segment: Focusing on hotel distribution with a hotel's corporate and leisure partners |
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Founded: 2017
Key segment: Enterprise travel booking and payments |
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Founded: 2021
Key Segment: All leisure segments |
|
Founded: 2017
Key segment: Vacation rentals |
|
Founded: 2020
Key Segment: Hotels and Resorts |
|
Founded: March 2022
|
|
Founded: 2017
Focus: Hotel and short-term rental distribution |
|
|
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Founded: 2021
Focus: Connecting virtual reality (VR) with real-world benefits |
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Founded: 2022
Focus: Hotels, resorts, cruise lines, adventure travel, airlines, entertainment – plus a few experience brands |
|
Founded: 2020
Focus: Membership-based primary and secondary market for hotel rooms |
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Focus: WindingTree – Decentralized travel distribution marketplace (WTDM)
Simard – Corporate travel |
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Founded: 2019
Focus: Operates high-end hostels with dedicated co-working spaces in repurposed buildings catering to digital nomads and traditional travelers.
|
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Founded: 2017
Focus: Consumer travel
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Founded: 2021
Focus: Entire travel industry, starting with airlines |
|
Founded: 2022
Focus: Social travel commerce |
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Founded: 2020
Focus: Payments |
Conclusion
Web3 is still in its infancy, but the momentum is only accelerating on development. There are many looming challenges for Web3 companies. Based on the updates discussed above, these challenges are finally beginning to be addressed and it’s only a matter of time until adoption reaches critical mass.
Notably, major tech companies and organizations are laying the foundation for interoperability between decentralized identity (SSI) and decentralized applications. This represents a major step necessary to bring the full Web3 vision to life. Forward-looking travel companies will be planning for this phase when it arrives.
This article is part of a content series that explores some of the most impactful innovation and technology-driven trends that will influence the travel industry in 2023 and beyond.
- The Future of Social Media, Influencers and Social Commerce in Travel
- Web3 Is Proving Itself in Travel
- Green Travel Innovation Now (Yes, Now!)
- No Travel Experience Necessary: More Outsiders Enter the OTA Market
- Generative AI: Transforming the Travel Cycle
- Real-time Revolution in Hotel Operations
- eVTOLs in Travel: Viable Addition or Flights of Fancy?
- Super Apps’ Secret Sauce
Watch the online event that covered each trend, presented by Phocuswright analysts:
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