Accelerating Digital Transformation for Tourism Development in New Normal

10:01:57 AM | 28/12/2020

Due to the adverse impacts of Covid-19 on the economy and society, tourism authorities and travel businesses have increasingly recognized the importance of digital transformation. This is considered an inevitable trend, not only an effective recovery solution but also a helper for sustainable tourism development.

Pandemic-hit tourism industry

In 2019, Vietnam ranked one of 10 fastest growing tourism countries in the world and 4th in the ASEAN region in attracting international visitors. The growth of the last three consecutive years was 22% annually. The number of international visitors to Vietnam increased from just 5 million in 2010 to 18 million in 2019 and tourism revenue was estimated at VND720 trillion (US$31 billion) in 2019. In particular, only in January and early 2020, for the first time, Vietnam welcomed two million international visitors. But shortly after this, the Covid-19 pandemic broke out all over the world in February 2020, and all social and economic areas were severely affected. Rated as one of the hardest-hit industries, tourism faced unprecedented difficulties, even sometimes completely inactive. Accordingly, about 40-60% of tourism workers lost their jobs or had working days cut, 95% of international travel businesses stopped operations, air flights were canceled, hotels and catering services closed their operations. As of November 2020, international visitors to Vietnam reached 3.82 million, down 76.6% over the same period of 2019 and the number of domestic visitors was 49 million. Tourism revenue was estimated at VND280 trillion (US$12 billion), down 56.8% year on year.

At the National Tourism Conference in 2020, Minister of Culture, Sports and Tourism Nguyen Ngoc Thien said, “Since the beginning of 2020, the Covid-19 pandemic has adversely affected the tourism industry of Vietnam and the world. Tourism slump resulted in steep decline of many related industries. In 2020, international visitor arrivals to Vietnam were forecast to fall by over 80% and domestic tourist arrivals were projected to drop by 45%. The total loss was estimated at US$23 billion."

Although the Covid-19 pandemic in Vietnam has been controlled for the time being, inbound and outbound tourism is still restricted due to pandemic infections in countries, however.

“Domestic tourism started to recover but it is only a temporary solution to help the tourism industry to wait for the end of the pandemic. It is very difficult to offset the fall in international visitors as well as the slump of domestic tourism earlier in the year. This is the time when the entire tourism industry needs to restructure and conduct digital transformation to prepare for a longer, more sustainable development,” said Mr. Pham Tien Dung, Vice Chairman of Unesco Hanoi Travel Club.

Digital transformation for more sustainable development

Deputy Minister of Culture, Sports and Tourism Nguyen Van Hung said that digital transformation is an inevitable trend that needs to be strengthened in the wake of negative impacts of the Covid-19 pandemic. The application of digital technology helps localities develop smart tourism and increase tourist experiences.

In fact, digital transformation in the tourism industry has been underlined in the past few years. Some localities and businesses started to approach this trend but they lacked focus. Faced with negative effects of the Covid-19 pandemic, tourism businesses are clearly seeing the importance of digital transformation. Digital technology not only helps businesses operate neatly and quickly but online tools also help find and share information, order services, and settlement payment efficiently. Many virtual tourism models have emerged through the application of virtual reality and augmented reality, helping visitors to have unprecedented experiences.

Mr. Le Tuan Anh, Director of the Tourism Information Center under the Vietnam National Administration of Tourism (VNAT) said, “Currently, most tourism activities take place in a digital environment, from booking tickets, booking tours and buying services to simpler behaviors like check-ins in destinations. This allows us to collect visitor behaviors for analysis in the face of modern technology."

In fact, digital transformation in the tourism industry is not necessarily a monumental solution such as big data, blockchain and artificial intelligence, it is often simply reaching out to customers through social networking applications such as Zalo, Facebook and Google, building a customer management system, destination data information, and special promotions.

Deputy Minister Nguyen Van Hung said, the Ministry of Culture, Sports and Tourism asked the Vietnam National Administration of Tourism to foster tourism advertising, transaction and management by applying information technology; calling businesses to quickly catch up with this new trend and actively apply new technologies to tourism activities.

Basic contents of the digital transformation program for the entire tourism industry must be built on a travel data platform and a digital technology system to automate processes of providing products and services to tourists, marketing, administration and monitoring to ensure service security and safety, improve quality, increase labor productivity and bring high value to businesses.

In addition, the tourism industry needs to promote e-commerce application, make online tourism a key channel to provide products and services to tourists, expand tourism scope, create product distribution channels and link service providers to form a complete, fast supply chain.

In addition, the tourism information system and tourism input database system must be synthesized and developed to create interaction and compatibility with other organizations. Big data must be big for everyone to use. The ministry also assigned the Vietnam National Administration of Tourism to call on businesses to jointly launch, respond and create great innovations in information technology application for tourism development.

By Giang tu, Vietnam Business Forum