Accelerating the pace of digital transformation in the tourism sector
Update: Oct 05, 2020
The Covid-19 pandemic has been seriously affecting the economy in general and the tourism industry in particular, while reflecting that traditional management and business methods are not adequate in coping with the disease, requiring immediate digital transformation to enable enterprises and management agencies to improve capacity and business efficiency to maintain operations and develop.
General view of a forum themed "Digital transformation for development of Vietnam tourism" in Hanoi on September 30
According to the latest forecasts, COVID-19 has caused damage of US$1 trillion to the global tourism sector and a reduction of 61% to Vietnam’s tourism revenues compared to 2019. Challenges in the context of the pandemic have increasingly required the tourism industry to implement digital transformation solutions and establishing a smart tourism data integration and sharing system, thereby creating added value for the industry’s products and services. The application of advanced digital technologies will enable businesses to better understand customers and personalise their service and incentive packages based on customers’ preferences, while reducing costs, optimising profits and making their work processes more scientific, rapid and efficient. This will also help enhance competitiveness of domestic tourism companies and create more positive change for both customers and tourism businesses. From customers’ perspective, through smart phones using digital applications, they will be able to perform a wide ranges of activities from planning trips and selecting means of travel and travel agents to booking hotels and the receipt of post-trip preferences, instead of directly contacting tourism companies.
Recently, Vietnam’s tourism industry has launched the online tourism mobile app “Du Lich Viet Nam An Toan” (Safe travel in Vietnam) that integrates electronic payment and the monitoring of public health in just one card. The app is aimed at more than 43 million smart phone users. This is a useful tool for travellers in recommending safe destinations and advertising destinations to tourists, as well as effectively serving the second domestic tourism stimulus programme. The app is also considered to be one of the practical digital transformation activities of state management agencies in the tourism industry. The Ministry of Culture, Sports and Tourism has requested the Vietnam National Administration of Tourism to take immediate measures, such as accelerating the application of digital technology for tourism marketing, smartly managing tourist destinations, building big data and information systems for common use, and spreading digital technology to all levels and branches to support Vietnamese tourism development.
The digital transformation process in Vietnam’s economy is still moving, but whether the pace is fast or slow depends on the capability, the sense of responsibility and the efforts of enterprises, organisations and local authorities, in addition to the drastic engagement from levels and branches. Tourism is an integrated economic industry with deep cultural content and close relationships with many other industries such as security, transportation, health and trade, therefore its digital transformation requires the synchronous, close and long-term coordination of many components based on a strong and unified technology foundation. Digital transformation is not only about technology but also the management, approach and promotion methods. This requires innovation in both thinking and action of the entire sector, from management agencies to businesses.
Vietnam currently has nearly 44 million smart phone users, more than 67 million internet users, approximately 66 million social media users, and 145 million mobile subscribers. These provide a premise for promoting digital transformation in all industries, especially the tourism sector. In June 2020, the Prime Minister approved a national digital transformation programme until 2025, with a vision to 2030. Accordingly, Vietnam aims to become one of the 50 leading countries in terms of information technology, with the digital economy to account for 20% of GDP by 2025. This is also an important corridor and support for economic sectors as a whole and the tourism industry in particular to accelerate their digital transformation pace. And the COVID-19 pandemic, with its negative impacts, will become a powerful boost to make the digital transformation process in the tourism industry faster and more profound if opportunities from this reality are effectively utilised.