Travolution Innovation Report reveals rise in travel tech spend

There was a 4% year-on-year increase in spending on travel technology in 2016, the Travolution Innovation Report has found. Released to delegates at EyeforTravel on Thursday, the Innovation Report is an annual breakdown and analysis of tech spending in the travel … Continue reading →

There was a 4% year-on-year increase in spending on travel technology in 2016, the Travolution Innovation Report has found.

Released to delegates at EyeforTravel on Thursday, the Innovation Report is an annual breakdown and analysis of tech spending in the travel sphere.

There was a 4% increase in travel technology spending in the UK 2016 compared to 2015, driven by advances among travel agents and tour operators.

But the increase was less than the rise in spend on technology across all UK industries, which was 6% – the first time travel has spent below the UK average on technology since 2012. In the last three years, travel increased its technology spend by 8%, 10% and 10%.

Through the figures, our expert analysts have predicted that spend is set to rise again next year – by 5%, the same forecast given to the average across UK industries.

Travel accounts for 1.12% of global and UK tech spend, although this has increased gradually over the last few years.

Data, collated by the ONS, included tech spend per employee for sectors within the travel industry, including passenger water transport, passenger air transport and hotels, as well as travel agencies and tour operators.

All were above the average, except for hotels which have high numbers of staff employed.

Travel agents – which employ 58,783 staff across 3,800 enterprises in the UK – spent a total of £512.48 million on IT in 2016, a year when we also saw a drop in the number of staff employed in the sector for the first time since 2013.

In the tour operating market, 1,840 enterprises employ 21,274 employees and spent a total of £180.4 million on IT in 2016.

Hotels, with 344,900 employees across 9,350 properties, spent £270 million on technology.

Within 500 enterprises in the air transport sector, £427 million was spent on technology in a sector that employs 74,174 people.

And in water transport, £53.2 million was spent by 587 enterprises with a combined 8,892 staff.

The report, which you can view online, also breaks spend down by category – including software, hardware, computer services, telecom services and IT and telecom staff.

Travolution editor Lee Hayhurst said: “There’s plenty in the report to get your teeth into and some thoughts about why these figures are what they are.”

The annual Innovation Report features commentary from software specialists Atcore and hotel metasearch engine Hotelscombined – and was suported by EyeforTravel. It also features an update on IAG’s Hangar 51 programme for start-ups and a rundown of Hack Horizon’s Hack on a Plane.