As we kick off 2026, Phocuswright analysts have their eyes trained on what might happen in the new year.
The group has thoughts on how technologies will advance the industry, including agentic artificial intelligence (AI), biometrics and more. Experiences and personalization are likely to remain a focus, according to analysts, and changes in pricing and ground transportation are on the table too.
Read their predictions in full below.
Editor's note: Responses have been edited for clarity and brevity.
Fabián González, market analyst, Spain
- The inexorable integration of AI into every stage of travel will, paradoxically, sharpen the focus on what truly matters—the human element. From inspiration to booking and throughout the travel experience, AI will amplify, not replace, the value of human connection that should never have been overlooked.
- We already rely on biometrics on our phones—whether fingerprint or facial recognition—to log into platforms and apps or to authorize payments from our digital wallets. The next step is leveraging biometrics to elevate the travel journey itself, from airport passport control to hotel check-in. Travelers will be willing to use their biometric data if, in addition to ensuring anonymity and traceability, it leads to a noticeably smoother and more seamless experience.
Shadi Kaddoura, senior market analyst, Middle East
- By 2026, the Middle East’s travel industry will be profoundly influenced by advanced digital technology. An ATM/Travel Economics study finds 60% of UAE travelers already trust AI to plan every aspect of their trips (versus around 48% elsewhere), and nearly six in 10 have used AI tools when booking Middle East holidays. Gulf operators are embedding generative AI into service platforms (Sabre’s SynXis Concierge uses AI-driven natural language to handle guest queries), while airports are rolling out frictionless biometrics: Dubai International’s new “Unlimited Smart Travel” biometric corridor processes passport control via face recognition in around 14 seconds, with plans to extend fully borderless e-gates at Al Maktoum airport.
- Likewise, blockchain “tokenization” is emerging in tourism: Ras Al Khaimah’s tourism authority is piloting a blockchain rewards platform that issues digital travel tokens for curated experiences and loyalty. Taken together, these indicators suggest that by 2026, the Middle East will feature pervasive AI-driven personalization, seamless biometric identity controls and crypto/blockchain-based payment or loyalty systems, fundamentally reshaping both traveler experience and operational models.
- The Middle East will further cement itself as a hub of ultra‑luxury, experience‑driven tourism. Industry analysts note the Gulf Cooperation Council is “at the forefront of redefining luxury tourism,” with huge investments in world‑class destinations focused on personalization, wellness and multi‑generational appeal. Major hospitality groups are adding a wave of high‑end projects: Four Seasons announced six new Saudi properties, including a wellness‑oriented resort and a regenerative resort. Evidence indicates that by 2026, Middle East tourism offerings will be dominated by ultra‑luxury eco‑resorts, bespoke cultural‑heritage experiences and tailored wellness retreats, as key differentiators in the global travel market.
Norm Rose, former senior technology and corporate market analyst
- The industry will go through a number of growing pains, but in the end agentic AI will create new opportunities for supplier-direct while reinforcing the value of inventory aggregation through online travel agencies (OTAs). The day will arrive in the not-too-distant future where a simple voice command or calendar entry will initiate a travel search and booking process that delivers better content and simplifies the process of travel planning and booking for the masses. But first, data governance must be addressed, and silos must be broken down.
- The coming agentic era will be as significant as the change triggered by the internet itself. There will be winners and losers, all dictated by how serious existing players take these trends and how much investment they make to operate in the genAI/agentic future. Those who ignore this trend do so at their own peril.
Bing Liu, director, surveys and analytics
- Travel in 2026 will revolve around experience and personalization, as travelers move away from checklist-style vacations and seek trips that feel meaningful and tailored to their interests. Instead of simply visiting major attractions, people will look for curated itineraries that reflect their passions—whether that’s food, wellness, culture, nature or unique local encounters. AI-powered technology will play a key role, enabling hyper-personalized recommendations and seamless planning, while travelers themselves will prioritize authenticity, connection and storytelling over simply ticking off landmarks. Overall, personalization will turn travel into something more intentional and emotionally resonant.
Robert Cole, senior research analyst, lodging and leisure travel
- Agentic AI will become a primary interface for trip planning, but most of the travel industry isn’t ready, as three forces collide. Travelers want a personal AI agent to holistically consider their travel party’s preferences to create a unique, memorable experience while considering full eligibility for the best possible deals. Travel suppliers will expect their agents to present the exhaustive product content they have created for inclusion in every consideration set but also risk that content serving as the basis for conversion through lower-margin indirect booking channels. The frontier AI labs, operating at below-cost compensation levels to gain share, will need to constrain compute tokens, context windows or the number of external data sources considered for ingestion. Trusted agents optimized for completeness, execution quality and business model will be favored. Even the suppliers and intermediaries providing AI agents with clean, well-structured content, inventory and policies via robust APIs will be challenged to discern the success of discovery and conversion performance optimization tweaks due to the opacity of decision-making within large language models (LLMs), sourced from data coalesced across multiple agentic layers.
- Digital identity will become essential for the travel industry to address risk, compliance and personalization. Nearly every aspect of travel presents high-friction use cases that involve both traveler and organizational identity, which must be grounded by authoritative sources of truth. Adding further complexity, global governance of identity regulations is not only fragmented, but it is also seeing three divergent approaches between China, the U.S. and the EU. Travel suppliers, travel management companies, OTAs, payment providers and agentic AI agents will begin requiring cryptographically verifiable proofs of traveler identity, affiliation and offer eligibility, with business legal entity status, beneficial ownership, licensing, tax compliance, etc. Supporting digital identity and payment wallets will reduce fraud, accelerate agentic commerce and enhance personalization—all of which require confirmable trust and identity.
Coney Dongre, research manager
- India and South Korea are rapidly emerging as Asia’s next outbound power blocs, with South Korea nearing 29 million overseas trips in 2025 and India accelerating on the back of rising incomes and visa liberalization. Their growing scale is already shifting destination priorities, prompting more tailored products and increased air connectivity. In 2026, these two markets are expected to shape the region’s most competitive battleground for long-haul tourism.
Mike Coletta, senior manager, research and innovation
- As of late 2025, 39% of U.S. travelers were actively using AI to research and plan trips across the major AI platforms like ChatGPT and Gemini, Google’s AI Overviews and AI Mode and AI features in travel apps and websites. This is up from 28% a year earlier. If this growth rate holds, usage will likely crack 50% in 2026. Meanwhile, use of general search engines for trip research and planning has plummeted to 36% from around 50% in 2023 and 2024. As conversational, autonomous AI takes over as the front door of travel from keyword-based search, the business models and interfaces we’re used to will begin to meaningfully erode.
- Travel startup funding, in both deal count and dollars, will remain far below the peaks of 2018 and 2021 as AI continues to cause uncertainty and structural realignment in the market amid a complicated economic picture. However, AI-native and AI-enabled companies will punch far above their weight in 2026, running unprecedentedly lean, automated workflows with tiny teams and limited capital. We could even see the first multimillion-dollar travel company built by a solo founder.
Gary Bowerman, research analyst, Asia Pacific
- Inbound travel to China will continue to expand and diversify, particularly from Asian markets. Curiosity to explore China beyond the obvious destinations, like Shanghai, Beijing, Hangzhou and Xi'an, is developing, and cities like Chengdu, Chongqing, Changsha, Kunming and Guiyang are firmly on travelers' radars. These offer access to some of China's most beautiful landscapes plus unique cultures and cuisines—and are gaining popularity with second- and third-time visitors to China from Southeast and Northeast Asia. Watch out for rising international visitor numbers to tropical Hainan Island as well.
- All eyes will be on the progress of high-profile, high-speed rail projects across Southeast Asia, notably in Vietnam, Thailand and Indonesia. Overland travel infrastructure is much needed throughout the region, and governments covet the successful network economic effect of national bullet train systems in China and Japan. Keep your eyes peeled also for the publication of a feasibility study for a Trans-Borneo high-speed railway that could connect Malaysia, Indonesia and Brunei on the island of Borneo. This would be a transformational project for those three travel economies.
Stan Pawlow, data analyst
- In 2026, pricing in travel will move beyond traditional dynamic models toward real-time contextual pricing, where algorithms respond to micro-signals like sudden weather changes, local event sentiment and even viral social trends. This evolution is powered by AI systems capable of ingesting and interpreting vast streams of data in milliseconds, adjusting fares dynamically to reflect not just demand but the broader context influencing traveler intent.
- Looking ahead, the competitive edge will come from streaming analytics pipelines and graph-based models (built and powered by AI) capable of filtering meaningful signals from noise at scale. For travel brands, mastering contextual pricing isn’t just about revenue optimization—it’s about creating a pricing experience that feels intuitive, personalized and responsive to the world as it happens.
Madeline List, manager, research and special projects
- As Americans continue to struggle with tightening purse strings and macroeconomic constraints, we’ll see more travelers pooling points and even gaming their loyalty programs and credit cards to be able to afford their leisure travel. While some travelers may hesitate to leave home altogether or prioritize their everyday expenses over their holidays, we are also going to see a contingent of travelers get even more creative with manipulating points and miles to their favor.
Lorraine Sileo, senior analyst and founder of Phocuswright Research
- I think the industry is ready to move on from speculating what AI can do (e.g., agentic booking, seamless travel) to learning and recording actual results. There will be some experiments that simply fail because the market isn’t ready, and some surprises, as AI gets tested and evaluated. There will be less talk of AI replacing everything and more discussion about partnerships and integrations that combine legacy systems (which still dominate) with AI-first platforms. Cooperation will be key to success, as no one brand will be able to provide a complete end to end solution (and consumers don’t want that either).
- Travel booking will become more fragmented as private label and non-travel services evolve (e.g., Chase Travel, Revolut, Capital One) as well as booking on ChatGPT or through social media. New sub brands for booking will evolve depending on preferred loyalty programs, card usage and payment options on a global level.