Wish you were elsewhere

OFF ON your holidays? The Easter weekend break sees the single largest holiday exodus of holiday-makers, larger even than on any summer weekend. But though it may not feel like that if you are struggling through an airport or stuck in a motorway jam, there is a quiet revolution taking place that will transform the holiday industry over the next generation in the way that the mass package has changed the industry over the past one.

The revolution has three parts. There has, for several years, been a sea change taking place in the demand for holidays, a change that has been met to some extent by changes in the supply. Now, most important of all, there is a change in the way in which suppliers can reach potential holiday-makers.

The change in demand is well-known. As the balance of the population, not just of Britain, but of all developed countries, gets older, the sort of holidays people take will change. In fact, it is already happening. The holiday market is becoming much more segmented - the family holiday remains, of course, but the growth will be in holidays for the retired, and for single people.

Parallel to this change in demography is a change in taste. Holidays are becoming more specialised, and increasingly carry with them some kind of educational or cultural experience. People go on holiday to learn something. That may be an activity such as skiing, but it may also be a skill: a foreign language, for example.

For some people, a holiday, instead of being a form of consumption, is becoming investment - investment in their human capital. As learning increasingly becomes a lifelong process, expect the barrier between leisure and education to blur to such an extent that it virtually disappears.

Unsurprisingly, the market has tried to meet these needs, but it has had some difficulty in doing so. During the past 30 years, the holiday industry has become terribly good at exploiting economies of scale, by applying mass-production manufacturing techniques to a service industry: ever cheaper flights, lower-cost destinations. It has not been so good at fashioning holidays to specialist needs. Sure, there are specialist holiday companies and there is a handful of upmarket operators that create custom holidays. And there are companies like Saga, which have ridden on the growing market for mature citizens.

But the industry has not found it easy to create what manufacturers would call mass-customisation. As people develop more precise and specific needs, it becomes harder to match the product to the person. Besides, people do not necessarily know what they want. If it is hard to develop a holiday product for a demanding, specialised audience, it is harder still to create one for a specialised audience that does not know quite what it wants to demand.

Enter the information revolution. The Internet remains a crude and often frustrating tool, but it is already revolutionising many industries: bookselling, for example, and, in the US, stock-market trading. Now it is starting to revolutionise the holiday business too.

The most obvious example of this is the online auctions for cheap airline seats. Because the airline seat loses all its value if it is unsold the moment the plane takes off, it is particularly suited to the auction. The Internet is a technology that makes a radical improvement in information, bringing together buyer and seller, and so makes for greater efficiency in the use of a perishable product such as an airline seat.

But I don't think that is the main way in which the Internet, or whatever the Internet develops into, will change the tourism business. Online ticket sales are just one more way of making travel more efficient, like larger planes. The product is homogenised, so the buyer knows exactly what he or she will get. The main way in which the Internet will change things is quite different, for it will enable the whole industry to become much more specialised - thereby fitting in with the changes, noted above, that are taking place in demand and supply.

The more specialised the demand, the harder it is to find what you want. Regular brochures, even from specialised operators, are still offering a mass-market product. What the Internet does is to make available the great global library of information, not just offering a holiday on this or that date at this or that price, but giving people knowledge to enable them to develop their own ideas about the way they would like to use their leisure.

At one level, the Internet is just one more way in which established companies will sell themselves, and that is fine. The paper brochure is an inefficient and inflexible way of explaining the product, and anything that enables people more effectively to find out what they want is wonderful.

But this is to think of the new technology as a simple extension of the present one, whereas it gives the opportunity of radical change. Suppose you have a special interest, or would like to spend some holiday time developing one. You can find out a lot about the subject from the Internet - who the experts are, what the experiences are of other people in similar positions, how a mixture of home courses and weekends away might be mixed in with the holiday experience.

Now look at it from the point of view of the provider. We tend to think of the holiday company as the provider. But while some companies do provide the holiday, most rely on large numbers of subcontractors to do the work. The subcontractors produce to the specifications of the company that is marketing them. But now organisations that have not thought of themselves in the holiday business, but which have a product to offer, can market directly.

Think of universities, which have both the skills and the accommodation available in the holiday period, but which now offer these in the rather formal summer course framework. Think of small hotels, which up to now have had to use indirect marketing through agents. Think of parts of this country that have a lot to offer (and attract a lot of foreign visitors) but which are neglected by Britons. Think of the way in which niche suppliers can get feedback, and create something of a global club of customers. Think of the way in which people's worries about what is, after all, a large purchase can be assuaged - by putting them in touch with other purchasers.

The key point here is that suppliers can reach their market - and that market may be anywhere in the world - much more efficiently than they could before. As the Internet itself develops, and its search facilities become more sophisticated, people will get more help in finding what they want, producers will be able to create precisely the product desired, and each will be able to reach all the others.

Of course, not everyone will want to buy or create his own specialised holiday package. The mass market will continue, but it will tend to shrink in relative terms. The significance of the new information technologies is that they reinforce the trend towards specialisation that is already taking place.

Ultimately, I think, we will no longer make as hard a distinction between holiday and work as we do now. True, there will be some activities for which we get paid - we shall have to go on earning a living somehow. And there will be others where we get away from it all, and pay to do so.

But for many people the distinction between work, leisure, education and family life will become so blurred that it will be quite hard to know whether a particular holiday is leisure or education. And the technology has become available to make this happen much more easily.

None of this will necessarily make the physical business of getting around any easier. Like everyone else, I shall be struggling through Gatwick Airport at the weekend. But I will be doing it to get a form of education - in fact, a scuba-diving certificate - and I did find the information on where to go on the Internet.