This experience hasn’t happened magically. It was by having a clear vision and consistently investing in the right technology, processes and people. Amazon aloneinvested circa $75B in technology in 2023. At Amadeus, we are proud to be the travel industry’s top R&D investor; last year investing €1.1B, or roughly 20% of our company’s revenues.
But who needs this ‘one-click travel’ aka ‘travel made easy’ anyway?
The travel industry as a collective need to offer a similarly impressive customer experience, now more than ever before. A few years ago, business travelers drove most of the industry’s profitability. Twenty percent of passengers at the front of the plane defined the success of many airlines. This is still the case, but the composition of the twenty percent has changed.
Today, the front of the plane increasingly is made up of leisure travelers that are willing to spend on bucket-list trips and memorable experiences. A quick glance at the top outbound destinations from the UK exemplifies this trend. Dubai is now the top outbound destination from the UK with Mauritius and the Maldives both entering the top ten. In 2019, neither of these luxury island retreats were even in the top 20. Traditional business destinations like Amsterdam, Frankfurt and Madrid have all dropped out of the top 20.
This helps explain why carriers like Qatar Airways are re-investing in their first class and business class offerings; and across the industry, airlines are quietly rebranding to better attract these premium demand potential customers. Of course, business travel continues, indeed it’sbouncing back. The change that cannot be ignored is the drastic and sustained increase in premium leisure travel demand.
How should travel compete with premium car brands like Tesla or luxury fashion houses like Prada?
This might sound like an odd question but it’s one being discussed in travel company boardrooms around the world. If the game is encouraging affluent customers to increasingly and consistently choose luxury travel, then such travel increasingly competes for share of wallet with automotive, fashion and luxury brands. Should we take that five-star city break? Upgrade to the latest model Tesla has to offer? Or buy the latest ‘it’ handbag? Realistically, these consumers will only spend more on premium travel if they know they will get a premium customer experience.
Travel is still a customer experience laggard
Amazon delivers a great customer experience. In part, it’s been able to achieve that because the company owns the entire value-chain from its website to logistics: one company orchestrates the process. Travel is significantly more complex.
An end-to-end trip typically involves a travel agent, ground transport, an airline (or several), an airport (or several), more than one border agency, a hotel and activities and experiences in the destination. Each trip contributor cannot define and deliver an end-to-end experience; an experience delighting travelers convincing them to take their next luxury trip instead of getting that new Prada handbag or Patek Philippe watch. This opportunity and responsibility is shared by everyone. That’s why Amadeus advocates for industry collaboration, common and coordinated investment in technology and a strategic approach totackling customer experience pain-points in travel.
In some parts of the world we’re seeing this type of coordinated action. Saudi Arabia, Singapore and the UAE are examples of destinations where there is government facilitated collaboration between airlines, airports, and border control. These destinations are typically rising in popularity and are investing in cultural and leisure attractions, for example, you can now visit the Louvre in Abu Dhabi or the Museum of the Future in Dubai. Imagine getting those ticket by the click of a button…
They are also ambitious in their pursuit of frictionless travel, enabled by digital identity, biometrics and other innovations. Many traditional destinations, and the travel companies that serve them will observe these developments with interest. With time, we will work to bring key stakeholders together in pursuit of better journeys.
How can we achieve ‘one-click travel’?
The customer experience pain points in travel are shared amongst different organizations. Solving them is both a shared opportunity and a shared responsibility, so the place to begin is an honest and open discussion to reach consensus that we’re going to work together to systematically address these pain points.
At Amadeus we are bringing our deep expertise to this challenge and working with our customers and partners to scale the new ideas that will help to deliver one click travel. Digital identity is a good example. We’ve worked with more than 20 airlines to help them digitalize document checks for passports, ID cards and health records. The traveler’s documents are verified before they reach the airport, drastically simplifying the passenger’s experience.
Digital identity is one example of an infrastructure challenge we face in the travel sector, but there are many similar problems that require a collaborative approach. That’s why our industry needs to adopt an ecosystem approach that breaks down the silos that stand in the way of progress, using an open mindset and open technology foundation.
Supporting airlines to become digital retailers
An ecosystem ethos encompasses our business strategy, product development and our partnership approach. Take Amadeus Nevio, our new modular offering for our airline customers, allowing them to become modern retailers.
Nevio is based on the latest technology that allows airlines to deliver a more traveler-centric experience across the entire trip. This means being recognized when you shop for an experience, increased self-service options, and responsive re-accommodation during disruption.
Airlines are transitioning from a system of schedules, seat availability, and pricing to a more personalized approach, where they provide a quote or an "Offer" tailored to the customer's needs. This Offer can include not only traditional flight-related services like seats and meals, but also services from third-party partners such as hotels, transportation, and entertainment. If the traveler accepts the Offer, the airline will create an "Order" to replace traditional booking and ticketing systems like the PNR.
This new process is expected to enhance productivity, improve customer experiences, and potentially increase profits by selling a broader range of services and employing dynamic pricing strategies.
The ecosystem approach is fundamental to achieve this ambition. Amadeus Nevio allows airlines to connect more easily, build faster, and operate smarter within their ecosystems.
Collaboration with various partners, such as Adobe or hotel providers, are part of Amadeus' strategy to provide a foundation for airlines to enhance their connections within their ecosystems and offer the retail experiences that travelers seek.
Collaborative airport operations
The benefits of collaboration in travel extend beyond obvious customer experience examples. Delivering smooth operations at the airport involves hundreds of different contributors working closely together to ensure flights depart on time and travelers enjoy a rewarding experience. Especially during times of disruption, when unexpected events, such as bad weather, medical emergencies, threats etc. can trigger an immediate reaction or need for change, and airports must react quickly to reallocate resources like stands and gates.
That’s why we’ve invested in developing ourVirtual Airport Operations Centre as an app for Microsoft Teams, bringing involved parties together to better manage day-to-day operations around a single plan that can super-charge collaboration and improve decision-making at the airport.
Our ambition
You may have noticed that Amadeus is partnering at scale, acquiring companies and releasing new products more quickly than ever before. We have recently acquired Voxel, a leading provider of electronic invoice and B2B payment solutions for travel sellers, hotels, and other travel players; earlier this year we completed theacquisition of Vision-Box, a leading provider of biometric solutions for airports, airlines and border control customers. We’re progressively opening our technology stack to facilitate easier technical connection and business collaboration. That’s because we understand the travel industry is digitally transforming and there’s a real opportunity to improve the experience of travel.
Whether through our distribution business that provides the broadest range of travel content combined with market-leading technology delivering New Distribution Capability (NDC) or our Cytric Easy innovation that makes it possible for business travelers to plan collaborately and book natively within Microsoft productivity tools, or our payments business (Outpayce) that provides a single platform to accept payment across the entire traveler journey. Amadeus is investing in technology helping our customers deliver a better experience for the traveler.
Our Travel Technology Investment Trends study suggests the industry is ready to embrace this change, with the average travel company planning to increase investment in technology by 14% this year. To maximize the impact of this investment we need to advance together using open technology, enabling true orchestration through the travel ecosystem delivering this seamless end-to-end journey throughout the traveler’s entire journey. In my opinion, that’s how we can achieve a frictionless one-click travel experience that ‘grows the pie’ for everyone, and makes the experience of travel better than anyone thought possible.
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