We’re creating a more connected travel industry, underpinned by sustainability and long-term investor relations.
Online travel’s growth seems unstoppable. It is gaining momentum, growing five times faster than offline, with regions like the Asia Pacific outpacing other regions by 25%. However, this fast-paced digital environment has its own challenges. With mounting pressure from travelers, suppliers and new players there is a constant need for online travel companies to reinvent themselves to stay relevant.
Consolidation is on the rise and big online travel agencies (OTAs) have become mega brands. Other OTAs are also diversifying their core businesses beyond airlines, apartments, hotels and vacation rentals, to tours, activities, restaurants, food deliveries and ridesharing. An example of this is with Booking Holdings, TripAdvisor and Expedia each acquiring reservation system companies: FareHarbor, Bokun and HomeAway, respectively.
Innovation continues to spark growth and change across the sector. Online travel players need to respond to these changes and leverage emerging technologies to create personalized moments that matter to the consumer.
That’s where we come in! We are focused on delivering content and technology to support new business models, so online travel players can focus on their customers. Our OTA solutions and dynamic approach to merchandizing and virtual interlining allows online travel companies to offer more choice and flexibility to deliver unique travel experiences.
We’ve identified consumers, competition, content, connectivity and consulting as the key developments that will make the online travel market in APAC an exciting one to watch in the coming years:
Mobile is no longer a platform; it’s a way of life. Younger generations of travelers are accustomed to searching and viewing content on their mobiles first when booking travel. This brings new challenges for online travel companies to create a closed-loop, one-stop shopping platform. And while consumers have more power through direct access to content, they’re now spoiled for choice and express a need for trusted curation of content.
Customer loyalty, acquisition costs and the ability to connect directly with travelers mean greater investment in technology. Fragmentation of content and shrinking airline and hotel margins are adding more pressure on the revenue per transaction. As a result, the competitive landscape is evolving – consolidation is on the rise, big travel agencies are becoming “mega” and small ones are covering niche needs for travelers. Local startups are defeating “the giants” through innovative solutions that focus on localization as well as personalization.
Consumers are flooded with options for just about anything. While this myriad of possibilities provides a huge opportunity for online travel companies, it is also causing content fragmentation. The challenge is how to aggregate and normalize travel content from multiple sources so it can be searched and compared by travel sellers and travelers. We imagine a world where NDC and traditional technology such as EDIFACT will sit alongside each other for many years to come.
While online travel companies have been tiptoeing around personalization for some time, we’ve reached a tipping point where the relationship between the traveler and brand becomes real-time and relevant. The headline makers – AI, machine learning and blockchain – are starting to bear fruit, with experimental upgrades and personalized interactions to unlock new revenue streams in marketing, merchandising and voice search optimization.
Online travel agents get access to thousands of data points, which gives them unique insights on traveling. However, the challenge lies in defining and measuring this data in real time and then getting this data and insight to the front line – on digital channels or to sellers – where it can impact the customer. We’ve seen several successful partnerships between agencies as a way to offer data-driven insights that help travelers know the optimal travel plan for their vacation, places to avoid and the best hotel to stay while on holiday.
For more insights, download our Future of OTA insights here which features views from Amadeus, Tripfez, and Ctrip on what the future of online travel looks like.