Travel technology Mobile, merchandising and more
and its own price comparison. In the same way, hoteliers are looking to add revenue streams beyond the room, both on and off property, as they seek to drive up customer loyalty and rein back on distribution costs through the major online intermediaries. Online agents have long since offered flight-plus-hotel searches, sales of which may now be classified as ‘Flight-Plus’ packages in the UK for regulatory purposes although in essence they remain component sales made concurrently. But the trend is towards trusted travel brands offering customers a much more all-encompassing service, catering to a consumer’s every need before, during and after a trip. TripAdvisor’s $200 million buyout of trip-experience site Viator in July signalled the review giant’s move to add tours and excursions to the hotels, restaurants, cafes and other attractions it features. This followed the purchase of French online restaurant-booking platform La Fourchette for an undisclosed sum in May. Priceline, parent of
Booking.com, reacted the following month by spending an eye-watering $2.6 billion on rival restaurant booking site OpenTable. Peer-to-peer pioneer Airbnb will not limit its expansion plans to a move from spare rooms to more mainstream hotel accommodation. It has already signalled its intention to break into the tours and activities market.
Upwardly mobile As well as user demand for full-service travel providers, what is driving this move is mobile. Skyscanner, now a metasearch site for hotels and car hire as well as flights, sees mobile technology spawning the emergence of the ‘always with you’ electronic travel buddy. Filip Filipov, Skyscanner head of business
to business, believes these ‘buddies’ will exist inside a watch, a piece of jewellery or some other form of wearable technology, as well as via apps on smartphones. “These
are different tools that are not necessarily to interact with a travel agent or website, but something that understands us, knows our background and what we have done before in travel,” he suggests. Filipov argues artificial intelligence will increasingly allow travel firms to anticipate customer needs in a more sophisticated and personal way and to react on-demand. It is this that prompted deals publisher
METHOD OF BOOKING NEXT OVERSEAS HOLIDAY
METHOD OF BOOKING NEXT OVERSEAS HOLIDAY
Other/don’t know 3%
the phone 9%
Over
Online using mobile device 7%
face in travel agency 13%
Online using desktop/laptop 68%
Face to
Travelzoo to launch a hotel booking engine this year, initially in the US and now in the UK, acknowledging that customers alerted to deals on their phones expect to be able to book them there and then. The challenge for the big online players looking to operate at enormous scale is to ensure they are selected by a sufficient number of customers as the first travel app users turn to for information, advice and travel products. The gathering momentum online %
Source: TNS (October 2014) Base: 851 UK adults likely to take an overseas holiday
MAIN DEVICE FOR CONNECTING TO INTERNET
MAIN DEVICE FOR CONNECTING TO INTERNET
Other 2%
Tablet 15%
Smartphone 23%
Laptop 40%
Desktop 20%
Source: Ofcom (2014) Base: 2,976 UK internet users aged 16+
and the coalescing of component travel products may not indicate a return to what is traditionally understood as a package holiday. Products will be more fluid, more dynamically created and their component parts more loosely connected in terms of commercial agreements between suppliers and retailers. Such holidays might well be capable of avoiding the regulators’ reach, depending in part on how and when they are booked and on the final form of the revised Package Travel Directive currently undergoing redrafting in Europe. But a holiday has always been a set
100
20 40 60 80
0 All 16-34 35-54 55+ Source: TNS (October 2014) AB C1 C2DE Child Base: 851 UK adults likely to book an overseas holiday child No N Midlands South orth 75% 68% 82% 79% 72% 71% 64%61% 77% 70% 79% 73% 71% 62% 78% 77% 67% 69% 70% 61% 7% 10% 8% 3% 7% 6% 9% 11% 8%
ONLINE BOOKING: BY AGE, SOCIAL CLASS
Online Desktop/laptop Smartphone/tablet
75% 68% 80% 73%
9%
7% 7%
of discrete ingredients brought together to form a single product, with each component’s value to the customer dependent on the other. Traditional package operators have long understood the technical complexity behind this, along with their duty to take responsibility for its delivery. As technology simplifies the creation of modern types of packages and lowers barriers to entry, the question is will consumers be offered the same level of assurance?
52 | Travel Weekly Insight Annual Report 2014
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