News for the Hospitality Executive |
The Seven Disciplines
the Travel Industry Needs to
Master in Order to Grow in 2011
By Tim Gunstone, Managing
Director,
EyeforTravel January 2011 Alongside the continuing fluctuating economic
situation, soaring food and commodity prices and potential climatic
disruption,
the travel industry has to master 7 distinct developing disciplines and
trends if
we want to evolve. 1
Search
- Despite Microsoft’s best efforts, Google’s monopoly of this space
seems
certain. However, our research show that more and more travel companies
are
finding their SEO efforts no longer reap reward, and its only PPC that
gets them
up the rankings. Finding a way to make Google communicate why this is
could be
key. In addition we can’t ignore the ITA / Google deal (which may allow
product
prices to appear in search) and wonder how the deal will impact on
established
comparison sites such as Kayak and Skyscanner. Of course innovations
from these
sites will happen, but let’s find out
how and when! In the meantime search is evolving at an incredible rate.
How you
master maps, and location based services are critical elements for
new-age
selling. Similarly, it’s important to understand that if you are
targeting the
growth BRIC markets you can’t rely just on Google and English. This
year
we have the following search sites speaking at our European Travel
Distribution
Summit (May 10-11 in London) – Google, Bing, Skyscanner, Kayak,
Swoodoo,
Travelsupermarket.com 2
Social
Media -
Whilst
search is key, it is a select number of social media sites that are
gaining
huge internet market share and SEO ranking. Facebook regularly attracts
more
traffic than Google and is now providing a genuine threat to Google’s
revenue
stream. What’s really interesting is that
early stages of research indicate that the travel industry finds that
Facebook
is easier to work with as an advertiser than Google. Undoubtedly in a
year of seemingly
constant travel crisis, social media has proved itself as the
way to communicate with customers. However, does this mean that
social media sites will cash-in on even more of our industry’s
marketing spend?
Our research indicates that these sites could be the place where more
and more
travel companies advertise their products, right at the key moment when
so many
travel plans are initiated by our potential consumers. One of the main
reasons behind
this school of thought is that sites like Facebook and Twitter are the
starting
place for many-a-conversation about holidays and travel. The growth and
development of location enabled social networks such as Foursquare,
Gowalla and
Facebook Places also offer a unique potential to up-sell and target
more customers
whilst they are on their trip. This year
we have the following social media sites speaking at our European
Travel
Distribution Summit (May 10-11 in London) Facebook, Foursquare, Yelp,
Gowalla, MagicSeaweed, Trip Advisor, SCVNGR 3
Mobile
- The one stat that really stood out for me from our 2010 events and
research
was the 300% growth in mobile traffic
in 2010 for the lastminute.com site. When you couple this with Hilton
in 2009
reporting a 40 to 1 ROI ration from mobile initiatives you know the
travel
industry is on the brink of a massive change. The critical travel
industry
challenge is to build a business model that enables travel providers to
make
money from their key role in the travel buying cycle. In
order to successfully move (for example) the
complex Ryanair ancillary revenue focused website onto an easy mobile
platform
is no easy feat, but it’s a change which must
be made to succeed in modern travel. The potential for tour operators
and
hotels in this space is incredible! At the moment however, the industry
is still
battling with whether to prioritize apps or mobile sites as their first
move,
not to mention juggling how to successfully take mobile payment, plus
how to
maximise the potential of HTML5. Watch this space! We have Lastminute, Trainline,Virgin,
Ebookers, Expedia’s Mobilizy, Accor
Hotels, TUI UK, Cornthia Hotels
and British Airways all commenting on this
fascinating trend in London this May. 4 Ancillary Revenues & Merchandising.
–
Over the last decade the
drive to build ancillary revenues revolutionised the online travel
industry. It
will continue to do so but there is a huge flaw that no one seems to be
willing
to address. Mobile browsing will only keep growing yet it still remains
impossible
to buy an air ticket from an ancillary-heavy website on an iphone. The
consumer
trend is still to browse a little on your mobile, check out the
options, but wait
until you are back at your desk where you can adequately search for
cheaper
products and ultimately purchase travel. It’s only at this point where
the
customer often changes supplier. I see more and more travel companies
selling
non-core products through more channels but also the innovators facing
a huge
challenge if they remain tied to the point of sale revenue generating
machines. This year
we have the following companies speaking about ancillary in London this
May: Spanair,
Hostelworld, Farelogix, Cartrawler and
ATPCO 5 Payments and Fraud. The
growth of the online travel industry across different markets follows 2
simple
stats. Internet penetration and online payment. In 2010 67% of
Europeans couldn’t
pay for your product online via cc. We examine how your payment
capabilities
need to match your product and target market. We also look at the ever
present
threat of fraud and how you can minimise this risk. 6
Revenue
Management – it’s the dark art
that’s been around for
years, get it right and you can explode your profit margin. Get it
wrong, and
you lose customers for good and create internal chaos. The ever growing
number
of channels and balancing distribution innovation with what works is
also key.
How do we move forward with RM, and what are the key industry issues?
Certainly
how to sell in-hotel and on-flight, plus how to implement RM on a
budget or for
an independent hotel. We have
the following companies speaking about revenue management at our London
show
this 10-11 May: NH
Hoteles, IHG,
Hertz, Colorline Cruises, Ramada Jarvis Hotels 7
Distribution sales & marketing strategies: partnerships – In
our business partnerships and relationships between the intermediaries
and the suppliers
are an ever topsy turvy seesaw. Right now with various GDS battles
raging, plus
new channels such as group buying on the up- distribution has never
been so
hard. Innovation and development with partner companies is the only way
to
guarantee your hold on the market. This year
we have the following companies speaking about Distribution marketing
strategies and partnerships at TDS Europe: Accor, Ryanair, BMI, BMI
Baby, Avis, Citizen M Hotels, TUI, Gap Adventures,
Visit Britain, Choice Hotels, Royal Caribbean, Black Tomato, Eurosstar,
Eurorail,
@leisure group, Expedia So, to conclude,
these issues are based on the
countless research calls and emails we make each year to key decision
makers in
the travel industry to formulate the
agendas for our Travel Distribution Summits. I
founded the Travel Distribution Summit in 1997 and it has been leading
innovation in the online travel industry ever since. Every year we
spend months
not only researching what the industry wants to know about, but also
identifying what the industry needs to know to move forwards.
The results
come together this May when over 90 speakers and 1000 attendees (all
senior
decision makers from all parts of the industry) meet to network and
form
strategies that will see travel companies reallocate millions of
marketing and
distribution budgets in order to simply sell more travel and reduce
distribution
cost. Hope you can join us. www.eyefortravel.com/tds About EyeforTravel EyeforTravel is a leading media company specializing in business intelligence for the travel and tourism industry. EyeforTravel provides a series of senior executive travel conference on a diverse range of topics including travel distribution, online marketing, social media, mobile and revenue management. EyeforTravel also provides some of the most in depth research into global online travel markets and trends. For more information visit www.eyefortravel.com |
Contact: Rosie Akenhead Event Director [email protected] 0044 (0) 207 375 7229 |