A white paper on travel technology trends - Online Travel 2020: Evolve, Expand or Expire – released by Amadeus, world’s leading travel technology provider for the travel sector, recently cautioned Online Travel Companies against ‘Black Swans’ who could disrupt the industry with innovative “consumer facing” technology in coming years. New trends are emerging in the online travel space and online travel companies have to adapt their products and business models based on anticipated changes and potential disruptions of the ecosystem, the white paper says.
Revealing the white paper, Sebastien Gibergues, Head of Leisure & Online Travel, Amadeus IT Group said that “a brave new world” is emerging fast and a lot of disruptions are bound to happen in the online travel space between now and year 2020. Online Travel volume which was US$8.9 billion in 2015 is expected to nearly double to touch US$17.3 billion in 2020 in India. Out of the total online travel business, almost 50% is expected to happen through mobile in 2020, he said. Therefore, it is quite critical online travel companies to polish their consumer facing technology more robust and efficient.
Amadeus white paper has identified evolution of four different scenarios that can unfold and play out any geography in the world. These scenarios are the rise of Mega Online Travel Retailiers, Traditional tour operators transforming themselves into Digital Tour Operators, the rise of more sophisticated Mobile Travel Retailers, and emergence of new Travel Marketplace by e-commerce giants.
Explaining the emergence of Mega Online Travel Retailers, Gibergues said that it is like a Super Market model where consumers come, browse, compare product offerings, find the right product, buy and walk out of the store. However, with the consolidation and convergence of OTAs and Meta Search Engines, there will be a shift happening so that focus would not be on selling alone but “monetizing” every component consumer journey. While metasearch companies move on to assisted booking, OTAs are now advertising to customers to increase revenues, and these huge entities allow customers to search, book, and pay all in one place to become an Online Travel Retailer.
The Amadeus white paper also foresees conventional tour operators transforming themselves into ‘Digital Tour Operators’ combining their key assets and expertise with the support of technology. “They are already good at physical aspects, they just have to adopt digital aspect to reclaim the lost space in the travel market,” Gibergues said. The study predicts a scenario of Traditional Tour Operators and OTAs merging to become the ultimate travel seller. From handling complex trips to servicing with new generation travel stores, Digital Travel Operators could provide a happy mix of digital and human interaction to create a personalised travel experience.
The white paper also expects emergence of Mobile Travel Retailer with a ‘Mobile Only’ strategy to capture the mobile savvy consumers in the market. Scope for a new player to come and disrupt the mobile only space offering a totally curated travel browsing experience is very high, Gibergues said.
The White paper also foresee emergence of new Travel Marketplace driven by existing e-commerce players who have a wealth of user base across segments. Their power to innovate faster than any online retailer is quite big, he said citing examples of Alibaba in China and Paytm in India. With more and more leading IT players and e-commerce giants creating demand for new and innovative platforms, the players of the travel industry could come together and build their own Travel Marketplace platform for OTAs, airlines, hotels, and other travel-related companies to sell their products and services.
As a B2B technology company, Amadeus will continue to watch the unfolding online travel scenario and play and enabler’s role to help its industry customers “transform themselves as one of the industry leading online player,” he said. “Our message to the trade is fairly simple. They have to focus their investments on consumer facing channels. Behind the scene, as a B2B company we will continue to invest in building the core component to enable trade in the new business model. We believe that some of these components can be build as shared component or Cloud service, then our consumers can build their value propositions on top of it,” Gibergues stated.