Long-standing leaders in the travel industry are no strangers to disruption. The wave of online travel agencies (OTAs) first formed in the late 1990s and incumbent brands have been fighting against the rising tide ever since.
While OTAs like Priceline and Expedia were once seen as customer experience innovators and digital leaders, there are new adversaries for all travel brands to be concerned with. Big Tech companies (Google, in particular) bring a new level of disruption to the table and are quickly eating into industry profits.
Adapting to the next wave of digital disruption isn’t just about having a mobile presence. It’s about unifying your products/services and tapping into your secret weapon—customer experience.
Google’s Rise in the Travel Industry
Even though OTAs eat into the profits of incumbents, it’s still a win-win scenario because travel product/service providers can sell off remaining inventory.
As Google finds a stronger foothold in the travel industry, that relationship is flipped. Back in 2011, Google experimented with its Hotel Finder service, which was built on the back of its vast database of consumer search data. Fast forward to 2017 and the hotel service accompanied by a flight product, supported by a partnership with ITA Software.
This partnership ensured that Google would only surface deals from individual hotels and airlines, leaving OTAs out of the mix.
At first glance, this seems like a boon for incumbent travel brands that were once disrupted by OTAs. No more OTA commissions and an easier path to customer discovery.
In 2017, Google Travel earned $14 billion in revenue and achieved a valuation of $100 billion (higher than that of Priceline). Google isn’t quietly taking shares of the travel industry—it’s putting the industry on full blast. And that’s going to cause problems for all kinds of travel brands.
Travel Brands Can’t Keep Conceding User Data
The reason Google was able to enter the travel industry in the first place was that it owns so much data about your customers. While OTAs and incumbent brands fight over keywords through Google’s ad system, the company is able to put together every ounce of information necessary to build a product that serves consumer needs.
That same theme is carrying over to the newest waves of digital transformation, too. Take chatbots, for example. You may be quick to embrace the Facebook Messengers and WhatsApps of the world to get closer to customers—but that’s just building Facebook’s arsenal to capitalize on travel industry opportunities.
No one is saying that competing on Google keywords and having a presence on social platforms like Facebook are bad ideas. You just need a plan for owning your user data and customer experience so you’re the one benefiting from engagement—not big tech companies.
That’s why owned customer experience is the secret weapon of travel brands.
The Customer Experience Chink in Big Tech’s Armor
Companies like Google and Facebook thrive on giving your customers convenient access to what they want/need. Why would consumers click your link when they can purchase a flight right from the Google results page?
Travel planning isn’t all about convenience, though. In fact:
- 94% of leisure travelers switch between multiple devices when planning/booking
- 59% of travelers research their trips between one and three months before departure
- 85% of travelers will make additional travel decisions after arriving at the destination
The reality is that most travel bookings aren’t spur-of-the-moment decisions. There’s a lot of planning that goes into a vacation—which means there are plenty of opportunities for you to impact travelers outside of what someone like Google offers.
When travel brands focus on an end-to-end customer experience, they offer value beyond the convenience of booking flights on a Google results page. Instead, you become a trusted resource for travelers both in the moment and for future planning. You might not maintain control over searches for “hotels in NYC,” but that doesn’t mean you can’t win the long-tail terms and build loyalty through exceptional experiences.
This is why a company like Airbnb doesn’t have to worry about Google or Facebook or Amazon entering the travel industry—because they have a unique, branded customer experience that keeps customers coming back again and again (even before they ever created a formal loyalty program).
There’s no reason why even the most traditional travel brands can’t capitalize on the customer experience opportunity. Instead of racing to the bottom against Big Tech, build customer relationships through:
- End-to-End Personalization: Consumers expect on-demand experiences and travel brands can use technologies like chatbots and messaging to create more of a concierge feel.
- Machine Learning and AI: These aren’t just buzzwords. You have so much data about your customers at your fingertips—use it to fuel personalization efforts and offer experiences travelers will never forget.
- Unified Digital Platforms: Custom development and seamless integration with your portfolio of products and services creates that unified feel across devices and channels for better consumer engagement and data generation that you own 100%.
In recent years, this call to action for travel brands has been fairly common—build your customer relationships, own the experience, and you’ll find success in the midst of disruption. There’s just one nagging problem: how do you do it?
The first step is to figure out exactly what it means to “improve the customer experience.” Check out our free white paper, Solving for CX: 2018 Customer Experience Survey, for all the insights you’ll need.
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