Five trends to watch in online travel space

by Yeoh Siew Hoon

A couple of key learning points I picked up at the Amadeus Horizons 2008 conference held in Bangkok on travel distribution.

1. It’s about servicing, not selling online

John Lonergan, general manager-direct channels of Qantas, said that online had become more about servicing than selling for his airline. He said there were hidden costs in the online channel and the biggest single cost of sale on Qantas.com.au was call centre charges.

“It is better for us not to sell online but to service online.”

What’s working in the online channel? Loyalty programmes. Up to 80% of redemptions are booked online, said Lonergan.

“Servicing online is not about reducing costs – it’s about the right content to the right customer at the right time.”

In the end, he said, “Some will book direct, all will fly.”

2. It’s about being personal, and being everywhere

Last year, BA generated 1.5 billion Euros in direct revenues from its website. Up to 38% of passengers in the UK book online, compared with 27% of passengers globally.

Carsten Willert, general manager, E-Commerce, BA, said its Executive Club had become a 100% online programme – a one-stop shop for selling, servicing and loyalty.

Features BA is working on – personalization, dynamic packaging – allowing BA to earn ancillary revenues (there’s that word again) and customers to book non-airline products, enhanced redemption capability.

And ba.com, he said, wants to be everywhere – gadgets, mobile, the works.

3. Low cost may be here in Asia but Asians still want some level of service

Ed Nicol, chief information officer of Cathay Pacific, believes that Asian consumers are less tolerant of poor quality and bad service than their Western counterparts.

“The trend towards self-service will not go as far as it has in the Europe and US,” he said.

And in future, he said, we will see the full suite of aviation services being made available in Asia – from aircraft manufacturing to services to technology.

4. From fees to ads

Online Travel Agencies are trying out new models of partnership – Expedia has signed a hybrid model agreement with InterContinental Hotels that is as much about transaction fees as media space.

Cyril Ranque, vice president, Asia Pacific, Partner Service Group, Expedia said, “It’s a good trend for the future.”

5. Metasearch beyond price

Bezurk is working on search features that will allow customers to choose features beyond price – for eg, by types of hotels, said CEO Martin Symes.

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