City Insider: Taking the travel technology pulse

City Insider: Taking the travel technology pulse

City Insider - FT journalist David Stevenson on the travel industry

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David Stevenson takes stock of the main trends in travel technology picking out a few start-ups that might emerge to threaten the dominance of the big boys as they strive to stay ahead of the game

I have a sneaky suspicion that senior executives at Tui Travel have been paying inordinate attention to Apple’s App store charts in the last few weeks, feverishly scanning the long list of top travel apps in search of a new product with a name that just so happens to begin with the letter T.

Its recently launched (back in May) MyThomson app is something of a first – a proper attempt by a major travel group to provide an end-to-end, digital customer support service. Or as a certain Peter Long puts it, a first stab at what could look like a ‘digital concierge’ or assistant.

According to my colleagues over Travolution, “the firm saw 15,000 holidaymakers download the app during a trial period and it secured a four star rating on Apple’s App Store and a place in the top 20 travel apps”.

Thomson say the app is a “one stop shop” for everything from destination guides and weather through to customer travel details.

Lurking beneath this product launch – publicised by an extensive and expensive national newspaper ads campaign – is of course a much more powerful industry-wide driver, to get technology harnessed to personalising the customer experience, rather than confusing the hell out of the customer with too much choice.

A recent ViewPoint video interview with Long gives us a much clearer take on the Tui technology strategy – Long suggests that “our relationship with our customers is mobile driven” and that “our plan is to enhance and enrich the Digital Assistant so the product is more like a concierge service, helping not just on the holiday you’ve booked but also advising on your next holiday destination… it’s all part of Tui Travel’s differentiated holiday experience.”

And that technology is also likely to have a fairly immediate impact on the branch network, with Thomson’s first next-generation shop opening late in the summer; these will feature a “giant immersive video wall (2m x 3m) to showcase new video content”, an “interactive map and interactive table [which] will entertain customers and help them research holidays” and “high definition screens and booth projections around the store [which] will feature changing images and videos to inspire customers and give them a feel of what to expect from their holidays before they book”.

Tui isn’t, of course, the only travel player busy technologically innovating like crazy – easyJet has just announced that it is increasing the scope of its mobile check-in and boarding pass reader from an initial six airports to 38, and I suspect that Thomas Cook’s newly recruited digital team is also busy at work scheming new products to challenge Tui. Given this hectic market activity, it’s thus an ideal time to take stock of key digital travel trends.

The big trend that everyone wanted to see take off in 2013 was Big Data – using the vast silos full of digital travel data , turning that information into usable, revenue-inducing propositions. The promise, of course, is huge (the sector has no shortage of rich data points on its customers) with the ability to use data mining technology to provide a proper, personalised experience, where predictive technology can sensibly offer up bespoke advice about your next holiday destination – or that at least is the masterplan lurking in the back ground behind Tui’s plan for its digital assistant technology.

But a recently released report from Amadeus reminds us that getting Big Data to work in travel is proving a tad trickier than we all expected. The key challenge is that it is labour intensive – paradoxically crunching all that data and then making the necessary heuristic linkages requires very specialist professionals who usually don’t hail from a typical IT background.

Maybe they should just recruit a couple of experienced high street travel agents, who also happen to know a thing or two about technology.

According to the experts, smart Big Data analysts can see beyond the transactionally-driven IT silos and start to bring insight into how to pull together social media data, for instance, into systems primarily designed to crunch customer payment details. The Amadeus report also reminds that much of the software used by Big Data experts requires specialist predictive analytics and open source software platforms that sit uncomfortably within traditional enterprise-driven legacy software systems.

Given these constraints, it’s unsurprising that much of the innovation is being done by innovative start ups like Hopper, a fairly elusive North American outfit that has been quietly beavering away on an allegedly groundbreaking technology platform that will look to integrate various online travel databases into a more “structured experience”.

According to a recent interview with its founders, this start-up has already “aggregated half a billion webpages” in the travel vertical and is still far from ready to hit the market.

Big Data will make a huge impact in the travel sector but I’d suggest that we’re not likely to see the first fruitful take on proper personalisation using data mining techniques for at least another year or two. In the absence of Big Data providing the excitement, many commentators (myself included last year) would have suggested a renewed focus on social media, but I now have my doubts.

The slow but steady pushback against social networks is gaining traction and barely a day goes by without someone in their twenties quietly muttering to this disinterested observer that they’re beginning to limit the information they share with Facebook. Crucially I’d suggest that many in the millennial generation are treating social recommendations with some caution.

Personally I’d be looking at two other more short-term trends to make the running, both focused on the internet browsing experience. The most immediate centres on the curation of existing content followed by a no-less-important focus on filtering techniques that allow a website to present all the available information in a simple to understand layout that the user can easily navigate around.

In the curation end of the spectrum of new services, the key business driver is that the internet is an enormously confusing place, with far too much information and too much noise. Cue outfits such as Triptuner, Tripomatic, and especially do a brilliant job of pulling together lots of varying online content into simple guides that allow the user to properly research their next holiday experience. These newbies are also making huge progress in decision tree-based products that let the customer properly zero in on exactly what it is that they want from a new product.

In terms of using technology and especially ‘design’ to filter down the mass of content into a simple customer UX experience, it’s worth looking closely at the excellent Skypicker site for its airfares and more generally outfits like Superfly and Hipmunk.

I’d also keep a beady eye on two other slightly more familiar ideas – flash sales and speedy search. The idea of properly-curated flash or private sales isn’t exactly news for the travel sector, but we are seeing a renewed focus by a number of interesting newish outfits who are making a great deal of noise.

Jetsetter for instance was recently snapped up by TripAdvisor and turned into its exclusive private sales offering (thereby killing of the SniqueAway platform), while HotelTonight continues its remorseless rise to global dominance. This mobile-based same day hotel booking model has now expanded into 12 countries and has raised over $35 million to continue with its global push.

A few insider tips from a recent HotelTonight survey of customer data:

  • Sundays, on average this summer, will be the most inexpensive days to book last-minute stays.
  • Spontaneous travel is increasingly popular — 35% of respondents will start their summer travel planning only a week or so in advance, while more than 20% plan to decide where to go and what to do the day they leave.
  • 62% of respondents said that they were “much more likely” to use a mobile device (smartphone or tablet) to book summer travel this year, compared to last.”

Simplified or speedy search is also figuring heavily in much of the venture capital and M&A activity in the digital travel space – Expedia for instance is beta testing a semantic search engine called YourVisit while CheapAir is also beta testing “Easy Search” for semantic searches of flights.


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