Competition in the travel industry is high, and margins are low. It’s clear that online travel agencies (OTAs) can’t do business in the way they used to. And with the cost of travel continuously being driven down by low cost carriers, discounting and disruptive competitors such as Airbnb, OTAs need to be adaptable and agile to remain at the top of their game.
Once upon a time, around two decades ago, you had to seek the services of a local travel agent to research and book a trip. Nowadays, travellers have many options available to them to help choose destinations, compare prices and make reservations independently and easily. They are also investing a significant amount of time planning travel, via both online and offline channels, in the weeks leading up to a purchase.
Competition in the travel industry is high, and margins are low. It’s clear that online travel agencies (OTAs) can’t do business in the way they used to. And with the cost of travel continuously being driven down by low cost carriers, discounting and disruptive competitors such as Airbnb, OTAs need to be adaptable and agile to remain at the top of their game.
What’s interesting is that price isn’t always king in consumer purchasing decisions. In fact, customer experience is the true differentiator. And the winners are those that are able to create, personalise and guide a traveller’s journey – providing a high-quality customer experience throughout.
The array of holiday add-ons now available, such as holiday excursions and car rental, means that OTAs can effectively stay close to the customer throughout the whole journey and reap the financial rewards as a result. In the future, the big players might even allow travellers to order room service through their app or website while sitting in their hotel room.
Suddenly, the OTA interaction isn’t simply a one-time transaction, it’s an ongoing relationship throughout the traveller’s journey. And that’s where data becomes critical. Building an ongoing relationship and capitalising on the known preferences of the traveller can drive differentiation and build customer loyalty.
Reaching this level of personalisation and agility requires a shift in traditional business and marketing models. It means investing heavily in your technology stack, and having flexible back-end systems and processes, to adapt quickly to fast-changing customer demands.
OTAs need to establish capabilities in managing data for value to drive customer experience. Artificial intelligence (AI) and machine learning will help derive value from data more efficiently, supporting personalisation at every stage of the customer journey. For example, a young Australian couple on their first international trip together will likely have different needs and preferences to a German family that may be visiting the same destination around the same time.
As important for underpinning this level of personalisation and customer experience are seamless payment processes.
Innovation in payments are too becoming a key differentiator amongst OTAs. Especially since online behemoths continually raise the stakes. One example is Airbnb’s launch of its Pay Less Up Front feature, which allows guests to pay for bookings in two instalments, making the buying and payment more accessible.
Consumers’ expectations will continue to grow and those travel businesses that can offer them a flexible, fast and easy payments experience, while having B2B payment processes in place to support it, are sure to gain market share. They should therefore be making it a priority to expand their payment options in the front-end to drive conversion and enhance customer experience.
And by having a universally accepted payment method such as VANs in the back-end, matching the payment demands of an international customer base is easier than ever. There really is no excuse to miss out on global revenue opportunities.
Anthony has been Managing Director and CEO of eNett international since its inception in 2009. His career is characterised by innovation and entrepreneurial vision. Anthony has led eNett’s development from start-up to becoming one of the world’s leading travel payment companies, delivering ongoing exponential annual growth. Bringing more than 15 years of comprehensive business strategic and operational knowledge to the business, Anthony’s leadership spans the telecommunications, internet, human services, retail, financial services and travel sectors. As a founder of Optal (formerly PSP International), he combined his experience in payments and travel to create eNett International. A patriot and with a penchant for controlling the music at events, Anthony has been known to lead team huddles with a sing-along to ‘True Blue’ by John Williamson.
