What are the big disruptions coming for online travel? Recently The Phocuswright Conference in Los Angeles explored these disruptions in some detail, some more than others. In short, the big disruptions seem to be the emergence of Big Data, the growth of the Chinese travel market, the accelerating shift towards mobile devices away from desktops for travel research and booking, and the blurring of lines between metasearch and the original group of online travel agencies.
Big Data and airline restriction of data
Last week, I discussed the coming impact of Big Data on travel. It seems that data is being mined from everyone except the airlines who hate to share anything with anyone else in the aviation distribution system.
Airlines are not disclosing passenger-specific and flight-specific ancillary fee data. And, airlines are now beginning to restrict where their “public” airfares can be displayed. If anyone has checked Hipmunk.com, tripadvisor.com, mobissimo.com, fly.com, skyscanner.com or some other search engines, they will not find Delta airfares. The airlines have decided to pick and choose where airfares can be published.
Travelers United holds that airfares are public information and that restricting these airfares, which are published in newspapers, on computer displays for travel agents, by online travel agents and some metasearch engines, cannot be selectively removed from the public’s view on a site-by-site websites.
This airline-induced disruption is anti-consumer and anti-innovation.
China
The emergence of China as a major travel player is certainly a disruption. Every major online business has reason to take a close look at the emerging major middle class of China and its billions of wannabe tourists. Online travel agents are scrambling to find a foothold in the Chinese market. Mobile operators are angling for customers and additional platforms for a country that has largely skipped the desktop use of the Web and jumped right to tablets and cell phones.
Attendees of The Phocuswright Conference heard from the CEOs of the largest Chinese online travel agencies and saw slide after powerpoint featuring the coming growth of the Chinese middle class and its pending impact on the world’s travel and tourism.
What is metasearch and what is a travel agent?
Another “disruption” is the blurring of the lines between what was once a distinct world of metasearch — hotel and air sites that provided the ability to comparison shop across many websites — into conglomerates that include a bit of everything, including booking capabilities. The merger of metasearch with booking engines is straining relationships in the distribution and sales channel that have been developed over the past decade.
For instance, TripAdvisor, once a collection of user-generated reviews, focused on hotels, has been growing into user-generated reviews of restaurants and local tourism providers. Plus, TripAdvisor is starting to allow users the ability to instantly book hotels and other travel through their website. No longer will those reading reviews on TripAdvisor need to click through to an airline, hotel or travel agent site; the transaction can be done seamlessly without leaving the TripAdvisor universe via Web partners.
This blurring of the lines between metasearch like Kayak, Hipmunk or Skyscanner, has led the Department of Transportation (DOT) to classify these types of websites as ticket agents that will come under DOT’s control and rules. Though the metasearch sites have been battling DOT over being called ticket agents, they have been touting to the online world at the PhocusWright conference that they are capable of easy and instant booking without leaving the metasearch environment.
Either they are ticket agents, as they seem to claim at this worldwide conference, or they are not, as they claim in comments recently filed with DOT in response to a rulemaking. This one has a way to go before the final DOT rule is cast.
Mobile disruption
Finally, we turn to mobile. Every website has seen a phenomenally fast transition from the desktop to mobile. This transformation of the market now sees mobile with 30-50 percent of searches, but the types of searches and transactions are different than those that predominate on laptops.
For instance, hotelstonight.com, that focuses on last-minute hotel bookings, was designed as a mobile platform. So, it has no desktop presence to speak of. However, Orbitz, that has made a strong push into the mobile world, even adding discounts and other incentives for bookers to use mobile, still is not breaking the 50 percent level of mobile penetration. TravelersUnited.org, the sister site of ConsumerTraveler.com, is registering mobile users in the 30-40 percent range. Clearly, mobile platforms are making a strong impact.
These basic changes in the online marketplace in collecting data about customers, international developments, the evolution of metasearch and the growth of mobile will continue to shift the online travel world moving forward. However, though there was wide agreement about the disruptive impact of these change factors, there was no consensus about how best to deal with this changing landscape.
The changes that change creates is going to become an ongoing story over the coming year.
Charlie Leocha is the President of Travelers United. He has been working in Washington, DC, for the past 14 years with Congress, the Department of Transportation, and industry stakeholders on travel issues. He was the first consumer representative to the Advisory Committee for Aviation Consumer Protections appointed by the Secretary of Transportation from 2012 through 2018.
