europe sights clouds
831 days ago
 

Top ten issues that could shake up the expansion of European travel

NB: This is a guest article by Aaron Gowell, founder and CEO of SilverRail Technologies.

Forget Silicon Valley, piles of VC money, giant online travel agencies and Google just for a moment – some of the most exciting developments in travel are taking place in Europe.

This fascinating period is being driven by a number of factors – rapid evolution of high speed rail services, as you might imagine we would say, but also adoption of mobile, video conferencing and smart, new sites which are changing the way consumers search and book travel.

Here are ten of the most important reasons…

1. London calling… to teach us a lesson

Hundreds of thousands of tourists (mostly un-savvy) are expected to descend upon the UK capital for the London 2012 Olympic games, and their airports (Heathrow, Gatwick, Stansted) are by no means ready for even a dress rehearsal for the influx of people.

Travelers in the know, seek out the rail infrastructure despite poor online functionality to reach the Olympic sites: some cope, some cry, people will finally get the point of rail travel.

2. Financial crisis confuses travel distributors

The Euro Crisis means corporate travel is getting squeezed and cut while the “Europe is cheap” world mentality sends more leisure travelers to Europe.

The result? Prices that don’t make sense to consumers, large OTAs outside of Europe will be poised to take up extra leisure inventory, and last-minute specials on corporate properties posing as leisure havens will abound.

Business hotels will become so desperate, that we’ll see the likes of Lady Gaga and other stars as part of business hotel marketing specials.

3. Video conferencing: the threat we keep forgetting

Don’t blink. Technology that enables travel has competition from technology that replaces travel.

Imagine Carlson Wagonlit buying skype to take share of the video conferencing market, and Cisco buying KDS. Video conferencing finally starts to matter, impacting the relationship between travel agents and technology providers.

4. Partnering gets real

So much for the promise of a unified EU, where businesses partner and consumers benefit, there’s still no way for a consumers to book rail tickets from Manchester in the UK to Nice in France in a single ticket.

When cross-border differences disappear, the industry gets a brand new market that is currently untapped by current travel distributors.

New sectors are created for travelers to access, and for distributors to sell. Cross-carrier rail ticketing partnerships (like interlining in air) means consumers flock to take new trips they were not able to purchase easily or at all before, and a big shift takes place from air to rail.

Those regions who invested smartly in rail speed and rail infrastructure see the fruits of economic development in their region, and more tourist dollars.

5. Room 77 and Room Key eat the old guard types, Hotels.com, Expedia and Lastminute.com

Old school OTAs are doing their best to capture consumers and build loyalty to their brands.

But while they were acting corporate and focusing on loyalty, others have lead introductions of innovative products never been seen or thought of in travel.

Room 77 and RoomKey are turning things upside down as they build differentiated content and consumer experience – the better mousetrap takes the customers!

6. Mobile impact

In short: traveler demand prompts mobile apps to replace TMCs for corporate travelers changing bookings, TMCs struggle to understand how to cope

As corporate travelers get better mobile travel products as consumers than they do as corporate travelers, TMCs can’t keep up.

They will need to invest in products, or acquire app developers to help them match the demand and pull towards competitive platforms.

Travel policy will not prevent the use of mobile by travelers, making mobile compliance and ease one of the most important parts of the equation.

7. Travel search is taken over by journey planners with multi-modal ticketing

We’ve grown accustomed to taking trips that are planned with the technology that exists. How limiting it has been, despite the travel industry’s so called edge or advances compared to other business sectors.

Now that tech can support how we think, (rome2rio for example is making a good start) travel itineraries will challenge the supplier, not the traveler.

You’ll be expected to mind-read then book it all with one tool. I want to go from London to Moscow for a business trip, then to the Maldives for a week of sun. If you can’t do that in a single tool, someone else will satisfy your customer.

After all, how we think, should be how we book.

8. Flashy specials

The daily special will become the menu favorite – and specialized sites eat the lunch of the OTAs with niche offerings and phenomenal service

The one-size-fits-all OTA cannot compete with specialists and travelers want to feel special. Whether wedding, golf, gay and lesbian, vegas specific, adrenaline junkies, business travel, group travel, – it doesn’t end there.

These sites with highly specialized offerings and expertise and high levels of service, hold a strong and growing stronger place within the travel sector. Speak their language, win their business.

9. Rail replaces low-cost-carriers on all short-haul journeys within Europe

Low cost, high convenience, safe environment is a new combo. Low cost air carriers cannot compete with the benefits of rail travel – comfort of working on the train, the convenience of arriving downtown, and far less environmental impact than air travel.

As high-speed rail expands, and as consumers can book those tickets more seamlessly, the low cost-carrier market across Europe will take significant hit.

Eurostar is a perfect example, taking over 80% of passengers on the London-Paris route. It’s already happening.

10. If two GDSs walked into a bar…

…and left with rail content that could integrate with the travel landscape of tomorrow… then we will have entered into a new era of distribution understanding. No one blames the bar.

NB: This is a guest article by Aaron Gowell, founder and CEO of SilverRail Technologies.

NB2: Europe clouds image via Shutterstock.

 
 
Special Nodes

About the Writer :: Special Nodes

Special Nodes is the byline under which Tnooz publishes articles by guest authors from around the industry.

 

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  1. Mark Rogers

    Hi,

    I was wondering if you have a hi-res version of the europe picture that I could use for a personal project?

    Regards,
    Mark

     
    • Kevin May

      Kevin May

      @mark – hi, thx for your comment.

      Unfortunately it’s a stock photo from Shutterstock. We’re not allowed to redistribute to other sites as it’s a single-use only image. Sorry about that.

       
  2. hhotelconsult

    Nice to see Roomkey getting mentioned as a shake up to the OTAs. Please. Anything to shake them up. And I don’t mean the reports that “Groupon slowly becoming an OTA”.

    Those guys are dinosaurs. OTA’s were a stopgap solution during the era of new technology. They’re middlemen, and those often become obsolete.

     
  3. william

    Some comments concerning 6. “traveler demand prompts mobile apps to replace TMCs.”

    I would have stated it differently: “traveler demand prompts mobile apps to replace TMCs but their company and their travel managers most of the time refuse to do so”.

    This has nothing to do with TMCs, and I would say even with mobile. The key need is to ensure a full end to end support to a corporate traveller throughout its travel journey. What companies want is to ensure duty of care, to ensure that the fare they negotiated with their preferred suppliers are booked (and to avoid booking made based on loyalty programs) and to streamline their travel program and processes (to reduce management overhead). If mobile can help at a reasonable price they will embrace it (is it the case today?).

    TMCs have contracts with clients (aka companies) having their employees travelling. So TMCs serve travelers based on the contract they have. Most of the time, TMCs use real humans (called travel agents) to offer off line services, and also, more and more, online tools. Most of the time, the client mandates the usage of these online tools (like corporate booking tool) … and rarely mandates usage of mobile apps (because it has a cost, not all employees have a smartphone and can afford roaming cost).

    Corporate booking channels (off line and online) are used by companies to enable booking of “negotiated rate”, but also to avoid travelers to pay themselves with their credit card by using a lodged card or a cost center and to ease expense reporting. I have to say that most of the travel mobile apps tend to make travelers pay immediatly their trip with their credit card (and sometimes it works only in a particular country to avoid fraud).

    Lots of companies are still using Blackberry fleet (with OS prior to V6), and disable the capability to surf internet and download apps (for data privacy issue).

    I do not think that traveler demand prompts mobile apps to replace TMCs. Traveler demand prompts mobile apps to enhance the travel services offered during their journey whatever who offers the service but at a reasonable price.

     
 
 

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