Amazon and its return to travel via the back door

Not anticipating the scale of the impact of mobile on the travel industry is quite an admission.

This is especially true when it comes from someone who has been involved in so many of the bleeding edge developments in the sector over the course of the last 20 years.

But Simon Breakwell, a figure at the centre of bringing the concept of the online travel agency to Europe with Expedia in the late-1990s, isn’t smarting from an apparent failure of wisdom.

Speaking at the Phocuswright Europe conference in Amsterdam this week, Breakwell was asked to identify two items that he didn’t foresee back when Expedia was the new kid on the block.

He clearly made up for his tardiness on understanding the fusion of travel with mobile by later being heavily involved in launching Uber in Europe.

But it his second admission that is perhaps the most interesting – and what he follows with as to how the current situation might develop further.

Breakwell says that he never considered the vast the sums of money would eventually be required to build and maintain a brand so that it can compete in search.

Furthermore, he would never have figured a rivalry between his former employee and Booking.com would essentially turn into a “Pepsi versus Coke”-type battle in terms of the spend and profile.

Their reliance on Google to acquire traffic (and only potential customers – lest we forget the low conversion rates in online travel) is a situation that has been in play for a long time, with many not really seeing a light at the end of the tunnel.

Breakwell sees a possible shift on the horizon – and it involves a brand that some always predicted would enter the industry in some way.

Amazon‘s efforts in travel seemed to come and go almost as quickly as you could say “trip planning, social travel website”.

It kind of launched a service in 2015 and pretty much abandoned the idea a few months later.

Perhaps Jeff Bezos suddenly got a taste of the foresight juice that others have yet to drink, but Amazon’s shift from being an ecommerce site to a search brand arguably puts in back in the game.

In addition, its shift to search is nothing to do with desktop or mobile but the introduction of voice through its Alexa service on hte Echo device.

Breakwell (like Paul English, CEO of Lola, who sang its praises the previous day) is a fan of voice-recognition tech.

He sees an environment where travellers will eventually ask their Alexa for flight details and the technology will organise it all, based on the commands of the user.

Echo has “apps” provided by a number of travel brands (Skyscanner was one of the first) that do this already, although most cheerleaders concede that such a process is clunky at times.

Google, of course, is – alongside others such as Facebook – developing its own voice tech.

But this far more subtle way of Amazon re-entering the industry, with its huge audience, means that it shouldn’t be ruled out as an important potential player once more.

And, to connect the dots, anything that reduces the sector’s reliance on Google (while it seemingly eats everyone’s lunch at the same time) is likely to be welcomed with a fair degree of enthusiasm.

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Kevin May

About the Writer :: Kevin May

Kevin May was a co-founder and member of the editorial team from September 2009 to June 2017.

 

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  1. peter syme

    I was at the Amazon Academy event in Edinburgh yesterday. Some reason why in my humble opinion they will be a major player in travel going forward.
    1. They are already working with a massive range of travel brands via amazon webs services and Alexa developments.
    2. As has been mentioned the huge amount of data they have on us all including our credit card details plus the big chunk of amazon prime customers
    3. They are learning at speed in different sectors working with some very clever partners in AWS about customer search and buying behaviour in sectors like fashion. A lot of this learning can be transferred into new online travel.

    Summary

    A serious combination of data, voice which will be massive, huge knowledge being gained via AWS partners plus resources means it is only a matter of time.

     
  2. Ginger Sullo

    Agree that the “Amazon” of travel is well on its way…especially considering A’s depth of audience behavior/purchase patterns, the corollary is obvious.

    Though as “personalized” as A is with its non-travel commerce, I think it will also then further commoditize the travel arena…so yes, it can jump in and have Echo play a more substantive role in travel planning/buying…though not the early “dreaming” stage. Seems the creative content and KINDS of travel trips..will continue with the herd mentality…thus, its another distribution pipe.

    Though A’s trip personalization, I doubt, will be higher then the major OTA’s…just that A’s Echo and unrivaled data repository will serve as a the key differentiator and OTA’s margins and loyalty will likely be far tougher to maintain.

     
  3. Timothy O'Neil-Dunne

    And don’t forget AWS powering much of the Travel Industry

     
  4. Glenn Wallace

    Amazon has a vast number of visitors. They have loyal customers with credit cards on file (something that Google does not have, and customers visit Amazon more frequently than travel sites so it is likely their profiles are relatively fresh and far lower churn than OTAs). They’re also a payment processor.

    They would be crazy not to monetize that with some kind of travel marketplace, huge opportunity. That OTAs and suppliers spend vast sums of money on paid search (and mostly on a very leaky CPC model) has been sustainable is surprising. There’s a big opening for a more efficient marketplace. The barrier to entry into metasearch has been incredibly low so there needs to be some other differentiator they can bring into play around customers and payments.

    There’s a thesis in here somewhere.

     
  5. Matthew Walker

    The irony that the “Amazon of Travel” might be Amazon. I don’t know why this would surprise anyone.

     
 
 

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