NB: This is a guest article by Eric Dumas, CEO of Vayant Travel Technologies.
Travel was the engine that drove the first wave of ecommerce. Travel made ecommerce a star, as the online travel landscape - and far beyond - was transformed.
Now, it’s time for travel sellers to lead the next stage in the ecommerce revolution with customer-shaped travel shopping.
Travel enticed millions of people to take their first steps into ecommerce. Players like Lastminute.com brought a new spontaneity and excitement to travel.
Innovators like TripAdvisor let consumers share their experiences. Meanwhile, ecommerce reshaped travel itself, unleashing a structural shift that gave rise to a new kind of airline: the low-cost carrier, with its flexible business model.
Where travel led, other sectors followed, using the interactive and social aspects of ecommerce to further revolutionise the way people shop and consume.
Today’s ecommerce leaders are experts in shaping their offers around individual customer’s aspirations and shopping behaviour.
World-beating retailers like Apple iTunes and Amazon are "customer-shaped", using their knowledge of the customer to tailor and target recommendations, at the right time and in the right channel.
Yet the travel industry – the original ecommerce pioneer – is only taking its first steps towards this kind of customer-shaped shopping experience. As a result, travel shopping can seem like hard work.
According to research (WAYN, Frommer’s Budget Travel survey in August 2010) the majority of travelers visit anything from six to twenty websites to find the right flights.
Traditional air search is not shaped around the way people want to shop. Research shows that around 50% of leisure shoppers have no specific destination in mind when they go online, and 40% are flexible about when they go (The Future of Travel Search - PhoCusWright and Amadeus).
Imagine it’s a gloomy February afternoon in London. You’re looking for an affordable break in the sun: you don’t mind whether that’s in the South of France, Corfu or the Canary Islands.
You’re not that fussy about when you travel - but you do know how much you have to spend. You go online to find that dream getaway – but instead you’re confronted with an exercise in form-filling, with traditional search compelling you to look (often, again and again) for specific city pairs or dates.
Success stories like Amazon and iTunes teach us that consumers today want inspiration, not perspiration. They want recommendations that are personal and relevant: and they reward vendors who can provide them with this kind of customer-shaped experience.
We believe that becoming more "customer-shaped" is the key to addressing the four main pain points for online travel sellers. By adopting a customer-shaped approach, travel sellers have the opportunity to shift pain into gain.
1. Customer Loyalty
Loyalty is in an increasingly valuable commodity in the crowded online environment. It’s always better business to get value from an existing actual customer than spend money on acquiring new customers.
Customer-shaped shopping is key to a retention strategy.
2. Improve conversion ratios
Conversion is an enduring issue for the travel industry. Unproductive searches pile cost onto travel agents and burden the GDS and airline hosts with redundant requests.
By helping travel sellers better anticipate and meet needs, customer-shaped businesses turn lookers into bookers.
3. Attract new customers
A customer-shaped business is better at attracting new customers, leveraging the power of ‘word of mouth’ and using its customer insights to drive advertising and social marketing.
4. Reduced costs
By being better at anticipating – and then efficiently fulfilling - customer needs a customer-shaped business can reduce its operating costs.
Anything that can reduce hits on the GDS or airline host, for example, can help drive down cost (for both the travel seller and the GDS, a great win-win situation).
Conclusions
The benefits of being customer-shaped are clear. But becoming customer-shaped is not as daunting as it sounds. At the heart of everything is how efficiently travel sellers make use of search data: a valuable and perishable commodity.
Across our industry, we need to recapture a revolutionary mindset and be ready to examine and re-think everything we do.
This is essential to becoming more customer-shaped, and more successful. And it’s key to leveraging exciting new possibilities to make travel shopping an even more personal and powerful experience, by using platforms like mobile and social.
Yes, there are players out there who understand the way the world is going and are becoming more customer-shaped.
One example we admire is EasyJet. They are being typically proactive about exciting and inspiring customers. Their InspireMe tool is all about stimulating the imagination of the airline’s 400 million or so annual visitors, and enticing them to explore more.
As mobile becomes ever more central to travel shopping, the speed, accuracy and accessibility of search data will become critical success factors for travel sellers.
In the age of customer-shaped travel shopping, players who deliver inspiration – and eliminate perspiration – will be the winners.
NB: This is a guest article by Eric Dumas, CEO of Vayant Travel Technologies.