This is a viewpoint by Ritchie Brett, strategist at experience design studio 383.
The way we’ve come to use the term ‘disruption’ in recent years has in many ways become a distraction. The fact is, when we talk about ‘disruptive’ organisations, we are often actually talking about organisations that have found a better way to serve customers.
Taking this further, the term 'disruption' is almost interchangeable with 'new digital technology'. This leads us to a backwards function-follows-form scenario. While tech is most likely the answer, taking a tech-first approach often leads to distraction.
Before we identify a solution, we need to fully understand the problem: the frictions in a customer's journey, the things that cause stress and impact their experience. The three key steps to disruption is the same in the travel and hospitality sector as it is across any other vertical. You have to:
- Identify the customer
- Identify customer frictions
- Move quickly to address those frictions
The historic lay of the land
The days of visiting a physical travel agency to book a vacation are not that far behind us and many of us can still vividly recall the experience: from entering the premises and being surrounded by glossy brochures, to carrying armfuls of catalogues for inspiration, having conversations with real staff and tasking them to find your dream escape. For the discerning travellers among us, the process could take several weeks, with more calls and additional visits to the agency.
It’s important for today’s innovators to identify these pinch points – and so, whether you recall the travel journey back then or not, here’s a reminder of what it used to look like:
The advent of the internet provided a route to change this. But this happened because businesses used the technology to address users frictions, not by virtue of the technology existing.
This why solutions in the table focus on addressing the frictions and not, at this stage, the detail of how.
Those organisations who became the first wave of OTAs understood these customer frictions, then leveraged new technology to change and improve the experience to lessen or remove those frictions entirely.
The friction challenge
The challenge for any business is that customer friction, as with expectations, are fluid, they're relative and influenced by factors outside of organisational control. They're social, political, physical, psychological, emotional, economic and technological.
Often shifts in customer attitudes are born out of things happening in other seemingly unrelated sectors and markets where new expectations around the speed of delivery or customer service, for example, are redefined.
Change the curve
So if the curve is always changing, how can you stay ahead of it? Or even better how do you change the curve? How do you become the disrupter instead of the disrupted?
Let’s look at large international hotel companies, which we’ll call 'the incumbent’.
As the hotel incumbent, you have a large share of the market, and you’ve likely been delivering your services for many decades. First let’s recognise that by the virtue of you being here today, you’ve been a successful innovator in the past.
But while both are important, innovation and disruptive innovation are very different. It could be argued that innovation was focused on faster horses, while disruptive innovation was creating the car.
The unfortunate thing for the hotel incumbent is that we now live in a world where technology enables the David to your Goliath to grow at a pace that is almost unbelievable.
So what can the hotel incumbent do to safeguard their future?
The best defence is a good offence. Beat the competition to it and disrupt yourself.
Applying new rules to old tools isn’t good enough. You’re goal is to make your existing solutions obsolete. This maybe a scary thought, but this is exactly what Apple did to their iPod when they created and launched the disruptive innovation that was iPhone. Apple took a calculated risk and killed their own product. A very successful product, but in doing so completely disrupted the digital music and mobile phone market.
Utilise the information you have. As the incumbent, you likely have access to far more valuable information and insight than the startup disruptor. Use this information to identify the opportunities that lie to your left and right. Where are your customer frictions? How could you address them?
This is exactly what Hilton have done with their Explore platform. Hilton looked in depth at the customer journey and identified an opportunity to engage customers closer to the start of the journey. The Explore platform enables Hilton to engage and inspire its target audience in the dreaming and planning stages of the travel journey, but also provides tangible tools to help customers to plan and book. This puts Hilton into a relevant space in which its target audience is yet to make a decision on accommodation. Working in partnership with tech startups, the platform continues to innovate and evolve around the customer.
As the incumbent, the cold hard truth is, not all disrupters are looking to knock you off your perch. Many startups are looking for partners. Be the partner. Leverage your route to market, work with them and disrupt together.
Shift the focus from the word ‘disruption’ onto being the best, by resolving frictions to deliver beyond your customers expectations.
This is a viewpoint by Ritchie Brett, strategist at experience design studio 383.
Opinions and views expressed by all guest contributors do not necessarily reflect those of tnooz, its writers, or its partners.