Tourism & Hospitality | Thursday 26 April, 2018 1:05 pm |

A highlight from this year’s Arabian Travel Market, experts from Sabre, Wego and tajawal came together to discuss the top three trends that are transforming the travel industry.

Jorge Vilches, senior vice president Air Line of Business at Sabre; Ross Veitch, CEO and Co-founder of Wego; and Muhammad Chbib, CEO of tajawal identified three main shifts in the Middle East’s travel industry – evolving consumer behavior, digital transformation, and changing airline distribution models.

On consumer behaviour:

Ross:

“The Middle Eastern population is very young, so we are seeing change being driven by the habits of younger travellers.  For example, PC as a platform is declining, and mobile is increasingly prominent.  Growth in bookings is accelerating rapidly as people start to travel more often.”

Mohammad:

“The younger population is demanding more from travel; these travellers are looking to do new things that they haven’t done before.  The focus is shifting from routine to experience.  A lot of this is down to the influx of information they are seeing on social media sites – they want to be able to experience and broadcast their own unique travel stories.  As a result, addressing value for these travellers has become more complex.”

Jorge:

“The number of people travelling has doubled in the last 15 years, and is expected to double again in the next 15.  And in the Middle East, we are seeing double the amount of growth than any other region.  Supply is outstripping demand.  Travellers’ needs are also becoming more complex; it’s no longer effective to group travellers as ‘corporate’ or ‘leisure’.  The number of groups/types of travellers is increasing – and, in order to win business, it is essential that travel companies understand each of these travel groups and how to create value for them.” 

On digital transformation:

Muhammad:

“With the rapid evolution of consumer expectations, the industry has taken a tremendous leap towards digital transformation.” Said Muhammad Chbib, Founder and CEO, tajawal.  “Holistic data gathering to understand consumer preferences and identify behavioural patterns is crucial to designing wholesome and personalised travel experiences. Emerging technologies such as artificial intelligence, machine learning and augmented reality will help pronounce these efforts and unlock new avenues for consumer engagement. The challenge for industry players will be to perform the delicate balancing act between personalisation and automation, while continuing to provide convenient travel solutions and curate superior experiences.”

Ross:

“Today’s digitally-connected consumer wants simplicity, and the ability to shop the entire online travel marketplace in one place.  This is why metasearch has been very warmly embraced in the Middle East, in addition to the highly personalised experience it offers.  In today's world, consumer expectations for what their online services should deliver are being dramatically elevated by the almost magical experiences made possible by the application of new technologies such as machine-learning, neural-networks and deep-learning applied to very large data sets.”

Jorge:

“the Middle East is in the midst of a massive digital transformation – with regional governments expected to spend over US$15 billion in enabling technologies in 2018 – making it ideally-positioned to meet the demands of the modern, digitally-savvy consumer.  Travel agents can leverage the power of technology to offer a high level of personalisation and new experiences to customers.  Sabre is constantly investing in developing technology that can make this possible, such as the new Sabre Red Workspace.  This includes a number of new tools to help suppliers display their fares in new and innovative ways, and to help agents offer a higher level of personalisation to travellers.”

 

On changes in distribution models:

Ross:

“One major shift we’re seeing is being driven by the introduction of NDC.  However, there is still a gap between the promise of NDC and the reality.  Each NDC integration we have done is still different from one to the next.  At the moment, NDC does make it slightly easier to sell ancillaries through our platform.  But in the future, after it becomes more widely adopted, it has the potential to make things a lot simpler.”

Muhammad:

“The changes we are seeing now in travel distribution represent a major opportunity – quite similar to the transformation of the TelCo industry 20 years ago.  Just like the way you are now able to pick and choose components of a mobile phone contract, you are now becoming able to do the same with your airfare.  However, change leads to fragmentation, so standardisation – such as NDC – is valuable for the whole industry.  Standardising and automating processes will make it much easier for travellers to find and book what they want.”

Jorge:

“This industry is going through a profound transformation.  The impact of low cost carriers on traditional airlines is enormous.  Traditional airlines are pressured to reduce costs and differentiate; previously, the only capability to segment was on cabin class (one size fits all – you get cheap fare if you buy in advance and for certain number of days).  However, that is changing, and companies like Sabre are working on new functionalities – for example, NDC – which will enable suppliers to deliver tailored offers to different segments of travellers.”

“There will always be the need for transparency and comparison.  That’s why the value of the GDS will remain throughout this industry transformation.  The GDS puts all options in front of travellers, and enables any agency to book any flights all over the world.”

Three pieces of advice for the travel industry?

Ross:

“Look to advanced digital ecosystems like China for a glimpse of how the future is going to be – their digital econsystems are at least five to ten years ahead of that of the Middle East.  Also, focus on the speed of your technology rather than the way it looks.  And always benchmark your performance against that of other companies.”

Muhammad:

“Focus on data and insights.  Also, don’t jump on every new technology – around 95 percent of new technologies are fads and don’t amount to anything.  Lastly, always focus on the consumer and understanding their unique individual needs.”

Jorge:

“The first piece of advice would be to always focus on creating value for your travellers.  Second – and in order to achieve the first – make sure you understand each of your traveller segments.  Third, invest in your technology and online platforms – this will give you the edge over your competitors.”