Travel & Tourism Technology Trends

I recently posted the summary of the presentation by Steve Barnhart, CEO of Orbitz. One the key points presented by Mr. Barnhart is that technologies are very good at aggregating and distributing travel product and controlling costs while increasing profitability, but they are not very good at improving the customer experience. He then went on to say that we, as an industry, should be focusing our efforts on using technologies to improve customer service. I emphatically agree with this point of view and yet I ask the question, why bother? Can technology really be used as a good substitute to human interaction? I don’t believe so. The whole thrust behind the user generated content revolution and social media phenomenon is centered around the concept of humanizing the web and adding a human voice to an otherwise mechanical medium. I have believed for a very long time (in Internet time anyway) that the value that travel agents bring to the travel purchasing life-cycle is a humanizing one. Machines are not accountable, a machine cannot be sorry or make you feel better, and would you believe a machine if it told you everything is going to be okay. A good agent knows about the many and varied rules that you and I, as the traveling public, generally don’t know. Not to mention, they can provide support along the majority of the value chain of the travel purchasing cycle, from dreaming and planning to booking.

As a travel technologist, you would probably expect me to say that I book exclusively online, and up until recently that was true. Why the shift from online back to agent? The short answer is that for the type of traveling that I have been doing recently (i.e. business travel), I don’t have the time or patience to wade through the myriad websites or metasearch tools to find the best fit for my trip. I know how the travel distribution chain works and I also know that, despite what many will tell you, yield management results in overly complex pricing that even the best metasearch tools cannot present in a simplified way. Given the growing number of metasearch, supplier, and OTA websites, the time required to search for a flight has increased despite all the time saving tools.

Let me give you an example of a recent booking experience. In November I traveled down to the Orlando for the PhoCusWright 2007 conference. I used Travelnow.com, which is an Expedia/Hotels.com property, to book the package. The process was relatively simple and I was able to get a fairly reasonable price for the flight, hotel, and car rental. Altogether it was a remarkably simple process that required NO human intervention. Because the flight was out of Seattle, my colleague Phil Caines and I took a shuttle from Vancouver to Seattle, with plenty of extra time to catch the flight from Seattle to Orlando. In a perfect World, this plan would have worked, if we hadn’t been “Pomeloed“. Suffice it to say, we were delayed crossing the US Border which resulted in Phil and I missing our flight. I immediately called the Customer Service number on my Expedia Itinerary and explained the situation. I was told that I would have to call each supplier separately to work out the re-booking details. In the end, I paid over $500 in penalties and re-booking fees, not to mention an entire workday spent in the Seatac airport lounge with limited Internet access.

It’s fair to say that my experience didn’t really have anything to do with the travel booking process and that the online purchasing experience was satisfactory. The problem is that customer service both before, during, and after the travel experience is a critical part of the buying process and a system that is specifically designed to push cheap product and reduce human interaction cannot support the customer service needs of customers who have issues, as I did.

So, where does this leave the travel agent? Simply put, travel agents need to stop worrying about delivering cheap tickets and focus on adding value to the travel purchasing process. The travel purchase process, for many, is a daunting and unfamiliar one. Travel agents, as experts in the process, need to focus on their strengths and market themselves as specialists. Online booking for travel is not going away and people will continue to book online. The one area that traditional agents can beat online is in the delivery of quality personalized customer service. Is this enough to survive in the high volume game of travel? Probably not, if you sell low margin commodity products like airfare and hotels, but if you sell niche high margin product, then your ability to demonstrate expertise could very well be your greatest asset.