The theme "Rewrite, Rewind, Reboot and Rebuild" was at the centre of WebinTravel's recent TravelZero.0 event.
Over the course of four days, senior executives from all corners of the travel industry talked about current recovery trends and how the future might look.
Here's a summary of key takeaways from the hybrid event.
1. Be prepared to unlearn everything so that you can learn something new
In organising a hybrid WiT, we had to throw out the old rule book and write new ones. When John Brown (Agoda) and Cyril Ranque (Expedia Group) were asked which sacred cows had been killed in this pandemic, they said, “rate parity” and “last room availability” respectively.
Travel tech evangelist Johnny Thorsen suggested that NDC (New Distribution Capability), introduced by IATA to bring airline distribution into the new world, be written off as “too complicated” and “complex”. Whether he’s right or not is irrelevant, what matters is daring to challenge status quo and asking the right questions.
2. Travel will get smaller, tech will get bigger
As travel contracts and consolidates, will it become a small part of something bigger? Will travel become a niche product within super apps, marketplaces or wallets? Will those who are investing in tech and product now come out winners?
Wego is taking a bet on launching a new e-commerce brand beyond travel. GlobalTix laid off sales and operations staff, hired tech developers.
Speaking about airlines, C. T. Ooi, senior director for international flight business at Trip.com Group, says: “Airlines will get smaller. On the OTA side, there will be fewer OTAs as well, and the large will get larger. At times like these, it is the ones who can still invest in tech and product who will come out stronger. The ones who are just in survival mode will not be able to invest.”
3. The fight for survival will accelerate big-scale tech transformation, even old tech gets hip again
It’s hard to believe that the QR code has been around since 1994. That’s when Denso Wave (then a division of Denso Corporation) announced its release – the QR meaning “quick response”. Look at its wide adoption now, accelerated by Covid, where we can’t move anywhere now in Singapore without scanning a QR code.
Similarly with the cloud which has been around the 1960s but it is only in recent years that it has been gathering momentum and is now in hyper-speed with the pandemic.
In the session between Louise Daley, deputy CEO of Accor Asia Pacific, and Chris Lee, co-founder and partner at Future Now Ventures, we learnt that the reason for the slow adoption was the difficulty in getting enterprises to get their heads around it and commit resources to it.
Daley says: “Behavioural change is really hard, and organisations take a long time to change they way they purchase from a traditional model (ie on premise to “cloud”). Also, it’s sometimes hard to explain to boards something that is “virtual” or intangible.”
John Padgett, chief experience and innovation officer for Carnival Corporation, says something similar when he was asked by David Peller managing director, travel and hospitality, Amazon Web Services (AWS), on why it’s taken 20 years to deliver on his vision of the connected guest experience through the OCEAN Platform and the OceanMedallion wearable on ships from Princess Cruises.
“Changing enterprises is hard. It takes time because innovation of that magnitude requires commitment and resources. When you don’t have to change, human nature is to keep the status quo. But when you have to fight for your survival, change accelerates. And so you’re likely to see significant change and innovation in the years ahead due to the pandemic.”
My ears also perked up when Padgett said the OceanMedallion would be perfect for a small island like Sentosa, whose panel was on right before his session.
“With the OCEAN Platform, we’re using IoT to remove friction from the vacation experience and increasing personalization, including TrulyTouchless payment, dynamic wayfinding, shipmate locator and personalized itineraries; it speeds up embarkation; facilitates on-demand service; powers anywhere wagering – even keyless access to your stateroom. To do that, we’ve created what is fundamentally the first smart city – at sea, on board ships from Princess Cruises. And it’s all enabled by a small wearable device we call the OceanMedallion.
“The Ocean Medallion communicates with our xIoT network – thousands of sensors (~7,000) that recognize guests as they engage in our experiential environments including ship venues, cruise terminals, motor coaches, trains, airports and select ports of call, and provides crew members with information about each guest to help them provide better service.”
In effect, Sentosa could become its own Smart Island. Singapore has bigger ambitions of course to make the entire country a smart city but Sentosa, which is currently Singapore’s only island playground for domestic breaks, would be a good pilot. Necessity is the mother of transformation.
4. Think different about growth, sunset the peripheral stuff
Companies are rethinking growth. Eric Gnock-Fah, chief operating officer and co-founder of Klook, in his talk on “What COVID rewrote for me”, says that one thinking he was challenged on was “Do more for more growth vs Less is More”.
“Pre-COVID-growth was about vertical and geographic expansion while now we had to streamline our operations more, focus on most important priorities. For some markets, we had to pivot and make bets on new segments and verticals while painfully sunset certain projects, knowing they won’t be value-adding in the near term. New big bets we have made and now very focused on are: Staycations and Car Rental. Projects we had to sunset: Restaurants.
5. Go big or go deep
Never truer than now – the middle is going to be so squeezed to smithereens. In a world gone local and hyper-local, you either go deeper or you pick your battles on the global stage. Aloke Bajpai, CEO of Ixigo, says in 2019, Ixigo launched its app in eight Indian languages to be able to serve users across the country, and that strategy is paying off. “Almost 65% of our users now come from tier two, three and four towns,” he adds.
Klook’s Gnock Fah rethought “global network effects vs hyperlocal” at this time. “Global network effects that builds competitive edge for scaled up travel companies are no longer relevant in today’s setting. We had to redesign our organisational structure to allow for more flexibility and speed to market geared towards stronger local autonomy.”
6. Activism and recovery
We can’t sit idly by while travel dies. We must play our part – for example, the consortium, led by Expedia Group, proposing how to open a safe green lane for leisure using Singapore and Maldives as a pilot. It’s awaiting the green light from the Singapore government, with Maldives ready to welcome visitors from Singapore.
This pilot, if it works, can be rolled across different travel corridors. It can also be applied to similar travel corridors. Travel has the tech and relationships to solve problems for governments, this is going to take collaboration at a super level.
7. The rise and rise of communities
In a world fraught with fear and suspicion, people are turning to communities. To ensure they don’t turn into tribes that are divided, travel must ensure these communities are linked by common interests – diving, food, trekking. There’s no greater bonding power than travel.
“There is no power for change greater than a community discovering what it cares about.” – Margaret J. Wheatley.
8. Capturing demand vs generating demand
In the age of scarcity, travel brands are having to get creative about winning customers – harvesting vs hunting, says Traveloka’s Christian Suwarna.
Ixigo’s Bajpai said it had always spent zero on marketing so it didn’t make any difference to it.
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Klook is thinking about it differently too. In a global world gone local, Gnock-Fah says: “The playbook of capturing demand via search is no longer as relevant because locals are more familiar to their own country, hence less research required. Instead, OTAs will need to re-invent themselves in generating demand, which plays to our strengths. As an experience booking platform, we’ve built our marketing engine around social and content that inspires travelers to discover and book things to do.
"In line with that strategy, we recently launched in-app Klook Live. And the results in pilot markets have been extremely encouraging. We’ve seen a significant uplift in conversion rate of experiences that were featured during the LIVE show.”
9. Asia’s travel market will come out stronger in the long term because of the shift to domestic
Markets in Asia which have long relied on inbound are now having to develop their domestic base, and this can only be good in the long term. Tran Trong Kien, chairman of TMG Group, says the pandemic had woken him up to the domestic market which is, by no means, small in Vietnam: 20 million trips.
Think about what countries like China and Japan can do during this time to address their tourism deficit. An article I read recently noted that “until the end of last year, China ran a large 'tourism deficit' with the rest of the world, as an estimated 155 million Chinese citizens traveled abroad in 2019. And, these travelers made the largest contribution to the country’s trade deficit in services in 2019 (the $216.7 billion tourism deficit accounted for 83% of the total service trade deficit of $261.1 billion”.
With travel recovery well underway in China – according to ForwardKeys, as of mid-August, domestic arrivals at Chinese airports reached 86% of 2019 levels and bookings (issued air tickets) reached 98% of their 2019 levels – this domestic boost will serve China well. Domestic tourism now accounts for 10% of China’s GDP, and this can only go higher.
10. When goods don’t cross borders, soldiers will
“Get a flow of salesmen crossing the boundaries and the barriers will come down by themselves.” – Al Rabin, Peddler in Paradise (1914).
This quote was shared in the session with Michael Molloy, global travel and expense management category leader at Rio Tinto Group, who says corporations as much as travel companies must do all they can to keep business trips flowing.
We in travel must be the first to lead, we must travel for business as soon as we can and hold meetings when we can. For C. T. Ooi of Trip.com, it was his first business trip outside China. He travelled to Singapore via the green lane arrangement. The process was so arduous that “you wouldn’t do it unless it was absolutely essential."
It is good to see in the last week, a spate of announcements by governments across Asia to open borders – from Japan to Singapore. What’s needed next is reciprocity.
*This article was originally published by WebinTravel.