By Joe Buhler, Principal, buhlerworks
In less than ten years since the first wave hit with the introduction of online travel agencies, the travel industry is again undergoing radical changes. Online travel, in what ever form it was and still is defined, became the largest industry on the web in record time. Changes on a scale imagined only by few, have happened since then and there is not one segment of the travel industry that is not affected by that first shift to commerce transacted online. By the end of last century, it was mostly in the United States where the initial start-up companies were concentrating their efforts and where the phenomenal growth first took place.
Today, the impact is felt around the globe and the fastest growing regions are now Asia/Pacific and Europe, and the original online travel agencies (OTA) are players on a global stage. In the past few years they have, at least in Europe, been joined by the traditional major tour operators who are now engaged in intense competition with these intruders on what many considered their turf, and after having been written off by many only a few years ago.
In a recent article, Travel Industry Wire mentioned the expression of the “customer-to-customer” (C2C) marketplace. This is a very apt description of what is happening today. Enabled by blogs, pod casts and social networking sites as well as other web 2.0 technology introductions like mashups, the consumer today can be as informed about any subject as never before in history and even more importantly, has the easy means to communicate his or her knowledge and expertise to anyone else in the world. In the context of the travel industry, everyone can become a travel agent, tour operator, or even destination marketer at least in his or her own mind. The ingredients and the tools are certainly at their disposal.
Companies and organizations will in future increasingly have to try to interject themselves into all the conversations going on among customers in the marketplace about their product, service, or destination, rather than dominating what in the past was a one-way communication. This new C2C reality will have a significant impact on the role of marketing in any industry. As Seth Godin, the author of some of the most innovative bestsellers on marketing, including “The Purple Cow” has said: “Conversations among the people in your marketplace happen whether you like it or not. Good marketing encourages the right sort of conversations.”
The first signs of this world of Web 2.0, which lets the audience participate in the production and distribution of content and tag it with keywords, in a social networking environment, were sites like Del.icio.us, Diigo, and Digg. In the travel space there are of course TripAdvisor owned by Expedia and IgoUgo, owned by Travelocity, which have been around for a number of years with active communities of feedback and personal review providers. Both they, as well as the traditional online travel agencies, face a new type of competition from the likes of Uptake, TravelMuse, Tripbase, and more. The most important feature these sites have in common, is the ability for people to review user generated information from various sources that is relevant to their trip and based on their personal preferences. These sites makes it easier to plan a trip prior to reaching the booking stage and thus improve the overall dream – learn – plan – go stages by offering a better integrated solution than the pure booking sites. How these newer start-ups will fare in the future remains to be seen but they are a clear indicator of the evolution of the search – shop – buy travel experience.
Blogs and recently Twitter, are other developments with significant potential impact on both trip planning and the actual travel purchasing experience. Anyone with web access and some basic knowledge of computer software applications can in fact start a blog or even easier establish a Twitter account and making their experiences and commentary immediately available to the world at large. With a free RSS feed reader, this new user generated content is as easily available for anyone with updates delivered automatically to their screen.
The specific impact of Travel 2.0 on the various sectors in the travel industry is yet to be determined. What seems clear already, however, is that the role of any intermediary is being challenged even more by all this user-generated content, combined with the free flowing consumer conversations going on 24/7 on all the sites and the transparency this creates. As these web based innovations further develop and become even more user friendly and widespread than they already are today, combined with improved and integrated booking functionality, the changes will be more dramatic than what we have experienced so far.
For destination marketing organizations (DMO) the dynamics of existing business relationships will no doubt undergo rapid and significant change. It will no longer be sufficient to maintain and develop an information rich destination website. To build a platform that taps into and feeds off the various sites mentioned earlier and to facilitate the dialog among past and potential future visitors is fast becoming a necessity to stay relevant. The opportunities have never been better to truly achieve WOM (both the mouth and mouse kind) and stimulate the buzz around a destination. What no DMO should attempt is try to control the dialog or manage it. The mirror has never been shinier but it also has never before been pointed as directly at the destination and its suppliers as it is today. Accept it, embrace change, innovate and start joining the conversation, today. The alternative is being left behind and risk being ignored.