The tour operator-OTA-vacation rental rivalry for the customer’s heart is playing out against this backdrop. If OTAs have moved a step ahead of the others in flight and hotel bookings, hotels in many geographies are struggling to maintain their lead over vacation rentals. Tour operators, once the only option for the traveler, may have lost ground but are the best equipped to provide all hospitality services under one roof. Whoever wins the customer experience game will win this three-way contest.
The importance of customer experience is not unique to travel and hospitality. Enterprises across industries are recognizing the critical importance of delivering an experience that sets them apart from their competition. The number might have gone up even higher since then. Circa 2019, customer experience is the factor that can make or break a brand.
Trump Card: Technology
Business and leisure travelers both want an experience customized for them. Travel and hospitality players have no option other than next-generation tools like big data analytics, machine learning and AI to offer customization and personalization at scale.
The process starts with the right offer at the right price at the right time. With the right technology solution, this is not too tall an ask. Thousands of companies from across the industry have benefited from RateGain’s rate intelligence, price optimization, electronic distribution and brand engagement solutions that leverage the latest digital and cloud-based technologies.
A principal reason for the dominance of large OTAs, besides the large transaction volumes and customer bases, is their ability to leverage data to gain business insights and offer value-added services. For example, when a customer books an airline ticket through an OTA, the platform will recommend booking on certain dates for discounted prices or suggest a hotel for the destination being booked. Apart from providing useful recommendations, OTAs also incentivize repeat business by offering customers targeted promotions based on past behavior.
Analytics is also being used to shape experiences according to the needs of individual travelers. Travel apps now translate languages in real time, offer live updates on flights and help find last-minute hotel deals. Premier Inn in the UK has been using The Hub Hotel, an augmented reality wall map that gives guests extra information about places of interest when they look at it through a smartphone or tablet. The use cases of technology solutions in travel and hospitality are limited only by imagination.
The Customer Experience playbook
Personalization of results and suggestions is one of the factors influencing the popularity of OTAs, something that the top tour operators are trying to emulate.
Despite their success, OTAs can do more to improve the overall customer experience and are thus attempting to break the perception that they only sell airline tickets and hotel discounts, and offer customers a seamless, 360-degree experience.
Tour operators are in the best position to offer to the widest range of travel and hospitality services but to provide the best experience they need to step up their technology game quickly. Multiple surveys show that the number of tour operators and package providers are declining in the US.
For starters, tour operators can harness the power of social media and web chat interfaces to build brand recall, and chatbots to offer improved customer support. In terms of customer experience, the chief advantage is rapid response time. A customer can get his question answered even in the middle of the night. Tour operators also have a strong human connect through their vast network of travel agents which a pure play tech provider like the OTAs don’t have. So the tour operators should technologically equip their travel agents to get access to customer data and product offerings to offer relevant personalized offers and make bookings, modifications quickly.
OTAs and Vacation Rentals have stolen a march over tour operators in this regard. US-based vacation rental company RedAwning turned to Amazon Connect to deploy Scarlett, a virtual assistant with AI, using automatic speech recognition and text-to-speech features to ‘converse’ with callers. Scarlett has reduced call wait times, enabled faster resolutions of issues and decreased the call load for human agents. Research indicates that the global cloud-based contact center market is expected to grow from US$6.80 billion in 2017 to US$20.93 billion by 2022.
Like chatbots and contact centers, Internet of Things (IoT) is adding to convenience and comfort. Using IoT, devices can be configured to automatically detect and respond to conditions in real-time, regulating temperature and light. The technology even helps property managers schedule preventive maintenance.
Connecting with airline APIs that allow customers to look up flights and add-ons from multiple carriers using an intuitive interface is another avenue OTAs are exploring to offer improved services. When customers use APIs to specify their preferences for flights and ancillary services, the total cost shows up in the search results and aids buying decisions.
The verdict on who will win this three-way contest will not be out immediately and might not even feature these players in the near future, however any player trying to master the experience game should learn from the playbook of these three segments to build the right data framework that can adapt to the traveler’s changing expectations.
About the Author
EVP – Delivering solutions for Business Needs in Travel Domain,RateGain
Leading Teams for product management, deliveries and operations of Travel vertical for products PG-OTA (RateShopping/NetReports), PG-Car, PG-Air and PG-Cruise