Saurabh Das is a Group Vice President & Head of Global Service Line- Marketing & Experience Platforms at SapientRazorfish.
Today we stand on the brink of the most transformative revolution ever, the era of “connected intelligence”. Driven by smarter devices everywhere, armed with cloud based services and driven by cognitive intelligence, the world is changing at a dizzying pace and businesses are scrambling to keep up with this reality. Traditional enterprises are being forced to re-imagine their businesses as technology start-ups are conceived as digital-first and have the advantage of being business agile. The falling cost of innovation and low barriers to entry have resulted in hyper competitive marketplaces. Brand such as Amazon have pushed the phrase 'Winner takes it all' beyond what traditional businesses could ever imagine. Others like Tesla have seized the opportunity to reimagine a complete industry.
Travel and hospitality disrupted
In these turbulent times travel & hospitality as an industry is no different. The industry is currently facing large scale disruption propelled by the emergence of new technologies, ever-evolving competitive landscape and expectations of today’s customers.
Travel remains the most progressive expression of human curiosity and still relies on human connects for ultimate expressions of hospitality. This means, strategies adopted have to be far more purpose built for industry specific nuances. These strategies in turn are influenced by some major trends that the industry is witnessing.
Trend #1 - Handcrafting unique experiences and not mere transactions
Travel is no longer about transactional booking of air tickets, hotel rooms and sight-seeing. Modern day travellers seek – and often demand – experiences that resonate with them at a deeply emotional level and thus prefer authentic and personalised experiences. Being able to provide such individualised experience to them is only half the battle won. The ultimate deal is to be able to provide these handcrafted experiences in a manner that is scalable.
Anyone familiar with Brian Chesky’s (Co-founder AirBnB) principal of creating a great product-experience would be familiar with conceiving extraordinary experiences in the offline world first, quickly testing it on a willing Airbnb customer next. This exercise of intimacy with customer provides deep insights on product and service evolution. What follows is to take vital parts of the service enhancement and check for business viability, and then scale rapidly using technology targeted to the right consumer segment.
This exercise of handcrafting and scaling through a series of experimentations provides an extremely agile way to develop new features in rapid cycles. This sounds simple enough! Then what is the impediment here? Here Airbnb carries a significant advantage of being business agile and digitally led. Large enterprises often fail to adopt this because of legacy technology architecture, complex organisation structure or lack of an agile and engineering culture. They are now adopting the culture of engineering and agility, but they need to accelerate the process to stay competitive at core.
Trend #2 - Anywhere, anytime service – you need a service concierge
Today’s customers are a spoilt lot, demanding services anywhere, anytime. Food-tech alone has morphed customer behaviour to start expecting the food of choice delivered anytime and literally anywhere. Dominos now has services that can deliver at a designated public spot for those impulsive pizza lovers who cannot even wait to get home. Travel and hospitality brands looking to meet new service expectations must look for ways of hastening the delivery of services such as dynamic itinerary, streamlined purchase process and allowing instant access to assistance throughout. At the same time, their contact with the customer no longer needs to be limited to their part of the trip. An airline’s role in a trip does not start and end with the flight to the destination of travel, hotels are now more than just places to stay. The idea is to increase the time of interaction between the customer and the brand to longer than just the time where customers actually use the service. If done right these interactions can be monetised in exchange for enhanced services, creating completely new revenue streams. Lufthansa is a very good example of these interactions done right. From offline flight plans and lounge finders to real baggage tracking services, it is surely learning to stretch its relationship with its customers.
Brands should invest in building digital services using superior cognitive intelligence, which can perform the role of concierge across channels. This deep connection developed between the brand and consumer need does not only yield better satisfaction but significant opportunities to monetise value added services.
Trend #3 - Frictionless ecosystems over isolated moments
In the age of Amazon Go a shopping experience is literally picking up your favourite yogurt and just walking out. Then there are Chinese urban consumers who have completely abandoned usage of cash and cards and instead the only thing they carry is their phone for all transactions. Travellers are no different, customers today prefer value added services for seamless experiences that are an extension of their daily rituals, taking into account their preferences. No wonder Jack Ma (Alibaba founder) is investing in retail payments in Europe, to ensure ease of payments for the estimated 120m annual Chinese travellers to create seamless experiences.
This is compelling travel companies to create location- and context-aware- seamless interactions to their customers equipped with knowledge about not just the travellers’ exact location, but even what stage of their journey they are in. Disney theme parks can be seen doing just that with their magic bands allowing visitors to get services like FastPass for avoiding long queues, getting ride information, contactless payments and generally optimising the journey in the theme park for superior experience and also pushing value added services. For the assuming people for whom the magic band may come across as fad or folly, Disney used this opportunity significantly optimise their backstage operations and adding ability to serve more visitors. The data collected in park is a gold mine for generating real time analytics as well as insights that were not possible before.
Using technology to scale seamless experiences is fast becoming a feature of not just isolated travel companies but entire cities. Smart cities or destinations will soon be conceived as tourist friendly platforms enabling two-way communication between destinations and visitors. Such an open architecture will let tourist savour unknown destination with the same ease as locals.
Brands in travel & hospitality will need to have an open service architecture to brace the future that will be pivoted on platforms of data and services that can be used to orchestrate seamless customer journeys. Even after lot of speculation, thus far Amazon has stayed out of “Travel”. If they change their mind, they can bring stiff competition with simply their service, pricing and frictionless offerings.
Trend #4 - Crafting never-ending stories and lasting memories
Travel has always been about the memories you make and share. Travel habits hugely remains tribal in nature, with significant influence on likely choices made through social connects. Travel companies will do well to ride on this behaviour pattern, by being the storyteller, choreographer and glue for creating memories. Vail resorts did just that with their platform Epic Mix, allowing skiers to share their feats and even compete with people in their networks. Professional photographers capturing various moments can then tag individuals through RFID recognition and send through your “Epic adventure”, which can be socially shared. Co-created stories are often a more powerful tool for generating interest compared to branded content.
Another good example of leveraging social media to live in the minds of travellers well beyond the end of the trip is Hyatt’s campaign #InAHyattWorld. emphasising on the hotel values of hospitality. The hotel staff would perform random acts of kindness for guests and post their activities on the brand’s Facebook, Twitter and Instagram accounts. This prompted guests to join the campaign and they started sharing their own experiences. The hashtag soon went viral across multiple platforms, with guests from over 575 Hyatt properties across the world uploading more than 89,000 Instagram images. It’s a perfect example of how hotels can repurpose content to build trust with their existing customers, and motivate a potential customer to make a leap.
Trend #5 - Unified travel experience fuelled by singularity, dynamic partnerships and sharing economy
Consumers expect “whole” services for their travel need and not parts, an idea that is driving the industry towards singularity. This has propelled brands to forge dynamic partnerships to drive broader services. Airlines that are likely to manage the first leg of a travel, are well poised to be store fronts of travel. Qantas was one of the first airlines to push high quality content over AR/VR, with the first partnership with Tourism Northern Territory. Thus not just being an airline but a destination carrier.
Further, for brands to stay competitive, they will have to continue to look at options to stay operationally efficient and define services to monetise fixed assets more effectively. Brands such as Marriott and Accor are re-architecting their physical spaces to blend in hospitality, retail and commercial use in the same venue. This trend, which we started calling mixed use 2.0, will drive the traditional players to reimagine their businesses. Marriott, under its Workspace-on-Demand program, offers well-appointed workspaces and meeting rooms at its hotels. The sharing economy paradigms leveraged well will prove to be a big boon for the hospitality industry, creating new markets and sources of revenue generation. Justpark, a technology platform in UK, which lets owner rent out their unutilised parking spots generated additional revenue for hotels that let out their excess parking spots. In order to achieve this vision, enterprises will need to start building their businesses as a platform player like many digital first organisations.
The way ahead
Quoting William Gibson, author of Neuromancer, “The future is here. It’s just not evenly distributed.” The future of travel will demand businesses to shift hard to create value for customers through unique value added products and services that create seamless experiences. Speed will be the currency of business. Businesses will need to rapidly innovate to stay competitive in an age where the landscape will continue to evolve. This will need embracing a strong culture and willingness to make necessary investments and structural changes to their operating model.
The author is a Group Vice President & Head of Global Service Line- Marketing & Experience Platforms at SapientRazorfish.