The tourism industry nosedived during COVID-19, taking the biggest hit among all industries. Even as flights resume and stay-at-home orders get relaxed, booking and travel preferences appear to have significantly changed, making it seemingly impossible to predict demand. 

During this time, travel distributors and operators have been the most affected and have cut investments in technology to save on their dwindling cash supplies. 

However, customers are more concerned about safety and ease of travel now. Needless to say, vacation plans for one of the largest consumer groups - millennials - have shifted dramatically. Inconveniences like long turnaround time to curate travel packages, hidden vendor fees, and ever-changing health regulations are putting more pressure on agencies.

Here are some predictions on what the future of travel looks like and how online travel aggregators (OTAs) and travel agencies need to become future-ready to anticipate changing traveller needs. 

Key trends in travel sales for OTA’s and agencies

 

Trend #1: Price war amidst rising competition

The rise of online travel aggregators has offered more price transparency to travellers, which has led to commoditization. Giants like Booking.com, TripAdvisor and Expedia’s continued market penetration targeting price-sensitive customers—solo travellers, for example, means agencies often find themselves in a race for greater market share.  

 

 

Travel agencies lost a lot of revenue during the pandemic. Bouncing back meant expanding revenue streams and finding new ways to stay competitive. In the process, brands have begun pursuing other traveller needs that have become more relevant during the pandemic and go after them to create auxiliary services. 

Add to this, the rise of LCCs (low-cost carriers) and ULCCs (ultra-low-cost carriers), who prefer flyers to book with them directly to save on GDS costs. This has led to a further pressure on the top line for travel distributors. 

Trend #2: Digital experiences are here to stay with Industry 4.0

Today, travel agents are creating dynamic customer journeys with AI to understand different layers of customer intent. These data points are then utilised as triggers to target travellers with need-based content. To fulfill this, many agencies are partnering with technology vendors to improve overall digital experiences. Some of these include:

• Virtual hotel tours 

• Augmented reality -- interactive destination advertising, personal tour guides

• AI-based travel CRMs

• User-friendly reservation systems

• Conversational chatbots

• Content recommendation engines

• Automated email marketing providers

Tour operators are using these to embrace digitisation and grow their online presence. For example, leading global tour operators TUI and Thomas Cook are rehauling their business models to make their websites their main distribution channels. 

 

#1 : Understand traveller’s needs at each stage of the journey

Someone who’s just begun researching a trip, without deciding on a location, needs completely different content from someone who has been researching for the best deal on luxury hotels in the Maldives. Agencies can start by understanding what stage of the research process travellers are at, their preferences, and the key touchpoints where they seek more information. To unlock these data points, you can tap into: 

• Your leads from social and Google ads to see what types of people are interacting with your ads and clicking on them

• Web analytics to determine the pages that prospects first arrive on and the flow of their journey once on-site

• Email marketing analytics to find out what links customers click and where they navigate to, along with email open and click rate

• CRM to discover ‘prospect-readiness’ when they feel ready to speak with a travel agent through AI-recommended lead scores

 

You can further segment your customers and serve them relevant content that matches their requirements. For example, users that have clicked on your ads for short European city breaks are probably going to prefer receiving communications about similar quaint, small-town destinations than exotic beach holidays in the Maldives. At this point, you should also think about the metrics you need to track for success and whether each stage of the journey is getting the results you want.

 

#2 : Design the ‘right’ package with experiential elements 

Every traveller is unique. Agencies that are able to provide a variety of mix and match experiences that target a range of different travellers will have the most success.

 

Allow customers to build their own itinerary 

You can introduce new or less popular destinations within a chosen location to keep a lid on itinerary costs for budget travellers rather than simply serving a selection of readymade packages. Travellers can then pick local activities and places that match their own unique interests.

 

Design corporate travel experiences

Aligning business travellers to the right hotels, conference centres, and activities in their corporate travel locations comes with its own unique set of challenges. However, using technology that can automatically match corporate travellers and suppliers is quickly transforming this segment of the travel industry. The corporate travel world comes with its own set of challenges, including:

• Confusing external booking processes
• Lengthy post-travel expense management process
• Added stress from last-minute flight delays and itinerary changes

Agencies that can streamline this process and provide a plug-and-play experience for business travellers will come out on top. Using a CRM to send travel updates, handle the expense process, and bring together individual parts of a trip can build trust and maintain relationships.

 

#3 : Implement the right technology infrastructure 

To cater to changing travel preferences, travel agencies need to invest in customer engagement tools, like a data-driven travel CRM, that are integrated with a suite of backend tools -- booking management and travel inventory system, to focus on consistent product pricing. Travel agencies are using CRMs in a number of ways to provide better customer experiences and bring in new streams of revenue:

• Generate new leads from lookalikes: Travel CRMs generate new leads by targeting different demographics who have similar attributes to that of past customers and serve content or visual experiences created by the same previous customers during their trip through the agency.
   
• Implement chatbots: Integrating chatbots with your travel CRM means customers can request information in the moment and be directed towards the relevant content stored in the CRM. You can also serve guided conversations and redirect travellers to the right content based on their destination and budget. On top of this, AI-based sales assistants are a great way to attract new, low-cost leads as prospects often feel more comfortable engaging in content in their own time rather than having to fully rely on an agent.

 

• Generate quotes quickly: Provide in-the-moment quotes and send instant invoices to keep the sales cycle in motion and maximise the customer experience. CRMs help travel planners create quick travel proposals with the option to automate pricing, which takes into account seasonality and personal details about the customer.
• Centralize all customer information to curate multiple offerings easily: Eliminate any confusion and double data entries by having all traveller information (passport information, food preferences, accommodation, birthdays, and personal details) in one place. Travel CRMs help streamline and tie up the different offerings of an agency, from tours and accommodation to on-the-ground experiences and inter-city transport.
• Monitor sales productivity: Keep an eye on how each travel agent is performing and help them track their incentives that are tied to closed deals, new traveller wins on the CRM.
• Reward loyal customers: It’s easy to identify your most loyal customers with a real-time visual view of trips made, bookings done, frequency of travel through a travel CRM. You can also leverage this data to provide them with extra travel incentives, like a free restaurant meal or discounted hotel stays with redeemable points.

A 9-point checklist to choose the right sales tech

 

 

 

Wrapping Up

The past year has changed the travel landscape dramatically. Customers now prioritise safety, while travel agencies are doing all they can to bounce back after a hard year. It’s difficult to say exactly how the pandemic will affect the travel industry in general, but the new expectation driven economy will make sure that it’s:

• Smooth and seamless

• Contextual and personalised

• On-demand

Technology is taking on an increasingly important role in the travel industry to align agency offerings with the current-day requirements of travellers. The revival of the industry depends on how effectively companies are able to provide personalised experiences, additional services, and a seamless experience from start to finish.