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Building Better Connections in the Global Travel Marketplace

There are comforting constants in this business. Gracious hospitality, fresh linens, and morning coffee in an oversized robe all call to mind the rich traditions of the hotel industry. Yet behind the familiar images, there's a rapid evolution underway in how the many features and benefits of the hospitality industry are marketed and sold to customers. There are new ways to connect suppliers and travelers. There are emerging technologies for more effectively matching supply to customer demand. The rapidly developing world of customer-generated content is but one example of where the industry is just beginning to learn the extent to which these emerging technologies can shape the decision process of customers as they select the accommodations and other services which best meet their needs. Because these technology and business innovations will lead directly to better processes and more satisfied customers, I believe they will greatly benefit the industry as a whole. I also believe they will catapult the relationships between online travel agencies (OLTAs) and hotels beyond that of supplier and distributor to one of true strategic partners.

Over the past decade, the OLTAs have played a major role in the evolution of the industry by driving the development of new technologies as well as many of the new business and revenue models that are reshaping how travel is bought and sold in the global travel marketplace. It is the intersection of these transformative technologies and innovative business and revenue models that will drive the future of marketing and sales in the hospitality industry. For OLTAs, what this means for the coming years is moving beyond channeling large volumes of relatively untargeted customer demand to suppliers. Instead, we'll move toward a more intense focus on bringing together the right customers with the right hotels. Everything else will flow from that.

The ability to bring the right travelers to the right suppliers will be driven by new yield management services, new forms of fenced sales and distribution channels, as well as powerful marketing and merchandising opportunities that more fully leverage the tremendous reach of global media companies such as Expedia, Inc.

For instance, with consumers showing a strong interest in travel shopping by theme, compelling opportunities already exist to market properties and destinations associated with themed experiences.

Several OLTAs, including Expedia.com, currently offer an array of vacation packages, ranging from exclusive luxury escapes to family weekend getaways, destination stores, and unique tailored promotions. In the coming years, we will also see the implementation of both new and existing technologies that will allow the OLTAs and other tech-savvy organizations to better manage the dynamics of supply and demand. This will mean improving efficiencies in travel supply chains and optimizing pricing and inventory management systems.

To take one example, evolving CRM (Customer Relationship Management) technologies will better connect suppliers and customers via increasingly targeted and tailored package offers to travelers in ways that directly reflect real-time and forecasted inventory availability as well as optimal revenue management strategies.

One vitally important trend we’re likely to see is the growing use of customer feedback and other user-generated content. There are a number of ways that OLTAs and other companies with a significant Web presence might choose to highlight and use this type of content to the benefit of both customers and suppliers. For example, wiki spaces, in which users both write and edit one another’s travel tips, personal experiences, property descriptions, and other topic-specific information, are proving incredibly popular forms of online themed communities.

Several OLTAs and travel media companies have already leveraged traveler-generated content to great success. For example, TripAdvisor is the world’s largest online travel community -- its active members numbers in the tens of millions -- and it consists almost entirely of member-created content that other travelers clearly find valuable and compelling. Another implementation of user-generated content, currently deployed by Hotels.com and several other OLTAs, involves accepting postings only from individuals who have actually stayed at a particular property. OLTAs have also found ways to offer this unbiased, user-generated market analysis to help customers select the right property for their specific needs. Moving forward, OLTAs are well-positioned to take the wealth of customer feedback and other insights generated out of these communities back to hotels and other supply partners as value-added market intelligence.

The evolving efficiencies and economies of scale offered by leading OLTAs will mean that we’re increasingly positioned to provide more value to more customers and more supplier partners. This will benefit both the largest hotel businesses as well as thousands of unique, individually owned properties that comprise the diverse ecosystem of this industry.

Look for these and other key trends in the year ahead. I look forward to enjoying the journey with you

 

 

 

There's a rapid evolution underway in how the many features and benefits of the hospitality industry are marketed and sold to customers.

 

 
 

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