Thursday, 12 March 2015

Why Travel Suppliers need to share data to protect the value of their products

The fastest growing and most profitable travel companies are those with a tonne of data and incredible grasp on how to engage with the mobile consumer, along with being staffed by intelligent employees. They don’t own the travel product.

Certain intermediaries are dominating the fast growing mobile channel so effectively they are stripping more valuable direct bookings away from the suppliers at a terrifying rate. These data savvy intermediaries are using their expertise to grow the product range they sell. (At our recent Conference “How mobile, data, and innovation will dictate which travel companies grow” Airbnb’s Mike Curtis made it clear that Airbnb will soon be expanding the product range it helps distribute.’s purchase of Open Table indicates the same desire there.)

The combination of data driven customer insight and the growth of the consumer using their mobile device means our industry can service the consumer for longer. As long as you have the trust of the consumer and the insight to know what they want you are going to be very profitable.

Right now the travel suppliers are losing the battle for this direct connection with the traveler and the related commercial benefits. One reason is they don’t have the insight. At the same event Ryanair’s CTO John Hurley told us that knowing what the airport knows would really help Ryanair provide a better service and be more profitable. Straight after his talk Chris Annetts, Heathrow’s Director of customer services said how he could benefit from the access to the customer knowledge the airlines holds.

Our Chairman, Sameer Poonja, Head of Digital for Emirates Airline asked why they could not share and the answers were system problems, legal issues but more fundamentally each travel supplier wanted to own the customer.

Surely travel suppliers are fighting the wrong battle. They need to work out the IT systems and legal issues that are stopping them sharing the data and work out a commercial arrangement that means they can best service the consumer. If they don’t the asset poor but data rich organisations such as, Airbnb, Skyskanner, and Google are going to make them the suppliers of small margin travel commodities.

The bottom line is travel is a people serviced business. TUI and Ryanair both told us how they are supplying their front line people with mobile devices to better service the consumer. How much better (and profitable) would that service be if they could start to share information with companies supplying the service along the travel chain.

By Tim Gunstone, MD, EyeforTravel