Why travel and tour firms must go online more

Dubai - Challenges that stem from the rate of technology adoption in the region must be taken head-on

Travellers today know that there is no shortage of options available to them, when it comes to selecting a tour or an outdoor adventure, and this is having a significant impact on the way they book, experts say.
Speaking at the second annual Travel Tech Middle East conference, travel and tour operators highlighted how there are lots of challenges that stem from the rate of technology adoption in the region.
"The Middle East is a diverse and fast growing market for tours and activities," said Nabil El Shafeay, founder and CEO of Visit & Go. "Small family-run companies form the backbone of the tours and activities industry in the region. Online penetration remains low though, with 80 per cent of sales still being made offline."
This creates several issues, especially with customers that like to make bookings at the last minute, he stated.
"Around 67 per cent of suppliers in the tours and activities industry in the Middle East operate without reservation technology - meaning they still use e-mails for bookings," El Shafeay said.
"In addition, 34 per cent use Excel sheets to manage reservations. Booking confirmations in such cases can take up to or be delayed by 24 to 48 hours."
Now compare this with customer expectations that lean almost overwhelmingly towards instant bookings. "Flights and hotels are booked instantly, but sadly this is not true for tours and activities," he said. "Travellers want instant booking confirmations, and they prefer paperless bookings. Mobile is the leading and fastest growing booking channel in the region, yet two out of five suppliers still don't accept online bookings; most don't have live connectivity to third-party resellers. Lastly, only one-fourth of suppliers in the region support same day bookings via resellers, and 41 per cent require at least one day advance booking."
El Shafeay also cautioned that it was important to keep in mind the fact that many travellers to the region like to make bookings only when they are at the destination. "Approximately 38 per cent of online bookings are made on the day of the activity; 53 per cent are made within a week of their trip and just 19 per cent are made in advance."
"Digitalisation has given travellers a whole new set of choices," agreed Leo Thomas, country manager for the Mena region at Insider. "Over 47 per cent of travellers visit different websites before making their purchases. The conversion rate increases more than 35 per cent when travellers experience personalised digital journeys."
He added that due to increasing competition in the industry, customer acquisition is getting harder.
"Data today pushes us to do more," said Albert Dias, co-founder and CTO at Musafir.
"It can help you draw some very powerful conclusions about your customers; and it can help customers to better manage their trips and bookings," he added. "What if you can tell travellers with absolute certainty that their flight is going to be late, and that they don't have to be at the airport for another two hours? The data to do something like this is all freely available on the shelf; the challenge is to get it to the customer in a timely manner. There is a change in mindset that needs to occur in the industry today."
Delivering experiences doesn't need to be expensive
Meanwhile, delivering a memorable customer experience doesn't have to be a very expensive move for a business, said Sanat Kagwad, business head of products at TechTree IT Systems.
Speaking at the event, Kagwad said that there are several myths that have been prevalent in the travel industry.
"It is a very common myth that delivering unforgettable customer experiences is going to be expensive for an operator," he said. "This is certainly not the case if you have the right platform."
Another very common myth, he revealed, is that businesses in the industry believe that they can buy their customers forever. The fact of the matter is that no one wins the price battle, he said. The last misconception that many businesses have is that customer experiences can only be mastered by new-age digital firms. The reality, he says, is that many traditional companies are better-placed with customer data and insights that can help them deliver the memorable experiences that travellers are looking for.
Statistics show that customers are five times more likely to transact with an organisation that delivers great customer experience. By 2021, 89 per cent of companies are expected to compete mostly on the basis of customer experience.
"If you have been operating in the industry for a while, then you are already well positioned because you know what customers like, and what they don't really care for," Kagwad said.
The key is to find an algorithm that works for you, he added. "The first thing that you should be doing is collecting data on your customers and their preferences. Secondly, focus on understanding that data. Then, drive the insights into action; and finally, measure your results."
Kagwad also urged companies to look at loyalty as a big factor and how they can reward it. "The focus has to be on the emotional delight factor. Make the customer feel like you are aware about their needs and preferences, and they will reward you with their loyalty. In turn, you should offer them rewards based on their likes and preferences. This special recognition will make your brand stand out to the customer and result in tangible savings in your time, money, and effort."
- rohma@khaleejtimes.com