Walter: New ownership will help us
GTA anchors itself on a Vision 2020 as parent Kuoni Group puts itself up for sale and travel distribution continues to be fast changing.
The largest business unit of Kuoni pondered out loud its future yesterday, hosting an inaugural ‘g meet’ in Bangkok where it flew in a select group of suppliers, clients, technology companies and media to openly discuss the future of intermediaries.
Kuoni’s Board of Directors is supporting a takeover bid by Swedish private equity company EQT.
Meanwhile, competitor TUI is also seeking to sell Hotelbeds, with EQT speculated as a suitor. All this, along with current disrupters such as Airbnb and yet-unknown ones, is enough fodder to overturn a cart. But GTA’s CEO, Ivan Walter, stays rooted with a vision of GTA being the market leader by 2020 as “the world’s easiest travel distribution partner to do business with” – which he said is not as easy as it sounds.
The market is huge, complex and fragmented, said Walter. “Our mission is to reduce the complexity in the next few years. We have spoken to suppliers and clients in a structured way, asking them: What is it that you find painful? What is it that we could streamline, facilitate and make easier?”
A lot of components needs to happen before a room or an excursion can be sold to a client, he pointed out. “So how do we engage our technology partners to make it a rounded, easy and seamless experience? How do we embrace mobile, or help facilitate clients who do not have the funds to go digital? How do we evolve our portfolio so that the inventory, rates, products are relevant to clients and suppliers? We have over 200 million requests on price and availability every single day, how can we mine this data to benefit us all? How can we mobilise a sales effort to deliver business to suppliers and destinations that they find hard to get by themselves?”
The intermediary hotel market is worth US$170 billion, said Walter, and while giants like Expedia and Priceline are taking a lot of share, there are thousands of smaller players out there who try to innovate and give a different digital experience. “We can facilitate their growth (through inventory, technology, HR support, etc),” said Walter, alluding to the vast opportunities that exist for GTA.
But to fulfil the vision, GTA needs to invest in technology and people. In an interview with TTG Asia, asked whether the Kuoni sale clouds the vision, Walter said on the contrary, “new ownership will help us” in terms of resources to grow organically and inorganically.
“As well, today we are part of a listed company, which means obligations to communicate results and meet shareholders/analysts’ expectations. In a private environment, the obligation is less, so we can actually focus a lot more on mid and longterm targets to get us to where we want to be,” he said.
A Kuoni Group statement said EQT “is committed to invest” to enable the company to grow and strengthen its position as a leading service provider to the global travel industry and governments and to further increase its profitability. Group CEO Zubin Karkaria together with the current management team will continue to lead the company.
Asked if morale is affected with Kuoni first selling of its tour operating division, then the current sale bid, Walter said: “Absolutely not as people (within Kuoni) see the opportunity that we can move faster. We are in a growth market. It’s good news for everyone.”
– More reports in TTG Asia, April issue