Willem Niemeijer, founder of the Khiri Group, tells online travel platforms: Consumers don’t want volume of choice. They want an experience
Technology helps us to sift through large amounts of data and present it in a way that makes sense to us. The Internet makes the results available to billions. The travel industry is heading this way too, with the mushrooming of travel platforms, all seeking to replace the tour operator or travel agent.
On current evidence, this isn’t going to happen. Here’s why.
Allowing the consumer to be in touch with the service provider is the ultimate goal. But isn’t adding value the basis of any successful business? With online travel platforms, offering a lower price is usually the only add-on that they can come up with.
Willem Niemeijer
We’ve seen this before with hotel booking platforms, which took that industry by surprise and reduced good hotel sales people to commodity peddlers. According to the platforms, the only differentiating factors between hotels are price, star rating and a bevy of facilities. This may be true for the time-poor business traveler on a specific budget, but not for the leisure traveler. For them it’s all about the experience. Choosing from a staggering 1396 hotels in Bangkok doesn’t help the experience seeker.
It makes little sense then, to take the online platform model and try to force it onto travel experiences that combine hotels, guided tours and recommended ‘do-it-yourself’ journeys. It doesn’t work because local, authentic encounters and personalised attention are still the measure of a good holiday on the ground.
Travel platforms that have knocked on the doors of Khiri Travel, our destination management company, with offers to replace its traditional clients (tour operators and travel agents) with the ‘opportunity’ to connect to travelers directly are making an essential mistake. These online platforms do not add value for the customer. They merely offer a ton of products for them to choose from. And unlike hotel booking platforms, it’s very hard – or even impossible – for the holidaymaker to see if they are getting a price advantage.
Conversion rates are a solid way to test the success of online travel platforms. Dig a bit deeper and you have the answer as to why nearly all platforms are knocking on everyone’s door saying: “Please upload your products. We’ll just take a little commission.” They are using technology to let dumb volume replace relevance and efficiency. In other words, if you have 10,000 products and a very small percentage of them attract one or two bookings a day, is that being successful or inefficient? And who bears the cost of this inefficiency?
Delivering the perfect travel product to the informed customer needs a radical rethink. It’s imperative for tour operators and travel agents to stay on top of local developments in their destinations. Some already do so by shifting their product management to trusted suppliers, leaving them to focus on customer needs.
In the travel industry, delivering on promise isn’t good enough. It’s about exceeding expectations. That is complicated, as most travel products are used once by clients, then expected again, or a variation of it, in a separate country for next year’s holiday. However, successful tour operators and their network of suppliers can and do deliver on this as they have a deep understanding of their clients which is built on trust, experience, and in-depth local knowledge of the possibilities available.
The challenge is open for technology to improve on the quality and efficiency this DMC network delivers.
By Willem Niemeijer, founder of the Khiri Group
