McKinsey Sees Data-Mining Giants Entering Travel
Who will be the next big players in travel? A report from McKinsey & Co. suggests that online titans such as Amazon.com and Google, both masters of collecting and using customer data, are well-equipped to play a growing role in the distribution channel. In The Trouble With Travel Distribution, McKinsey states there’s “no doubt that companies from outside the travel sector specifically tooled to make the most of data are going to figure things out, enter the market, and try to steal customers.”
While noting that Amazon is “notably absent from travel, at least for now,” the report also noted that the company “became the thorn in the side of every bookseller and, eventually, every retailer, by mining data to craft individualized customer experiences full of conversion-ready streams of recommendations.”
Google, which has legions of employees dedicated to data mining, is already reaching into the travel sector pie, according to McKinsey. “Its acquisition of ITA, a critical airfare search provider, already allows Google to provide users with instant travel itineraries and links to purchase (to see it in action, simply Google ‘NYC to LAX’).”
Good News for Agents: Service Is Still Key
McKinsey & Co.’s report The Trouble With Travel Distribution had one conclusion that bodes well for service-oriented travel agencies: “The game is now about delivering a superior customer experience. If players can do that, the investment returns will follow.”
Screen ICs Carefully, Pestronk Advises
“Agencies face a huge liability problem from rogue independent contractors. There is a roving band of criminals out there who get into travel agencies and issue tickets on phony credit cards. Agencies assume that it’s not as important to screen an independent contractor as it is for an employee. They assume that because this is an experienced person, they don’t need to check. If they are lying about their experience, they just won’t make sales. The agency is not considering the real consequences. So screening a prospective IC is very important.” – Mark Pestronk, travel industry lawyer
75% of Travelers Are Social Media Users
Expedia.com’s recent American Traveler survey found that 75% of those who travel use social media, with 51% of respondents saying they use it to stay connected while on a trip. The study indicated that social media has led to less-frequent visits in some families: 12% of Americans said they were less likely to visit their family in person thanks to social media. However, 25% said they were more likely to visit family in person. The U.S. study was conducted online by Harris Interactive among 2,262 adults ages 18 and older.
Down Economy Has Little Impact on Travel, Study Says
The economic downturn of the past few years did not affect the personal/leisure travel of 40% of respondents to Expedia’s American Traveler survey. Many people "travel as usual," particularly those between 35 and 44 years of age (46%), according to the survey. Another finding: just under one quarter of Americans (23%) are "at least somewhat likely" to travel internationally in the next year.
"Our data shows that even though Americans are taking fewer flights, they are booking more hotel nights," said Joe Megibow, vice president and general manager of Expedia.com. "We believe that Americans are proving to be resilient in a down economy, by driving instead of flying and taking more frequent, shorter trips."
A Matter of Attitude
“If you have a negative attitude, change it. A mood is temporary, but attitude is permanent. We all have bad moods, but a good attitude gets you out of them quicker.” – Nancy Friedman, owner, The Telephone Doctor Customer Service Training
Women-Owned Businesses Show Long-Term Growth
There are more than 8.3 million women-owned businesses in the U.S., generating nearly $1.3 trillion in revenue and employing nearly 7.7 million people, according to the second annual State of Women-Owned Businesses Report, commissioned by American Express OPEN. The growth of women-owned firms over the past 15 years in numbers, up 54%; in employment, up 9%, and in revenues, up 58%, exceeds the growth rates of all but the largest, publicly-traded firms.
Rules of Engagement
“When customers have more than one option for purchasing your goods and services, engagement is going to be the key differentiator. So instead of solely counting numbers, focus on getting to know more about your target audience. Ask about their interests, learn what attracted them to your business and cultivate relationships based on their needs.” – Rick Jensen, chief sales and marketing officer, Constant Contact