Marketing

Travo European Summit: Airbnb and Uber customer centricity hailed in Ixaris trends report

Posted by Lee Hayhurst on
Travo European Summit: Airbnb and Uber customer centricity hailed in Ixaris trends report

Ixaris will launch its Travel Megatrends Report at the Travolution Summit today. Alex Mifsud, founder and chief strategist at Ixaris Technologies, discusses the main findings and what it says about how firms need to link their back office if they are to deliver true customer centricity.

The travel industry is at a crossroads. Irony to one side, the travel marketplace is increasingly confronted by two opposing forces.

In one direction, increasing dominance by a small but powerful group of airlines, hotel operators and online travel agents (or OTAs), contrasting with a growing number of niche travel specialists, innovators and non-traditional operators in the other.

As this launch edition of the Ixaris Travel Megatrends Report makes clear, there is a viable middle way.

Often characterised as the ‘customer-centric approach’ this particular road actually begins far from the traveller’s own journey, or even their booking, starting out instead deep in the back or middle offices of travel providers.

It’s no coincidence that the success of the two greatest travel innovations of the digital age so far – Airbnb and Uber – came because, not in spite of, their detachment from the traditional travel or taxi business.

Freed from legacy constraints, and with a direct focus on their target customer, that was uncluttered by the complicated web of incentives, cross-subsidies and commissions that dominate their industries, they were able to re-imagine travel or transportation as it should be in the twenty-first century. Frictionless. Easy. Fun.

After all – whether we’re travelling for business, or on holiday, (and increasingly these days, it’s a bit of both) – travel should bring joy, shouldn’t it?

Starting out with a mission to make it easier to find a unique holiday home; or get a taxi in an unknown city with no cash to hand, both companies are, so far, unique in their ability to replace an anxiety-causing situation or experience with a joyful one.

Although Uber’s app, and Airbnb’s website and app, were instrumental in their success, their eureka moment was in realising that the digital era could remove generally-ignored customer stress from certain situations.

In both cases, the firms started with the customer and worked their way through the business improving everything – including back office processes – along the way, wherever it was needed, to create an enjoyable customer experience.

As Airbnb made clear during their interview here – the company’s success centres on a ruthless understanding of their target customer, and a commitment to re-write the rules where convention or travel industry tradition gets in the way.

For legacy firms, ripping up the rulebook and starting a journey to transform the business from the inside is not as easy as starting with a clean page.

But as we hope this launch edition of our Travel Megatrends Report explains, when in full flight, the digital era offers unmatched potential for operators with the right approach to take advantage of the anticipated growth in global travel – not to mention explosive demand for adjacent, perhaps undiscovered, products and services.

The journey will not be easy. Well over a third of survey respondents don’t know what key, ‘moment of truth’ processes like payments cost them.

And if the opportunity of digital is in its ‘long tail’ ability to provide niche services, travel’s digital transformation has a long way to go – 60% of small firms do not use advanced forms of payment like virtual cards, while half are paying higher transaction fees than larger rivals.

Setting out on the digital road requires charting new territory to connect the static, operational landmass with islands of floating, increasingly fickle, customers.

Often enough, this will require working with or supporting firms that were previously competitors. If in doubt, just check what’s happening in other industries in the middle of their own digital transformation (we work with some of them).

But it is worth it. Travel providers that seize the opportunity to dismantle their operational legacy – making use of new payments services and data gathering tools along the way – to create stress-free customer experiences, will reap rich rewards, just as the era of digital travel truly takes flight. In the digital era if you want to leap forward, you’ve got to keep looking back.

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