Technology is deeply entrenched in travel ecosystem today and needless to say that imagining growth in the sector without adopting or leveraging technology is just not the option. Whether it is a traveler making his booking, or a travel agency providing its services, or a hospitality player showcasing and offering amenities, technology has come to permeate most of the elements of travel. This increasingly complex landscape calls for powerful and modern travel technology frameworks.
SATTE 2023 brought together an eclectic panel discussion on ‘Travel Technology: The Growth Enabler’ aimed at sharing deep insights in the domain. The panel discussion, moderated by Ajay Kapoor, VP & Head – Procurement of a reputed financial institution, brought together some industry heavyweights as the speakers that included KD Singh, Founder and President of TravelBullz, Lokendra Saini, COO of EaseMyTrip, Ashish Sidhra, Co-founder of Alike.io and Chirag Agarwal, Co-founder of TravClan.
Growth Enabler
Opening the discussion, Kapoor pointed that technology has become an integral part of our life, especially after the Covid. “Prior to covid, people were just adopting technology for their comfort. Now, it has become a basic need rather than luxury.”
Sharing his thoughts Saini said, “Today technology has become very imperative for growth in the travel business. Just imagine how the travel business was around two decades ago. Almost everyone was doing the offline booking. It was such a scattered business. In the last two decades, more so in the last five to six years, the way we have seen the transformation in technology is a clear sign that unless you start adopting technology sooner rather than later, managing any kind of travel business is going to be extremely difficult and you will face challenges in terms of scaling your business.” Saini particularly stressed on the need to simplify the backend process in order to develop competitive advantage.
Space to Grow
Commenting on the adoption of technology, Singh said, “The use of technology in the travel business, especially in the B2B sector, has been more focused on the automation of the booking process. It has taken off to a stage where it should have happened. There is (still) a huge amount of space for the adoption of technology in the travel business. Right now, lots of transactions that we call online are actually offline. So, the definition of travel technology is different for different stakeholders. We have made lots of inroads in the last decade, but we are still far away from adopting technology to the level the FMCG industry or any other industry has done. We still have a huge amount of headroom.”
Sidhra said, “We see a very successful digitalization in airlines and the hotel industry and in some other areas. 70 per cent of flights and hotels today are booked digitally. But in the same travel industry, only 20 per cent of experiences are booked digitally, and in a country like India, it is in a very low single digit. So, the level of use of technology is different in different segments of travel. And it is the collective responsibility of the industry to digitalize across the boards, across value chains.”
Agarwal added, “In the Indian market, other than flights, 70-80 per cent of travel booking is still offline. When we think of technology, we must think of who our end customers are, and who our partners are. We need to understand the psychic of our customers, their behaviour, education level, and their intent to switch from offline to online. The level of adoption of technology depends on how much the other person wants to adopt it. It is very difficult to build and apply technology which requires customers or travel agents to change their habits.
Commenting on the adoption of technology, Sidhra said innovation itself is not good enough and what really works is applied innovations. “A good example is VR. When Google launched VR on its phone, everyone says this is how travel will be in future. Well, human beings don’t like to see the world through a VR lens. Customer behaviour is a key factor behind innovation and adoption of technology.” Sidhra also observed that the biggest thing that can transform travel is blockchain.
Also commenting on the adoption of technology, Agarwal remarked that there are two kinds of technology when it comes to bringing technology for end-users: one is which requires a change in habits and the other is which does not require a change in habits. He mentioned that whichever company has tried habit-changing technology they have either grown exponentially or failed so your probability of failure increases at the same time; your chances of becoming a big company also increase when you adopt habit-changing technology. But when you build a technology which does not require a change in habit but improves efficiency in the system and eases things for users, such technology will pick faster. Uber is an example.
Challenges
Addressing the issues such as trust and transparency, Singh pointed that technology has sorted out the issue of transparency at least in the case of pricing but challenges exist when it comes to complex itineraries or multiple services. Singh, however, agreed that lack of trust is a big factor, reason why “Consumers in India are researching online and booking offline. That is reality.”
Singh also pointed that unlike in the west or in markets like Singapore, Thailand and Korea, travel agents in India are averse to adopting technology. “Our company Travelbullz has a dynamic B2B engine which collaborates with all suppliers and puts all services under one, so that travel agents can book whatever services they want such as hotels, transfer, etc. Everything is automated but very few are using it. Agents would say that they are threatened by OTAs, but when it comes to adopting technology, they will not do it,” he said. Singh also said that a lot depends on the leadership of the company when it comes to adopting technology.
Flagging dangers to small travel agents who are averse to technology, Saini said, “I still feel that there is a tsunami left in travel to come which is going to wash away all the possible small travel agents who are not adopting technology.” Saini also underlined the need to shift focus on becoming an experiences-centric organisation.
He also said that nobody is trying to think from the suppliers’ standpoint. “They are just engaging in a battle of prices with one another as to who will offer lower prices. This leads to a situation where end-users go somewhere else that can offer something cheaper. This situation will never allow users to go 100 per cent online. This problem has to be solved collectively from the industry’s standpoint by creating a level playing field for everyone. The focus should shift to better product experiences,” he added.
Saini further said that he also feels the need to add vernacular as a factor in our booking and transaction system, at least for booking packages so that everyone can understand what they are booking, this should be done both at the product level as well as at the support level. “If we have to promote tourism both inside and outside the country, the biggest problem we have to solve in India is that we need to build a strong bond of trust and reliability with users. Absence of assurance and reliability is the biggest roadblock when it comes to the adoption of technology,” said Saini.
Agarwal lamented, “From B2B perspective, education is a challenge. Giving training to travel agents is challenges. Even if we make a very simple-to-use technology, it may not be adopted and used by agents as they are already involved so much in their day-to-day operation. They don’t have time to listen to what another person is saying.”
He also pointed that there are so many types of agents and therefore one-size-fits-all solution will not suit everyone. Furthermore, he added that hiring quality manpower for a technology company, wages, among others, are some of the other challenges in the sector.
Sidhra said that lack of trust and assurance is one of the biggest issues that travel tech companies face. “India is a standout market where we don’t have standardisation in prices. Here everyone expects there are lower prices in the market than what he or she is being offered. Users don’t trust. So, trust and assurance remain a big problem. There is a need for standardisation in the market which can be achieved through policy intervention. Policy intervention is required as policy intervention drives adoption. If there is no policy intervention, nobody will adopt GST, nobody will adopt UPI. For large-scale adoption of technology, policy intervention is necessary. The other problem is service delivery, services being delivered fall short of promises.
Saini also put the cost of technology in the spotlight. He said, “As your user bases grow, the cost of technology grows much higher changing your margin. The second challenge related to the fact that India is an extremely discount-seeking market, people look for prices as lower as possible. This sometimes creates challenges to retain users, and this also increases the cost of acquiring a user. So, it becomes challenging at times how to ensure that your business stays positive.” Offline package booking is another area of challenge highlighted by Saini.
Kapoor while concluding underlined the critical role of technology in the travel business. He said, “With the help of technology travel companies can optimise their cost, enhance customer experiences and also empower customers to take decisions.”
