Emerging Technologies Impacting the Travel Industry

November 6, 2008

Semantic Web

Peer-to-peer computing

Sentient Things

Wearable Computing

Smart Cities

User Interfaces

Personalization

Web services and system interoperability

Content Management

Wi-FI

3G Networks

Smartphones

Location Based Services

Customer Relationship Management

Portal Technology

Business Intelligence Systems

Leisure and Corporate Booking Engines

Call Center POS platforms

Business Intelligence Platforms

Multi-source Engines and Web Search Technology

Dynamic Packaging Engines

Merchandizing Systems

TTCI’s Focus

Overview• Consumer Online Trends

– Meta-search– Semantic Search– Behavioral Targeting – The Long Tail– Social Networking and User generated content

• Corporate Travel Trends– The Changing Role of Corporate Travel Management– The Trend Towards Procurement – The Trends Towards Business Intelligence

• Emerging Mobile Trends– Smartphone Adoption and The Frequent Business Traveler

Meta-Search

• Consolidation

• Move to more direct distribution

• Expanding globally and enhancing functionality

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Semantic Search

• Semantic understanding combined with natural language query can change the travel search environment

• Semantic search has value in a closed content environment such as travel

• The vision of the semantic Web may be years from reality. Closed semantic search is possible today.

Behavioral Targeting

• Targeting ads based on the consumer’s implicit and explicit behavior

• According to Revenue Science, a firm that specializes in behavioral targeting, in 2005 13% of all online advertising fell into the category.

– This is expected to grow to 20% of the online advertising market by the end of 2008.

The Long Tail First coined by Chris Anderson in an October 2004 Wired magazine article to describe the how the Internet facilitates the ability to realize significant profit out of selling small volumes of hard-to-find items to many customers, instead of only selling large volumes of a reduced number of popular items.

Example of Long Tail travel company:

“Simplify your life with the Rearden Personal Assistant, the first web-based productivity tool that intuitively manages the everyday details of work and personal life.”

User Generated Content and Social Networking

• Impacting travel planning and vendor selection

• Aggregation of multiple sources of user review

• Real-time interaction with social group

Tapping the Power of Social Networking

• Corporate America is embracing social networking– Mini USA tracks everything being said about

its brand everywhere online in blogs, discussion groups, forums MySpace and Facebook

– At HP 50 executives log into their blogs each morning

– Ernst & Young recruit many of the 3.500 college graduates it hires every year using a career group on Facebook

* Source Knowledge at Wharton

Social Networking for the Enterprise

• Many companies are adopting Web social networking technology to create internal networks.– An efficient way to mine for in-house expertise, discover new

recruits, and share information within their own walls

• More 30-plus employees are signing up with Facebook to trade daily updates with colleagues and friends. They're also building lists of contacts from among the 13 million professionals on LinkedIn.

• SharePoint, the Microsoft software that lets companies set up MySpace-like profiles, blogs, and collaborative Web sites known as wikis within the confines of their firewalls, is one of the fastest-growing server products in the company's history.

Community

• Community cannot be created but forms by consumers who perceive common needs and benefits

• What are the communities in corporate travel?– Travelers– Travel arrangers– Line managers– Finance managers– Others?

• What communities do your travelers already belong to?

• What can travel managers do to foster community

The Changing Role of Travel Management

1970s1960s 1990s1980s 2000s

• Airlines create the CRS to automate travel reservations

• Airlines provide ticket stock for corporate travel departments

• Travel is managed solely by individual departments as a budgetary expense

• Prices are regulated

• Airlines are deregulated

• Airlines create frequent flyer programs

• Many corporate travel departments become in-plants

• The CRS (GDS) is adopted by the travel agency community

• Airlines use CRS (GDS) to promote preferred selling though travel agencies

• The National Passenger Association (later to become the NBTA) is founded

• Introduction and growth of Travel Management Companies (TMCs)

• The CRS becomes the GDS, with a focus on global distribution

• TMCs use automation as a differentiator

• Corporate travel management emerges as a separate function

• NPTA becomes NBTA and ACTE is founded

• Travel management becomes a standard corporate function

• Airlines begin corporate discount programs

• Corporations develop preferred hotel programs

• Reporting becomes central to the travel management process

• Corporate booking tools (CBTs) are introduced

• Airlines divest their GDS ownership

• Corporate booking tools become mainstream

• Travel information moves from reports to actionable travel business intelligence

• Corporate procurement and finance increases its influence on travel management

• Globalization requires a more holistic view of all travel expenses, processes and procedures

The Trend Towards Procurement

Procurement’s Impact on Travel Management

• Increased focus on standardization and consolidation • Emphasis on Interdepartmental best practices• Real-time business intelligence

• In house subject matter expert

• Travel has unique practices and terminology

Traditional Travel Manager

Procurement Manager

• Commodity generalist• Views travel as a commodity• Established standard

methodologies and metrics

Procurement Measurements

• Total Cost of Ownership – (TCO) – Developed by Gartner, a technology research firm, in the 1980s used to measure the

total cost of deploying personal computers– In the 1990s concept of TCO was embraced by corporate procurement – part of ISM’s

accreditation process

• Scorecards– Evaluates supplier performance combining qualitative and quantitative

measurements – Can be used for supplier quarterly reviews

• Service Level Agreements – Ties performance to specific service goals such as speed of calls answered, adoption

of self-booking, effectiveness in policy compliance– Already a part of travel management – becoming part of TMC agreements

• Benchmarking – Comparing a corporations travel spend and policies with companies of similar size or

same industry– Also being adopted by travel management – used to measure effectiveness of

supplier contracts across all commodities

Information is Critical at Every Step of the Reservation Process

TMCBack Office(reconciled)

Ticketed

GDS

(ticketed)

Booked

GDS

(booked)

Travel Authorization

= Traditional Sources of Travel Data

= Emerging Sources of Travel Data

Consumed

ExpenseReports

Suppliers

Corporate Financial Systems

Charge Card

Sources of Travel Data

TMC Report Types

Data Warehouse Business Intelligence

Business Intelligence Platform provides:•Historical reports and trends•Dashboards•Predictive analysis

Call Center Reservations

Corporate Booking Tool

GDS

Moving to a True BI Platform

Best Practice GDS Travel Information Flow Today

Instant Information • Reports are giving way to interactive dashboards

• Business want answers• What will be the impact of a change in policy?• Where are there additional opportunities for

savings?• How does my company compare against like-

peers and industry benchmarks

Impact of Mobility• Ubiquitous computing – the age where the employee is connected

24/7 has arrived. This includes travelers as well as mobile employees (work at home)

The always connected traveler The telecommuter

"

An important characteristic of leading organizations in the 21st Century will be that they have developed effective and well-integrated employee mobility programs, including mobile office programs – Runzheimer International

Convergence

NR

Mobile Phone

Digital Camera MP3 Player PND Mobile Wallet Electronic Entry

Mini Laptops

iPhone 3G

Source: PhoCusWright Inc.

Smartphone Usage

• Frequent business travelers are far likelier to own smartphones and use them for both business and leisure

Mobile Web – Not the Worldwide WebNR

Worldwide Web

Worldwide Web•Ability to read voluminous text •Time to search and discover relevant information•Ability to multi-task on a single screen

Mobile Web

Mobile Web:•Screen size limits text•Information needs are based on location and situation•Requires that information be filtered so only relevant info is delivered

Future Trends and Device CapabilitiesNR

Point Based SearchUsing the mobile phone’s accelerometer you point to a building and it automatically retrieves information about what you are viewing Source: Intelligent Spatial Technologies

Smart Alerts and Sensor

The mobile device pushes you a personalized alert based on you preferences and location. Providing real-time snapshot of the current world conditions based on our location

Crowd SourcingAs people instantaneously post pictures, comments and reviews via their mobile device a world emerges where people from every corner of the planet are covering their experiences in real-time

Future Trends and Device Capabilities NR

Mobile devices will provide tools and information to empower you to decide what to download, what to see, and what to share.

Trust and Verification Automatic Updates on Apps and ContentThe always on device will deliver updates of applications and prioritize the applications most important for your location and situation

Augmented RealityProviding enhanced information based on your location and preferences

Summary

• Leisure online and enterprise computing trends impact corporate travel automation and business practices

• User generated content and reviews will continue to influence the travel process

• Communities are not created but exist naturally and need to be part of corporate travel strategy

• Information impacts every step of the travel process• Corporate travel is moving away from reports to providing

true business intelligence• Mobile impact on the travel experience is just beginning and

promises to have a dramatic impact on the travel process. Travel companies must look at mobile as a new platform for location, situational and personalized information