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How to market and sell unbundled travel
The document discusses strategies for marketing and selling unbundled travel services, highlighting the differences between bundling for business travelers and unbundling for leisure travelers. It emphasizes the complexity that travelers face due to numerous ancillary service options and how technology and predictive bundling can enhance customer experience. The conclusion suggests that traveler frustration will catalyze changes in travel management and technology will play a vital role in adapting to these evolving needs.
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How to market and sell unbundled travel
- 1. How to Marketand Sell Unbundled Travel October 30, 2012
- 2. K Kevin May Gene Quinn Editor / Moderator CEO / Producer
- 3. Panelists Brian Beard Scott Gillespie Amadeus Author, Gillespie’s Guide Executive, Travel To Travel+Procurement Technology & Consulting Founder, Travel Analytics
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- 6. Predictive Bundling Scott Gillespie Author, Gillespie’s Guide To Travel + Procurement Founder, Travel Analytics
- 7. Types of AncillaryRevenues Flight-Specific Sources Other Sources • Bag Fees • Lounge Pass • Seating • Extra Miles/Points Airline’s • Priority Boarding • Booking Method Products • Food & Beverage • Payment Method • Entertainment • Pillows, Etc. Partner’s • WiFi • Car, Hotel Bookings Products • Catalog Sales • Destination Content, • On-Board Advertising e.g. Concert Tickets
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- 9. To Bundle, Or NotTo Bundle?
- 10. The Cost ofShopping High Cost To Traveler One Many Bundle Options Number of Choices Source: Scott Gillespie |
- 11. The Cost ofShopping High Cost To Traveler Cost of Unwanted Features One Many Bundle Options Number of Choices Source: Scott Gillespie |
- 12. The Cost ofShopping High Shopper’s Time Cost To Traveler Cost of Unwanted Features One Many Bundle Options Number of Choices Source: Scott Gillespie |
- 13. The Cost ofShopping High Total Shopping Cost Shopper’s Time Cost To Traveler Cost of Unwanted Features One Many Bundle Options Number of Choices | Source: Scott Gillespie
- 14. The Cost ofShopping High Total Shopping Cost Shopper’s Time Cost To Traveler Cost of Unwanted Features One Many Bundle Number of Choices Options | Source: Scott Gillespie
- 15. Bundling Makes SenseWhen High Shopper’s Time Is Very Valuable Total Shopping Cost Cost To Traveler Unwanted Features Don’t Cost Much One Many Bundle Number of Choices Options | Source: Scott Gillespie
- 16. Bundling Makes NoSense When High Total Shopping Cost Cost Unwanted To Features Cost a Lot Traveler Shopper’s Time Is Not Valuable One Many Bundle Number of Choices Options | Source: Scott Gillespie
- 17. General Conclusion • Bundlefor Business Travelers • Unbundle for Leisure Travelers
- 18. General Conclusion •Bundle for Business Travelers • Unbundle for Leisure Travelers Marketing Implications Fare Families
- 19. General Conclusion •Bundle for Business Travelers • Unbundle for Leisure Travelers Marketing Implications Fare Traveler Families Personas
- 20. General Conclusion •Bundle for Business Travelers • Unbundle for Leisure Travelers Marketing Implications Fare Traveler And Families Personas eventually…
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- 23. Predictive Bundling RecentPurchases Current Search Parameters - Dates, Destinations - Dates, Times, Destination - Cabin, Seat Choice - Number of Pax - Days Advance - Number of stops - Price, Booking Class Airline Status Corporate Link? Co-Branded OA’s Likely Credit Card Bundle? - Ancillary Fees 10/30/2012 23
- 24. Examples of Predictive Bundling •One Checked Bag •Priority Boarding •Window/Aisle Choice 10/30/2012 24
- 25. Examples of Predictive Bundling •One Checked Bag •Priority Boarding • Lounge Day Pass •Window/Aisle Choice •$20 credit for on-board F&B, Entertainment, WiFi 10/30/2012 25
- 26. Examples of Predictive Bundling •One Checked Bag •Priority Boarding • Lounge Day Pass •Window/Aisle Choice •$20 credit for on-board F&B, Entertainment, WiFi •Priority Standby for Upgrade •Best effort at empty middle seat • 50% off Change Fee, if needed 10/30/2012 26
- 27. Challenges of Predictive Bundling • Access to appropriate data sources – Facebook, Twitter, LinkedIn, Klout, etc. – Credit scores, purchase patterns • Drawing good conclusions about which bundles to present • Offering bundles at point(s) of sale – Online shopping sites (speed and accuracy issues?) – In the booking path – At check in – Via mobile phone • Potential conflict with corporate T&E policies
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- 30. Unbundled Travel Services Traveler Perspectives and Technology Impact © 2010 Amadeus IT Group SA Brian Beard, Executive, Travel Technology & Consulting, Amadeus
- 31. Unprecedented Complexity Proliferation of Choices Bags or No Bags Board early or take the risk Bring food Bring Wifi or take the risk Airline Frustration and Inconvenience ancillary Plane checked bags revenue Slow Wifi In your face advertising will Travelers expectations reach Know options ahead of time $36.1 © 2010 Amadeus IT Group SA Easy payment Billion in Listed in Itinerary 2012 Source: Amadeus and IdeaWorksCompany Press release
- 32. The Business TravelerDilemma Please remember me Services selected previously Basic preferences Last time I traveled My favorite bundle Expense or not Expense? Out dated travel policies Personal travel costs Expense systems The partially functional OBT Lacking travel products and services © 2010 Amadeus IT Group SA Completeness of the Itinerary Ability to change a reservation
- 33. Travel Manager PainPoints Travel Policies out of control A policy for every service Impacts of bundling Constant changes Reporting has become more difficult Lack of available Data Most US Reporting tool upgrades corporations Expense systems have yet to set policies Impact on supplier negotiations regarding Addition inputs ancillary Stability of unbundled services service © 2010 Amadeus IT Group SA May be too early to tell offerings
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- 35. Future Paths The supplier Direct solution The EMD Solution The supplier API solution Fare Families System Integration Data collection © 2010 Amadeus IT Group SA Earlier this year, Amadeus and IdeaWorksCompany reported the ancillary revenue disclosed by 50 airlines for 2011. These statistics were applied to a larger list of 176 airlines to provide a truly global projection of ancillary revenue activity by the world’s airlines in 2012. The Amadeus Worldwide Estimate of Ancillary Revenue marks the third year Amadeus and IdeaWorksCompany have offered a projection of global ancillary revenue activity.
- 36. Technology’s Role/Impact It’s all about Data Big Data, Small Data, timely data Access and Sharing Privacy and compliance Next Gen Booking tools Mobile and fully functional 5 Billion Evolution of the travel tool people will Power to the traveler have Social and More access to Unbundled product will be increasingly impacted by social input mobile broadband © 2010 Amadeus IT Group SA Multiple payment mechanisms will exist Apps become the new widgets by 2016
- 37. Conclusions Traveler frustration will drive change TMC’s must adapt to the increasing needs of the travel manager Leisure traveler’s will continue to have an increasing number of choices for travel products Technology will make selecting and tracking unbundled services easier Sharing data across the travel © 2010 Amadeus IT Group SA supply chain will be a key driver for change
- 38. with Amadeus Brighter, Bolder, Better © 2010 Amadeus IT IT Group SA © 2010 Amadeus Group SA
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- 40. Thank You! Please send your questions and comments to Kevin May, Please [email protected] Replay of today’s webinar and presentation will be available tomorrow at www.tnooz.com