Ever since the wide spread adoption of online travel agencies for travel planning and booking in the early 2000’s, hotels and other accommodation providers faced the challenge of maintaining the power over selling their rooms. But the emergence of mobile in travel opens up a new threat for hoteliers: The power over up-selling auxiliary services and other in-destination activities (Skift).
MOBILES IMPACT ON DAY-TO-DAY OPERATIONS
The mobile reach of the big OTAs opens up a new opportunity for them to expand their portfolio of sellable services. Due to the fact that travellers can be reached easily via OTAs’ own apps, the range of offers could be expanded towards providing services also during the travel stage. A potential scenario could include an OTA app that would allow visitors to check-in upon arrival (thereby bypassing the typical ‘front desk’ check-in experience entirely), upgrade their room, add breakfast, make dining reservations, book tours and activities or order further additional services. Thus, hotels will face new competition in one of their core business areas, namely servicing customers during their stay.
STRATEGIC REPOSITIONING OF OTAs
The first signs of this development already appear on the horizon. The review portal TripAdvisor for instance is set out to own the entire travel cycle. In addition to providing reviews, inspiration and hotel meta-search, it strives to position itself increasingly as an in-destination concierge as well. Expedia on the other hand, reserved plenty of space for tours and other in-destination experiences in its recent re-design of the website, thereby reinforcing the expansion towards further stages of the travel cycle.
TECHNOLOGY DRIVEN SHIFT
This shift in strategy, away from an emphasis on specific stages of the travel cycle (e.g Review services for inspiration and post travel sharing, OTAs for consideration and conversion, etc) towards a more holistic approach of covering the entire travel experience, is both driven and determined by developments in technology, in particular mobile technologies. Location based services, geo-fancing and increasingly sophisticated recommendation systems, provide all the information a travel agency would need to deliver meaningful and personalised service offerings that meet tourists’ needs during their stay. It is therefore time for hoteliers to account for this upcoming shift in the competitive landscape within their strategic decision making.
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