Can you keep up?

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The last decade has shown that there’s a natural fit between technological advancement and an industry such as the global travel industry, which has proved that it has the platforms to fully utilise the benefits that a more tech savvy environment offers. That being said, how is technology and the role it plays being viewed by those at the coalface, asks Dylan Rogers?

It seems almost impossible to even conceive of a society or lifestyle without the significant influence of technology, taking into the account the reliance we now have on the likes of mobile phones and the internet.

In fact, just stop – and that includes looking away from your phone – for a minute and consider a life without these two tools.

Almost impossible, isn’t it?

I mean, life without the internet and only a land line telephone for telephonic communication just seems like a world away, even though people of a certain age can remember a time when this was what you had to make do with. I can certainly recall the start of my working life in the mid to late-1990s, when I was required to share a PC with more than one work colleague, the internet was barely a blip on my radar, and I was handed my first mobile phone – never mind that it was months before I learnt how to send a text message!

That’s only 20 years ago, which is a reminder of just much technology has developed and evolved in the past two decades.

The travel industry has been a great adopter, and whilst those on the supplier side of the relationship will argue that there is no substitute for good service and the personal touch, there is no doubt that the overall travel experience has been greatly improved, thanks to the advent of various forms of technology.

So, just who is making the most of it, who is being left behind, and very simply, who is utilising technology in the smartest way possible, to ensure that the travel experience is as seamless and convenient as we believe it can be?

More importantly, what’s the attitude towards technology and how is it being viewed by those offering it to travellers, travel agents, TMCs and corporate clients?

SHARING ECONOMY

Perhaps, before we look at who is ahead of the curve, it’s worth touching on a theme or element that is quickly becoming a bigger and bigger part of our lives, and is arguably one of the biggest talking points in the technology space, particularly as it relates to travel.

That’s because, from a corporate travel perspective, it’s clearly giving managers and policy makers plenty to think about, and this segment of the industry, as it stands, doesn’t appear to have worked out just how to integrate it.

I am, of course, talking about the sharing economy, a space currently dominated by the likes of Uber and Airbnb, two of the most high-profile players in the space, and two players that are having a material impact on the car rental and accommodation segments.

According to DMR, Uber is currently in approximately 400 cities and 70 countries, and averages around a million trips every day, which makes it virtually impossible not to have had an impact on the car rental industry. Airbnb, meanwhile, currently has approximately 2.3 million listings, and is already giving the hotel industry something to think about.

But that doesn’t mean the corporate travel sector has rushed into working the sharing economy into its systems.

“To some extent, the evolution of the sharing economy is reminiscent of the emergence of low-cost carriers some 15 years ago,” says Pine Nel, Chief Information Officer at Carlson Wagonlit Travel South Africa. “Although quickly adopted in the leisure sector, traction in the business space (where programme integration and compliance are still major factors) has been slower.”

There’s no doubt that compliance with travel policy is one of the major sticking points, but is that a good enough excuse?

“The successful providers of online travel solutions to business travellers will be those companies that can offer their customers the largest, widest range of relevant content to meet the needs of the specific trip,” says Philip Katz, CEO of Tourvest’s TravelIT, a technology platform that focuses on driving down costs, ensuring policy compliance, and automating administration and reporting.

“The content currently provided by the GDS operators only accounts for 60% of total bookings today,” says Katz. “We estimate that it will be less than 40% in two years’ time. The business traveller will definitely require the content offerings of Uber and Airbnb-type services.”

Katz goes on to say that customers need to be made aware of the risks and shortfalls of their booking choices, and there have been some concerns regarding the safety of travellers who opt for sharing economy services over ‘traditional’ offerings. Quite simply, from a TMC point of view, it’s all about duty of care.

“Internationally, corporations are embracing Uber and Airbnb, however they have recognised the safety and security risks that these tools present,” says Frank Palapies, Wings Travel Management COO: Africa & Middle East. “In terms of duty of care, all traditional service providers must adhere to a minimum standard of safety and security, and similarly service providers within the sharing economy must also.”

Certainly something for Uber and Airbnb to think about, but whilst the point is well made, surely corporate travel policy makers just have to find a way to work sharing economy services into policy? That’s because it’s abundantly clear that these services just aren’t going away, others will join the space, and the sharing economy is going to continue playing a bigger and bigger role in business travel going forward.

TMCs

With times as tight as they’ve ever been, most TMCs will tell you that they are being placed under more pressure than ever to deliver a quick, efficient and cost-effective service, together with all the added requirements of managing the procurement process.

No surprise that they are turning to technology to achieve these efficiencies.

“Travel consultants cannot meet the needs of their customer without the use of the latest integrated technology solutions,” says Katz. “The modern TMC needs to be an expert in travel and technology to deliver a world-class and efficient customer service.”

The challenge for the TMC is that their technology solutions need to solve and address a whole bouquet of potential problems and challenges, with requirements such as quoting, policy compliance, content aggregation, approval and authorisation processes, reconciliation, crisis management, duty of care, and mobile integration, just to name a few. This requires a not insignificant investment in technology and training, and the TMC has to ensure it services the needs of both traveller and corporate client.

“Corporate travellers are often faced with a dichotomy in that the empowerment (derived from technology) experienced in their personal travel is not being mirrored when travelling on business,” says Nel. “There may be an understanding that the company derives value from the travel programme, but this need not be to the detriment of the traveller. Our customers expect us to leverage technology to close this gap, to deliver the absolute best of both worlds.”

Palapies touches on another developing theme.

“The traveller expects a more intuitive service from their TMC – anticipated and assumed travel intelligence,” he says. “TMCs and corporates are taking this intuitive service into consideration with a focus on the ‘bleisure’ travel trend, and on how to manage the expectations of millennial employees.”

Those ‘milennial employees’ are the business travellers of tomorrow, and there’s no doubt that they march to the beat of a different drum. What is also clear is that the mobile device is central to their existence and TMCs and corporates have to find a way to service this emerging group of travellers through their device of choice.

“Mobile platforms are all about engagement – data driven, contextualised and cross platform one on one interactions through every step of the travel process,” says Nel. “Failing to engage and automate beyond the travel reservation process will systematically see you fade into irrelevance. It is all about being there for the traveller.”

Wings Travel Management currently offers its GoData product, a mobile-enabled business intelligence tool that allows clients to retrieve reports on the move, drilling down their travel data and giving them access to a range of information. According to Palapies, Wings is looking to take that a step further.

“We’re working towards ensuring that all technology product offerings are adapted into the mobile space, and we’re preparing our systems to be ready for integration into existing workflows, particularly within the HR and finance functions of our clients’ businesses.”

But which is more important? Developing mobile technology to drive seamless internal processes or  focusing more on how it can assist the actual traveller and his or her journey?

“Mobile technology is a natural part of the ongoing journey of self-help and automation within the travel industry,” says Katz.

Katz goes on to identify a couple of key areas in which mobile technology can address customer requirements, such as quick access to travel documents and itineraries, Google Maps, instant alerts and notifications, whilst he has an interesting take on where mobile corporate travel bookings currently are.

“The requirement to make a new business travel booking online, directly from a smart phone, is currently low, but will grow over time into a major new channel for bookings,” he says.

It’s difficult to disagree with Katz’s last assertion, and there can be little doubt that TMCs are going to have to keep developing products that are mobile-integrated and up to speed with regards their clients’ expectations and traveller behaviour.

GDS

Katz didn’t paint a rosy GDS future when he stated that he believed that in two years’ time GDS operators would only account for less than 40% of all travel bookings. That probably explains why the world’s big GDS companies have over the last few years positioned themselves as travel technology experts and thought leaders, as opposed to merely the providers of a GDS platform.

That being said, there’s no doubt that the GDS companies are big players in the global travel space and often at the cutting edge of industry-leading travel technology. But, as with TMCs, there are so many potential touch points.

So, I’m interested to know what the biggest and most talked-about issues in the GDS space are, according to the big players in Africa?

“Corporate payment solutions,” says Jannine Adams, Senior Manager Marketing at Amadeus Southern Africa. “It is essential to understand which payment solutions are needed and to create the perfect solutions for the African market.”

And what about Travelport, the other GDS company with sizeable market share in Africa?

“Merchandising is the number one talking point,” says Douglas Jewson, Travelport’s Managing Director: Africa. “Airlines need the most innovative products and services to distribute to keep on top of trends, display and sell every type of fare and optional service in any business channel, and tailored distribution technologies need to easily integrate with airline internal reservation systems, to improve the effectiveness of distribution strategy.”

Previously, connectivity has been a challenge in Africa, but as the continent’s governments realise the potential it can have on development, as well as impact on economic growth, so broadband access has improved and groups of emerging tech entrepreneurs have emerged.

Countries such as Kenya – with its M-Pesa payment technology – and Rwanda are leading the way.

“Africa is a fascinating region, because in many ways it leapfrogs the iterative technology steps that other regions go through,” says Jewson. “For example, electronic, virtual payments are already commonplace in countries like Kenya and that country is one of the top countries in the world for mobile payment readiness.”

“The African traveller’s attitude towards technology is that technology needs to be simple and practical,” says Adams. “They don’t want long drawn-out projects to implement the solutions they need. They want easy solutions that work and that are available on mobile.”

Speaking of mobile, it’s no surprise to hear that the GDS companies are investing heavily in it, as their offering evolves and they look at new potential areas for growth.

“In future, mobile is no longer something that should be considered just as being a different channel,” says Adams. “Mobile is becoming part of every transaction.”

According to Adams, Amadeus is in the process of delivering an online booking solution that is entirely compatible with mobile. No app is required, and this solution, she says, offers the same booking platform whether it is accessed from a desktop or a mobile device.

“Travelport has invested in its mobile offering to allow our customers to interact directly with travellers, which is becoming increasingly significant in this hyper connected world,” says Jewson.

That being said, Travelport’s Managing Director: Africa is quick to remind everyone that whilst technology has materially changed the travel experience, the travel agent, an important Travelport customer, still has a role to play.

“Travel agents add value for their customers by providing a ‘personal touch’,” says Jewson. “That’s something that should never be underestimated and will always be relevant.”

Worth bearing that in mind, as we give our lives over to technology.

AIRLINES

Technology advancement has had an impact on two main areas in the airline space.

Firstly, the customer interface and the streamlining of the travel process for the actual traveller, and secondly, the improvement of internal operational processes and functionality, which the traveller doesn’t always see.

In this area, British Airways is one of the market leaders.

“By way of example, pilots used to have to carry at least two large bags of manuals and charts,” says Sue Petrie, British Airways Commercial Manager for Southern Africa. “Printouts of fuel and load control figures were brought to the cockpit manually by someone running up a flight of stairs. Now, captains have every chart in the world on their iPads and all the information they need is communicated electronically directly to the aircraft’s computer system. Removing all this has resulted in a fuel saving of one tonne per long-haul flight.”

From an actual traveller point of view, the greatest technological advancements – as it relates to airlines – have been made in the app space, changing our approach to bookings and the documentation that results from that.

“For business travellers, being able to book a flight, view upcoming flights, check in and choose a seat, download a boarding pass or multiple boarding passes, and get gate notifications and lounge wi-fi password directly to their phones, is like travelling with a virtual personal assistant,” says Petrie.

BA, though, are taking it a fair number of steps further.

Future BA innovation includes a feature that tracks your location and lets you know how much time you have to get to the boarding gate and if you are running late. It will even factor in your average walking speed and let you know if you should speed up.

Among the other ideas that BA is investigating is reusable electronic bag tags, which would be synched with the boarding pass on your mobile phone. There’s also an ambitious plan to have an electronic version of your passport on your smartphone, which is still subject to regulatory approval, whilst BA is also trialling something internally called AirPortr. This luggage logistics service collects your bags from home and delivers them to the carousel at the final destination. Operationally, also in trial phase is a Mototok product, which is a smaller, cheaper, more eco-friendly remotely controlled version of the conventional pushback tug.

“We’re using technology across every aspect of our operation and it’s constantly evolving,” says Petrie.

That includes BA looking into onboard wi-fi. The IAG group is currently talking to suppliers about providing wi-fi connectivity on the group’s long-haul aircraft, whilst IAG has already announced that it has signed a memorandum of understanding with Immarsat to look at short-haul wi-fi connectivity.

This is currently a competitive and much talked about space, with the world’s top airlines taking different views on when and where to go this route.

Delta recently completed the roll-out of wi-fi on its international fleet.

“The very fact that people use our wi-fi system every day proves that travellers – business and leisure – both want and need to be connected,” says Jimmy Eichelgruen, Delta’s Sales Director for Africa, Middle East & India. “Business travellers have deadlines that won’t wait until they reach their destination, while Millennials want to post about their flight experience on their social media channels. The world is getting smaller and business is becoming more demanding, therefore people will choose a wi-fi enabled flight over one that is not.”

HOTELS

As with airlines, both the guest experience and operational efficiency have been improved thanks to technology, and it’s been interesting to see who the early adopters have been, particularly in the guest space.

Sure, there’s the booking process and the roll-out of hotel group apps, but which of the big players out there are really going the extra mile, as it relates to innovative in-room technology, wi-fi, payment solutions and security?

“To meet escalating guest expectations, 54% of hotels will spend more on technology this year, according to HT’s 2016 Lodging Technology Study,” says Hospitalitytechnology.com’s Lisa Terry. “Their biggest priorities for technology spending, in order, are: payment security, guest room tech, bandwidth, and mobile engagement.”

According to Terry, mobile solutions will dominate the list of capital investments this year — six of the top new rollouts have a mobile component, ranging from mobile keys, to mobile payments, to location-based technology. Also high on to-do lists are improving data accessibility and security.

Terry goes on to identify six ‘mega trends’ for 2016 in the hospitality space, namely: mobile ubiquity; integrating mobile data; enabling guestroom tech; future-proofing networks; beefing up security; and energy conservation.

Marriott and Starwood are arguably two of the market leaders in the hospitality tech space and it’s going to be fascinating witnessing the technological integration of these two big groups, following Marriott’s recent acquisition. Certainly, I’m expecting significant development, particularly in the mobile space. Starwood were one of the early adopters of the keyless room entry system, whilst Marriott have made it clear that mobile is a big part of their strategy.

“The use of mobile serves both as a driver of greater revenue and as a means of improving the guest experience,” says Neal Jones, Chief Sales & Marketing Officer, Middle East and Africa, Marriott International.

That is certainly the case in Africa, with many travellers completely bypassing the desktop in favour of a mobile device, meaning hotel operators on the continent need to have an offering that speaks to this tech-savvy market.

“Mobility is not only the future, but has become the everyday expected norm,” says Jaco Albertse, Peermont Group Hospitality Systems Manager. “Peermont have embarked on multiple projects where mobility has been at the forefront. For example, Zapper mobile application payment solutions are available at two of our flagship restaurants and QR Code links, online comment forms and real time response is very much a reality when it comes to how our valued guests are able to communicate with us.”

New virtual card technology

South Africa’s Absa Bank is making a big play in the virtual card space with a solution it believes will keep procurement and travel managers happy.

Absa’s Virtual Pay product is a banking solution that integrates with most corporate procurement solutions and travel booking tools through an API, and it allows a procurement system and travel management company and/or booking engine to seamlessly create virtual cards with various levels of control, that reduce  fraud and abuse, or misuse, of those virtual cards to zero.

“It’s an easy process and the virtual cards are then distributed electronically to the supplier and travel and entertainment sector,” says Riaan Van Niekerk, Absa Head of Commercial Credit & Prepaid Issuing for Absa Card. “Because it integrates into a global distribution system that travel agencies use, it allows for 100% matched data to the user of Virtual Pay. This changes the landscape on how the T&E industry is going to make and receive payments.”

“With Virtual Pay, Absa is leading the field of virtual cards, because we have created a product that addresses the main concerns procurement and travel managers encounter – matching data, an easy-to-use system, opportunities to save money, and an increased level of security aimed at reducing fraud and card abuse.”

2016 travel technology trends

Scott Gutz, President & CEO of Amadeus North America made these predictions in January, and as we near the end of 2016, it’s interesting to see how those predictions have shaped up, with Gutz listing these six trends as the big travel technology trends of the year:

  1. So goes the traveller, so goes the industry
    The most important figure in 2016 will continue to be “I, Traveller”, the empowered traveller around whom the travel technology focus will revolve.
  2. Which way is up – challenging the status quo
    Disruption will be a given. Collaborative consumption and the sharing economy will grow, enabling individuals to rent or borrow goods and services rather than buy or own.
  3. Privacy, personalisation and the end-to-end trip will characterise corporate travel
    Airlines and corporate travel providers will further advance their use of business intelligence and data in 2016.
  4. Leveraging tech to evolve business
    Airlines especially will engage new technology solutions that help them advance the passenger experience, increase top line revenue and manage costs and efficiencies “below the wing.”
  5. The retailing revolution marches forward
    Merchandising will become a bigger opportunity for the entire industry in 2016.
  6. Artisans of the travel experience
    Travel professionals will continue to deliver value as travellers swap their DIY frustrations for the expert’s touch.

CONCLUSION

As Sue Petrie of British Airways puts it, “technology is moving so fast that standing still is not an option.”