How to market and sell unbundled travel
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How to market and sell unbundled travel

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This webinar, produced by Tnooz and Amadeus, examined new traveler behavior, the effects of unbundling services on business models and how suppliers manage the marketing opportunities and ...

This webinar, produced by Tnooz and Amadeus, examined new traveler behavior, the effects of unbundling services on business models and how suppliers manage the marketing opportunities and challenges.

Panelists for this FREE webinar were:

Brian Beard, executive technology consultant, Amadeus
Scott Gillespie, travel industry consultant, Gillespie's Guide to Travel + Procurement
Gene Quinn, CEO and producer, Tnooz
Kevin May, Editor and moderator, Tnooz

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How to market and sell unbundled travel How to market and sell unbundled travel Presentation Transcript

  • How to Market and Sell Unbundled Travel October 30, 2012
  • KKevin May Gene QuinnEditor / Moderator CEO / Producer
  • PanelistsBrian Beard Scott GillespieAmadeus Author, Gillespie’s GuideExecutive, Travel To Travel+ProcurementTechnology & Consulting Founder, Travel Analytics
  • Poll no. 1
  • Poll no. 2
  • Predictive BundlingScott GillespieAuthor, Gillespie’s Guide To Travel + ProcurementFounder, Travel Analytics
  • Types of Ancillary Revenues Flight-Specific Sources Other Sources • Bag Fees • Lounge Pass • Seating • Extra Miles/PointsAirline’s • Priority Boarding • Booking MethodProducts • Food & Beverage • Payment Method • Entertainment • Pillows, Etc.Partner’s • WiFi • Car, Hotel BookingsProducts • Catalog Sales • Destination Content, • On-Board Advertising e.g. Concert Tickets
  • 10/30/2012 8
  • To Bundle,Or Not To Bundle?
  • The Cost of Shopping HighCostToTraveler One Many Bundle Options Number of Choices Source: Scott Gillespie |
  • The Cost of Shopping HighCostToTraveler Cost of Unwanted Features One Many Bundle Options Number of Choices Source: Scott Gillespie |
  • The Cost of Shopping High Shopper’s TimeCostToTraveler Cost of Unwanted Features One Many Bundle Options Number of Choices Source: Scott Gillespie |
  • The Cost of Shopping High Total Shopping Cost Shopper’s TimeCostToTraveler Cost of Unwanted Features One Many Bundle Options Number of Choices | Source: Scott Gillespie
  • The Cost of Shopping High Total Shopping Cost Shopper’s TimeCostToTraveler Cost of Unwanted Features One Many Bundle Number of Choices Options | Source: Scott Gillespie
  • Bundling Makes Sense When High Shopper’s Time Is Very Valuable Total ShoppingCost CostToTraveler Unwanted Features Don’t Cost Much One Many Bundle Number of Choices Options | Source: Scott Gillespie
  • Bundling Makes No Sense When High Total Shopping CostCost UnwantedTo Features Cost a LotTraveler Shopper’s Time Is Not Valuable One Many Bundle Number of Choices Options | Source: Scott Gillespie
  • General Conclusion• Bundle for Business Travelers• Unbundle for Leisure Travelers
  • General Conclusion • Bundle for Business Travelers • Unbundle for Leisure Travelers Marketing Implications FareFamilies
  • General Conclusion • Bundle for Business Travelers • Unbundle for Leisure Travelers Marketing Implications Fare TravelerFamilies Personas
  • General Conclusion • Bundle for Business Travelers • Unbundle for Leisure Travelers Marketing Implications Fare Traveler AndFamilies Personas eventually…
  • With RichCustomerProfiles…
  • Predictive Bundling10/30/2012 22
  • Predictive Bundling Recent Purchases 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 Fees10/30/2012 23
  • Examples of Predictive Bundling•One Checked Bag•Priority Boarding•Window/Aisle Choice10/30/2012 24
  • Examples of Predictive Bundling•One Checked Bag•Priority Boarding • Lounge Day Pass•Window/Aisle Choice •$20 credit for on-board F&B, Entertainment, WiFi10/30/2012 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 •Priority Standby for Upgrade •Best effort at empty middle seat • 50% off Change Fee, if needed10/30/2012 26
  • 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
  • Poll no. 3
  • Poll no. 4
  • Unbundled Travel Services Traveler Perspectives and Technology Impact © 2010 Amadeus IT Group SABrian Beard, Executive, Travel Technology & Consulting, Amadeus
  • 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 2012Source: Amadeus and IdeaWorksCompany Press release
  • The Business Traveler Dilemma  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
  • Travel Manager Pain Points  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
  • Poll no. 5
  • Future Paths  The supplier Direct solution  The EMD Solution  The supplier API solution  Fare Families  System Integration  Data collection © 2010 Amadeus IT Group SAEarlier this year, Amadeus and IdeaWorksCompany reported the ancillary revenue disclosed by 50 airlines for 2011. These statistics wereapplied to a larger list of 176 airlines to provide a truly global projection of ancillary revenue activity by the world’s airlines in 2012. TheAmadeus Worldwide Estimate of Ancillary Revenue marks the third year Amadeus and IdeaWorksCompany have offered a projectionof global ancillary revenue activity.
  • 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
  • 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
  • with Amadeus Brighter, Bolder, Better© 2010 Amadeus IT IT Group SA © 2010 Amadeus Group SA
  • Q&A
  • Thank You! Please send your questions and comments to Kevin May, Please kevin@tnooz.comReplay of today’s webinar and presentation will be available tomorrow at www.tnooz.com