Top 10 Travel Technology Trends for 2009

With 2009 in full swing, PhoCusWright takes a fresh look at the technologies and innovations that have the potential to drive change in the travel, tourism and hospitality in its annual publication, PhoCusWright’s 2009 Technology Trend Predictions.

Thoughts// Another thorough report from PhoCusWright on technology trends for the upcoming year.  While the report is solid, it is a little deep…even just the highlights…and you just want to know ‘what does it all mean?’  A lot of articles have featured the ten trends, but without the clarity of the full report how should you read or address these trends?  Well, we have answers…at least, our own answers.

PhoCusWright’s 2009 Technology Trends

Despite Market Woes, Pockets of Investment Still Exist
“During economic downturns, innovation is the single most important condition for transforming the crisis into an opportunity.” (Sami Mahroum, Research Director of Britain’s National Endowment for Science, Technology & the Arts and a Visiting Reader at the School of Management, Birkbeck College, University of London) [IN].

Let’s start simple.  A lot of people, including myself, see the current climate as an opportunity.  Those people will continue innovating and be better prepared to take advantage of the recovery.

The Entire Trip Experience Will Be “Informationized”
In the past, the main focus of the travel value chain has been those components that resulted in a booking. Access to further information was a challenge because of limitations of mobile devices, lack of acceptable technology in hotel rooms, language barriers and no clear business model. This is all about to change.

The amount of information created, shared and distributed grows exponentially each day and with new technology (your iPhone) and standards we are able to interact with this information at more points during our day.  This creates the opportunity for travelers to interact with this information while on vacation, rather than simply pre-trip, opening up more opportunities for ROI.  Even in the most basic terms, a lot of consumers are now traveling with either a laptop or smartphone, and are able to connect with this information.

Software as a Service (SaaS), Cloud Computing and Open Source Spawn a New Flock of Innovators
Open Source has matured to the point that many companies are fully dependent on it. It has become an enabler for startups, allowing them to rapidly accelerate their time to market. At the PhoCusWright’s November 2008 Travel Innovation Summit, demonstrator Home and Abroad explained that they would not have been able to bring their product to market if it had not been for Open Source.

Ah, a bit more complex.  But something that will affect all of us.  A basic example: 10 years ago, if you wanted to start a large website you needed to spend a lot of time thinking about servers, hosting and bandwidth.  Plus, you had all of that overhead…literally rooms full of hardware.  SaaS, Open Source and specifically cloud computing, allow you to run that same website with much less overhead, thereby, reducing costs.

Suppliers (Finally!) Provide Personalized Shopping/Booking Tools
Today, most OTAs look much the same: Where do you want to go? When? Air only or hotel and/or car? To provide convenience and value to the customer, future learning and shopping screens will adapt to the users’ stated profiles, observed profiles and shopping style. Similarly, the content presented will be the most meaningful to the customer.

Finally!  We all know what needs to be done, but the challenge has been technology…or perhaps, lack of motivation.  Now, with all OTAs looking to maximize ROI, perhaps another round of innovation is possible.  If nothing else, realize that personalization and segmentation…beyond simply adding ‘Hi Jim’ to your emails…will be crucial to your marketing message over the next 5 years.

Technologies Will Continue to Converge
Ten years ago, television networks were distinct from the Internet. Video was limited to TV and you went to see a movie at the theater. Now you can make a phone call anywhere to anywhere in the world using your laptop. You can watch movies and TV and browse rich content on your mobile device. You can watch content from the Internet on your TV and wirelessly network your house for all manner of content.

Phones are now MP3 players, Mp3 players are now phones and both of them can take pictures.  Plus, all of these devices can access your information.  Time to stop thinking about your content as ‘for TV’ or ‘on the website,’ content is becoming centralized and pulled into a variety of devices, rather than being pushed to them.  Your content is at the center of your marketing wheel, with TV, radio, web, mobile, social, print, etc, etc, etc as the spokes to the consumer.

A Flood of New Mobile Travel and Location-Based Applications Come to Market
Mobile usage in travel applications has languished for years with a poor technology capability and an even worse business model. The mobile platform finally has interactive capability that makes it the fully functioning “3rd screen” alongside the desktop and laptop. With the growth of 3G (broadband wireless) subscriptions and smartphone adoption, apps will embrace location and context in a new way, enhancing the travel experience.

More than anything else, GPS location data in your phone is the ultimate piece of information for the travel-related organization.  Knowing if you are standing outside of a restaurant and being able to provide a coupon to your phone is the perfect CPC campaign.  Phones are becoming smarter, faster and cheaper.  The iPhone has introduced entire generations to technology…most of them, older.  More Americans own a cell phone than a house phone.  Oh yes, the entire world is going mobile and you better be ready…refer to our thought above.

Advertising Technology Transforms Travel Distribution
Pure play booking fee models will become dinosaurs as blended models involving highly targeted ads, referral fees and fees for service establish peaceful coexistence. The technology convergence discussed in Trend 5 will enable the convergence of business models.

Think of it this way, rather than charge a flat booking fee for everyone, the introduction of personalization and segmentation will allow greater knowledge about the consumer, which leads to better conversion and a higher fee for the quality consumer.  Quality over quantity.

Still Searching…for Better Search
Last year the trends were “Semantic Technology and the Semantic Web will drive the next wave of Internet technology” and “Search will evolve to become more effective.” These are still true. Lack of adoption of the formal semantic Web does not mean that search is not getting better. There are several instances where semantics are being used to improve search. As they begin to show differentiated business value over normal search, they will gain traction.

Web 3.0 is coming.  Smarter search is coming.  In the meantime, the current search technology has already progressed at an impressive rate…but we always want more.  Trust us, Google is working on it.

Democratization of Supply Levels the Playing Field
In the beginning when the airlines created travel distribution, the GDSs (they were called CRSs then) controlled the distribution of travel content. This created an oligopoly. But times are changing. The implementation of standards for interconnection, the transparency of the Internet, Web services and mashups, new search tools and SaaS models have all contributed to the development of an open marketplace for travel distribution.

We will leave the GDS debate to the experts, but the trend here is consistent with the larger idea that consumers have greater control over content…in this case travel distribution.

Business Intelligence and Analytics Move to the Forefront
In tight times, you need to squeeze as much as possible from your existing operations and capabilities. This involves understanding what your competitors are doing, how efficient and effective your own operations are and what your customers are saying.

For many of us, the love affair with the internet is over.  No longer can we be impressed by charts, graphs and big numbers.  We want to know what they mean, how they are affecting our business and which ones we should look at.  Web statistics are (or should be) common place, we now want the analytical point of view to ensure we are spending our budgets wisely.

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