The travel industry is growing at a huge rate, with €98.1 billion spent online in this market. This is doubtless due to the increasing popularity of mobile devices. Among the younger generation almost 30% book holidays with a mobile device and Travolution predicts that 50% of travel bookings will be made on a mobile device by 2017.
Yet despite all of this good news, the travel industry is struggling, particularly with product accuracy and the high costs involved in inventory distribution and display.
So what is the main challenge that travel companies face?
Quite simply – they are unable to fully control their product data and there is currently no global solution that allows travel companies to control and distribute their data, thus making it easy for them to improve their efficiency and reduce their costs.
The travel industry is generally made up of three main groups: airlines, hotel chains and OTAs (online travel agents). The main issues that these three groups face are:
1. The amount of data they have to deal with
Advertisers have access to an awful lot of travel data, but there’s so much of it (e.g. flights, hotels, car hire) that they often struggle to make the most of it. The travel sector also tends to have a longer customer journey due to the research process, which often includes a variety of travel sites, e.g. price comparison and review sites. Data feeds can also become unmanageable if they include too many combinations of different products.
2. The costs associated with the distribution of this data
Some travel companies do have their own booking engines, but most do not. This means that they have to request availability from the GDS (global distribution system) each time there is a query from a consumer. It doesn’t matter how many people are looking for the same data – and there can be thousands of identical requests each day – the company incurs a cost each time it requests data. Travel companies also have to pay partners who send them traffic, usually on a CPA model.
3. The optimisation of the data to be distributed as per conversion results
As travel companies have so much data, it is almost impossible for them to control it and most do not have the internal resources to be able to optimise their data. By optimising data, travel companies can remain consistent in brand messaging across multiple channels. Optimisation is also essential for presenting relevant content to the consumers and ensuring that non-converting products (e.g. skiing trips in the summer) are not being displayed and causing unnecessary costs to the company.
So what is the solution?
Travel companies should be providing their affiliates with high-quality data feeds and innovative technology, so that they can be more creative with their performance marketing and enhance their overall results. According to Tradedoubler 71% of travellers look at performance marketing sites before booking a trip to ensure that they are getting the best price.[1] By creating unique solutions that enhance their online marketing campaigns travel companies will be able to adopt new channels and improve their success in the existing ones.
For example First Choice and Thomas Cook both provide affiliate tools so that their publishers can be more creative with how they advertise products online. Their affiliates can choose to display just travel products within a certain budget, or just flights and hotels relating to certain destinations. This not only makes the adverts more personalised to the affiliate’s target audience, but also makes them more engaging, which ultimately leads to an increase in clicks and conversions.
Travel merchants need to make sure that their product data is correctly segmented to ensure that it is consistent across multiple channels. The more comprehensive, accurate and consumable their product data is, the more likely it is to produce a decent return of investment.
Where costs are concerned, if travel companies want to save money then they need to cut out the middleman and cache their queries for a short period of time; by doing this the requested information can be reused and delivered to other consumers looking for the same information via different travel meta-search partners. This is possible because of the number of popular destinations which are searched frequently.
All data that is transformed and distributed to different partners, e.g. xml users, API users etc. should ideally be controlled from a single platform. This allows travel companies to allocate the right inventory to each channel, ensuring that is correctly mapped and categorised to the channels it is being integrated into. This makes the whole process of performance marketing far more efficient.