Thanks to the Internet, distant things and places are now more accessible than ever. There has also been a major shift in the needs and desires of consumers towards local and authentic products that have a history.
The travel industry is not immune to these changes. I have observed that a number of early stage travel companies challenge the well-established notion of “destination specialists”. These experts may have completed a training program or spent time in the destination to learn more. But that does not always mean that they are based full time in the destination; often these experts work with destination-based companies to make the trips. One of the ways this is changing is through the use of technology, which allows direct access to local destination-based businesses and eliminates these middlemen.
This is the idea behind my company’s luxury travel platform. As a founder, I’ve had the opportunity to work closely with both sides of the travel equation: on the consumer side, I’ve learned that travelers want authentic experiences planned by local experts; On the supply side, many local travel agencies in the destination that have traditionally worked with travel agencies (and tour operators) in home countries to acquire business now wish to be upstream and work directly. with the travelers themselves.
Let’s take a closer look:
Consumers want authenticity: Consumers today are very aware of the decisions they are making. They don’t just look for the best products; they also care about what a brand stands for. One of the ways I have seen this authenticity in travel advice and experiences develop is because an individual or a business based in the destination works directly with the end suppliers.
Technology platforms can enable access and collaboration: Platforms such as Uber and Airbnb, among others, have demonstrated the effectiveness of two-sided Software-as-a-Service (SaaS) marketplaces in removing middlemen while facilitating connections, communications and transactions between buyers and suppliers. According to an article by TechCrunch, “Marketplace networks” – a type of business model that combines online marketplaces, social networks, and a SaaS workflow – hold promise for the future. Putting it in perspective, imagine a travel collaboration where travelers, destination travel experts, hotels, ground transportation providers and tour operators are all within reach.
While the idea of market networks in the travel industry may seem a bit far-fetched, the platforms that organize and provide access to full-service local travel agencies and enable the entire end-to-end process. are not. My company offers this type of platform for luxury travel, and I have observed that there are also companies that do this for tours and activities, as well as tailor-made low budget travel.
Impact matters: In the absence of intermediaries, consumers work directly with experts and companies in the destination to plan their trips, which can affect the cost and the percentage of money left in local destination economies. In addition, it is possible to immerse oneself deeply in the local communities and to make a lasting impact which goes beyond sustainable and responsible travel by contributing money or time to local initiatives.
How to partner successfully with experts in the destination
That said, using experts in the destination presents some challenges for space executives to consider. First, according to Phocuswright, more than 80% tours and activities are always booked offline. Thus, the competition is stiff as everyone tries to partner with the best travel agencies and tour operators in the main destinations. Additionally, there is a need to educate executives (and local operators) on how direct consumer exposure affects their business.
The best way to overcome these challenges is to focus on a small geographic region based on your current regions of interest. If you don’t yet have an established relationship, it may be a good idea to consider a trade-off between low competition regions and high search volume trends. Important things to consider when selecting new non-referral partners from your network are travel industry affiliations, awards, and reviews.
In order to establish a competitive advantage, travel agencies also need to be radically transparent in how they control their partners and let travelers know who is making their trips.
It is also interesting to note that nearly 90% of consumers would be more loyal to an organization that supports environmental or social issues, according to a 2017 to study by Cone Communications on Corporate Social Responsibility. From my perspective, travel is inherently transformative, and travel agencies have the opportunity to pursue initiatives that support sustainable travel practices that positively impact destination economies. For example, you might suggest staying at an exemplary service store that hires and trains staff from local villages and follows eco-friendly practices to minimize your carbon footprint.
In this ever-changing consumer landscape with readily available technology, the market is ripe for disruption, and I believe the travel brands that are successful will be those that are able to create distinct product offerings and a competitive advantage.