Amadeus Insights
Contents
Amadeus Insights
Close
Conclusion
The evolution of Online Travel Agencies has reached a pivotal moment. Leaders in this space told researchers they are striving to provide an end-to-end trip planning, booking and servicing experience to travelers as they aim to become a ‘one-stop-shop’. Linked to this macro-objective is the desire to deliver a better experience.
Achieving this requires multi-faceted action. This research suggests Online Travel Agencies recognize greater investment in technology will be fundamental, as nine-in-ten Online Travel Agencies are planning to implement every new technology area suggested during the research, with average spend on technology set to grow by 13% over the coming 12 months.
But, even with this increased investment, there are likely to be competing demands as Online Travel Agencies tackle several important challenges.
Respondents told researchers they are still making improvements to the experience they currently offer, with improved search capabilities to incorporate new options like LCCs, hotels and NDC content being a key priority. Similarly, respondents are planning to boost self-service and empower their agents with better trip management technology. A significant minority of Online Travel Agencies plan to implement digital payments, machine learning and self-service over the coming year.
Automation
According to the research, a typical Online Travel Agency is set to automate a further 27% of its processes in the future, suggesting a major program of automation is underway across the sector. With respondents estimating that ticket changes currently account for 11% of their customer service resource, automation is a key near-term priority. The results of this study paint a mixed picture on NDC. While the vast majority of Online Travel Agencies value accessing and selling a wider range of airline products and services, the data shows that maturity varies across the sector. Indeed, when set against other priorities, NDC preparation was only cited as a priority by 21% of respondents.
The challenges
Two major challenges were identified by Online Travel Agency leaders. The first is the complexity of managing the multiple API connections needed to make NDC a reality. The findings suggest the sector would welcome aggregation to tackle content fragmentation and reduce the complexity involved in a multi-standard distribution world.
The second challenge relates to readiness of airline systems. Online Travel Agency leaders are concerned that, as airlines assume control over their underlying IT systems, they will struggle to fulfill the high volume of polling requests initiated by Online Travel Agencies. Here, new collaborative approaches are needed that protect airline systems from this polling while still ensuring the airline can package and make its content available in the way it chooses. At the same time as dealing with these current priorities, Online Travel Agencies have an eye on the disruptive potential of Generative AI. Some 40% of Online Travel Agency leaders think the technology will have a significant impact on the industry over the coming year.
Amadeus is responding
The way Online Travel Agencies acquire traffic has long been a point of contention in the industry. Traffic acquisition costs have steadily increased and are now one of the largest line items on the balance sheets of Online Travel Agencies. Generative AI offers a new route for Online Travel Agencies to place their offers and service in front of the traveler, without the costs associated with traditional search. At the same time, Generative AI holds significant potential to automate service and to enhance the core Online Travel Agency search experience.
The transformative potential is clear
How will Online Travel Agencies allocate their typically expanded technology investment budget between these current and disruptive priorities? The research suggests that the question will be the subject of discussion in many boardrooms across the industry.
© Amadeus IT Group SA