- Consumer expectations will rapidly spill over from retail into travel distribution. Players in the travel distribution industry will need to respond with broad collaborations for aggregating, processing and harnessing the big data involved. Otherwise, the explosion of complexity and differentiation of services in the short term could translate into potential confusion for the consumer.
- The role of gatekeepers, the giant IT companies with major consumer interfaces, in travel distribution will continue to grow, notably through the use of virtual assistants, payment technologies and integration into social media.
- The size and power of ‘mega-meta-OTA’ hybrids (online travel agents with metasearch capabilities and global brands) are likely to continue growing. Consequently, their influence will penetrate deeper into the distribution chain, with the ability to negotiate better content and conditions, whilst still receiving commissions.
- The travel distribution industry is rapidly becoming a technology industry. Business models will need a more strategic approach that recognises the value creation of different technologies across the industry.
- To avoid consumer confusion and lost opportunities, industry distribution need to go beyond bilateral partnerships and contractual relationships. Distribution business models will need to evolve to encompass more shared innovation, a culture of experimentation and cross-industry alliances.
- Sharing economy platforms will continue to create new markets and erode the market share of suppliers and industry players who intermediate. The industry will need to adapt to this changing market and carefully monitor the impact of competition rulings in different regions as regulators play catch-up.
Travel distribution industry underestimates the speed and scale of the consumer revolution, says new LSE study
- October 11th, 2016
- Tomás Monge
Gatekeepers, ‘mega meta online travel agencies’, and artificial intelligence may fundamentally disrupt the future of travel distribution, says a new independent study by the London School of Economics.
The report was commissioned by Amadeus, and insights are drawn from business leader interviews, data analysis and a major sector-specific survey spanning all global markets.
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- Oct 11th 2016
Travel distribution faces a range of potentially huge disruptions over the next 10 years that will significantly impact industry players and their business models.