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Posts tagged ‘Travel’

The Changing Face of Startups in APAC

October 28, 2014

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The 4th Annual WIT Bootcamp was so overflowing they had to change venues at the last minute to accommodate the additional people attending. As WIT is now celebrating its 10th Birthday it is relevant to reflect on the changing face of startups in Travel in Asia.

Speaking with several of the attendees, speakers and pitchmen during the sessions – I was impressed with the maturity and the focus on the important elements of what will make a success of their business. From the audience there were a number of investors on the hunt for good startups. A happy marriage one would hope. However let’s not get all soft and gooey about it. I am sure that many wil write about the detailed nature of the individual pitches being made and winners (or losers). You will be able to follow that on #WIT2014. My focus here is on the underlying current of the startup world.

Asia has matured and evolved from being the wide eyed follower to the pragmatic – where should the local investment community be spending their money and the business areas to be followed?

Allow me to start with some of the silly things.

If I see another Taxi hailing app – I think I will probably puke. The very idea of having a taxi app that gets you a taxi tells me several things.

  1. The Taxi companies have been woefully inadequate.
  2. There is not enough money in taxis to make a living off the hailing app.
  3. There will be a race to the bottom in price.
  4. Investors can be really stupid.

it seems that everyone in the investor community needs to have 2 things to be hip and cool. A home-stay app and a taxi hailing app.

Fortunately on the positive side – I see some real appreciation for the challenges (and opportunities) to use the cash floating around Asia to good use. Here are some areas I see startup entrepreneurs looking at.

Air Search, Planning and Booking.

Yes that old chestnut. its STILL not done well and there is still a lot of opportunity to address better ways of servicing the customers

Hotel Search, Planning and Booking

Surprising with all the possibilities this is not really well done. The plethora of Hotel booking apps just shows how bad the back ends must be.

Travel Planning.

Sadly I think some still believe that there is money in pursuing the passion. Let me set your mind straight here. There is NO MONEY in Travel Planning. But please keep these ideas coming its a lot of fun to see them

Local Activities.

Darn it… why can’t we get this right? Surely Viator is not the only answer. I think there is a lot of work to be done here and with each variation a clearer picture emerges. But there are no winners here and there are a LOT of pretenders.

Non-Air Transportation

During the WIT Startup pitches – I counted 4 times that Rome2Rio was mentioned. Clearly the Australian company led by Viator’s founder – Rod Cuthbert – has found the right niche and this is a really valuable piece of kit. As a long time map/Geo-spatial aficionado – I am really pleased to see this get handled right. The ground transportation market still suffers a great deal. Too many options and too little scale. I think there are nice ideas out there. Rome2Rio can power a lot. Will there be a clear winner? The jury is still out.

So Timothy is there still a place for some smarts outside of this group?

Actually I am glad you asked. I see that we have a really tough challenge in the financial settlement and fulfillment process. In the APAC region ApplePay is not going to be that solution for a while if ever. Regulatory confusion and conflict is holding things back particularly in the cross border world of international travel.

I hope that by next year’s WIT Bootcamp I will see players working on this

Cheers.

Travel Is NOT About Branding

January 3, 2014

VaultPad

Conventional wisdom says that branding is really important. It drives higher value, promotes loyalty. etc etc.

Well in the USA that doesn’t seem to be the case. Travel is a chronic under-spender in the category of advertising. But worse how its spent shows that the US at least has totally wasted a significant amount of its ad spend by going after direct response. In airlines that probably means that branding on the planes is irrelevant.

Have a look at this chart. This is from eMarketer. Its scary in its direct numbers.

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Let’s look at the context. Travel is 5% of the total US GDP. The US GDP in 2012 was $15,684.80 billion US dollars in 2012 http://www.tradingeconomics.com/united-states/gdp . Travel’s value was $855.4 billion http://www.ustravel.org/sites/default/files/page/2009/09/EconomicImpactTravelandTourism2013update.pdf. Travel as a category represented 8% of the total ad spend so as a category it punches above its weight.

This should help put to rest whether price matters. Of course it does and price advertising in Travel is the door opener. If you dont tell people you have a price deal that they can assess in the opening moments of their decision process – you WILL BE EXCLUDED from the sale.

Sadly this points to some bad habits by brands and a continued shoveling of cash at Google.

Think about that as you set up your ad plans for next week’s campaigns.

Cheers

(Images taken from eMarketer email).

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But go to the original chart and you see that in fact Travel has the highest disproportionate spend of any category of brand vs Direct Response.

Farewell Boomers – Travel Changes for Ever

November 24, 2013

VaultPad

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Music: Slow Dirge

I am a Baby Boomer. Born in 1953. I vividly remember the day on November 23rd 1963 when my headmaster – Fr McHugh came into the breakfast room at my Boarding School and told us what had happened in Dallas the day before. Most of us were too young to know the impact but the whole school (we were Catholics) were horrified that someone who was so well known would be assassinated in such a callous manner. At Mass that day prayers were said for Jackie, Caroline and John and the American People.

And now the passing of the torch from the generation that this event – in so many ways – defined, to the new generation. Yes it’s time for the Boomers to leave the stage. We have had a good run. My g-g-generation has had the power to control the market for consumerism. We defined the video experience. We have now raised children. We Made love, not war and we Turned on, tuned in, dropped out and we then dropped in again. Now Peyton Place has been replaced by Game of Thrones. We settled into becoming the amazing consumer engine. We found personal peace. We worried about the planet and did nothing about it. And we travelled… oh how we travelled.

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Growing up I was a very lucky person. I had been round the world by the time I was 4. Visited countries and seen things most people could only dream about. I still do it… must have been part of the gene pool that I inherited.

Henry Harteveldt and his team at HudsonCrossing have done it again coming up with a defining report on the handing of the torch from Boomers to Millenials. You MUST read this.

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So dear friends – its been a GREAT ride. As my peers head off into the sunset – we will be very important – we just wont define how the world buys travel. I have a WHOLE LOT of learning to do and I promise to do the best I can to provide you with these insights

 

Thanks for reading

Cheers

Timothy

Timothy’s 10 Characteristics of Today’s Traveller

November 23, 2013

VaultPad

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The 2013 Google Travel Study conducted by Ipsos is out and I am not enthused. Regular readers will know that I have a low opinion of surveys. At one time I was a stats person so i can’t fault the technical methodology (most of the time) with this year’s in particular. But I don’t think the consumer behaviour bears out the expectations that one can draw from Google’s and its conclusions.

Squillions of people are going to quote liberally from this study to make their points to spend more money on Mobile, Social and Video. Some will even use the “data” to support whole manners of business ideas and even the odd startup or two. But for me here is how I interpret the information that is presented.

Indulge me – this is how I interpret the report and why I think its high time we started thinking for ourselves rather than being pawns in Google’s game.

Timothy’s 10 characteristics of the traveller:

  1. Lack of trust – everyone lies on the web – reviews are never fully honest.
  2. Inspiration and Planning are NEVER linear …duh – what is this “funnel” anyway?
  3. Search is so screwed up in travel that I cannot get what I want when I want it. It’s a terribly frustrating process
  4. Collaboration is often mistaken for validation (and vice versa)
  5. Millenials are vastly different from Baby Boomers – Everyone is different, Geographically, Ethnically, Age-wise, me-wise.
  6. I always use multiple devices  AND multiple browsers in planning – frequently because I need to cross reference information.
  7. Video is a load of baloney. I don’t use it to watch videos – I do it for ways to see if the vendor is lying.
  8. Mobile does not equal a guy on the street booking a $4000 trip on his smartphone.
  9. I really need a place to capture, store, sort and process the things I find online that I want to bring together. No one does this.
  10. I am always looking for planning another trip – mostly the ones I will never take.

Do you agree with me? Well you don’t have to but I do want you to think about it. Read the report, even if it is a low grade work in my opinion. Then try and think about how the ever changing punter out there is being badly serviced. AND why the products and services most players have in the market are really poor and getting not better but actually worse. 

Finally please consider the “data”. if you are thinking of going into spending a load of cash on mobile – look very hard before you do. I am SO TIRED of being told how wonderful mobile is. Look at #8 above. Mobile is really about the user being untethered. That doesn’t mean he doesn’t use the Laptop. Do read the study by Expedia and this should help give you some context because that is based on some hard data. Google should be ashamed to put out this garbage.

The link to Google’s study can be found here.

Expedia Comscore’s study can be found here.

Cheers

Timothy

Digitial Ad Growth Powering Ahead – But Why?

November 16, 2013

VaultPad

Google is laughing all the way to the bank (once again) and those other folk – Facebook, Twitter, Linked in are all smiling broadly too. The number from SIG on Digital Ad growth in the last quarter would make anyone smile – if you were one of the companies. However I am perplexed at the growth in Social ad spending because I dont think it is justified.

I have a belief that a lot of this is good money chasing bad as people dont really understand Social and no decent performance metrics for Social spend are yet out there to accurately reflect the effectiveness of Ad spend on Social.

I encourage you to read the report (Link below).ec2b9b14-ca8b-4c45-855f-bbc3460428b8

It certainly makes for interesting reading but I hope those who are opening their wallets to Social and closing them to traditional advertising REALLY know what they are doing because if not – some media will go away and we will be left with a ton of schlock stuff.

Cheers

 

Social Media is it the sustaining or introduction of your brand? A reflection on Social Media and our lives.

November 14, 2013

VaultPad

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Normally I am not one to focus on branding. But I am fascinated by brands in today’s ADHD world. I constantly ask myself whether brands are relevant in a world of on-demand always on information resources.

Personally I find a sense of irritation at the way in which the big access points of my life keep trying to mold me to their ways. The AGFA world (Apple Google Facebook Amazon) each is telling me – many non- too subtly – that I have to do things their way. And no-one seems to bat an eyelid at that. So I was very interested to see this recent piece by eMarketer on the manner in which Social media weaves its way through our lives, not that we didn’t know already.

But for me the most telling piece was the end paragraph. I would like to quote verbatim…

“Once they become loyal customers of a particular brand, it would seem natural that consumers who engage with brands on social networks would significantly prefer to use this channel to keep in touch with them. But this is not the case. Fifty-five percent of social network users reported they typically keep in touch by visiting brands’ websites—the top method of staying connected to a brand. A slightly lower share— 52%— said they commonly visit social network pages as a way of staying in touch with their favorite brands. “

And perhaps this is a reflection of the mixed way we all approach Social Media. Older folks like me still like Social Media as a way of keeping in touch with people in whom we share past experiences. Millenials are in many cases eschewing Facebook because they have better things to do with their lives in creating the experiences that will in turn define their lives. And that is part of Life’s rich tapestry.
 
Our brands are not just marketeers’ inventions but today in many cases we have created our own brands. We should just take care not to mess it up.
 
Cheers

Mobile Web – Frustration or Paradise?

February 17, 2013

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Way back in the 1990s the world’s first true global roaming phone was the Motorola Timeport. I recall one of my colleagues at the time was SO frustrated with the experience that he went home one day and got a hammer and nail and drove a stake through the heart of the errant device.

Have things improved lately?

Well according to most surveys despite the wonderful projections of how we are all going to be mobile in just a few years – there is a very strong undercurrent of dissatisfaction with Mobile based applications and the Mobile web in general.

The Mobile Experience is almost universally a compromise – and frequently not a good one at that. A 2011 Survey by Modapt, Inc. and Morrissey & Company suggested users are frustrated with Mobile Web experience. In this survey the majority of respondents were Smart Phone users. This would tend to indicate that the users were early adopters and savvy technology users. Yet their responses were not that happy.

  • While 95% of respondents reported using advanced smartphones, more than 86% found their mobile browsing experience to be either ‘okay’ or ‘frustrating’.
  • The Big 3 of user frustration are: slow downloads 40%, Difficult to navigate 40%, and Hard to find/read information 20%
  • Nearly one-half (48%) of smartphone users never make purchases via mobile

In a similar study published in August 2012 that confirmed the early results.  Keynote Competitive Research studied mobile behaviour from a much broader sample of US users. The study showed that 60% of tablet users expect to wait less than three seconds to get to a website, while 48% of PC Web users want download speeds faster than two seconds. Smartphone users also have high expectations, with 64% wanting a website to load within 4 four seconds and 82% of respondents wanting the website to load within five seconds. Even more startling is that 16% of users will not return to a site if it takes longer than six seconds to load, with 6% of users opting instead for competitor websites.

While Apps have created small specific applications – the explosive growth of the App market has created a number of cascading problems. Already we have the usual types of problems. Phantom downloads, poor search and even worse badly written Apps. As the barrier to entry is so low – almost everyone has been encouraged to enter the mobile web. This has created a cottage industry of plain awful App writers. Poor security (both with data and just in general) has created an opportunity for a new breed of hackers to steal your data. With Apple’s Passbook now a fixture in the iOS world – there are clear indications that the back door entry into your personal data from badly designed Apps (as well as Apple’s low barrier to certification processes) are going to result in security breaches. We just haven’t seen them – yet. From the Modapt study, Not surprisingly, fully one-half (50%) of smartphone users say they feel less secure about paying for something via mobile browser than desktop browser.

Another big issue is the nature of both Wifi and Cellular data based performance from the network. Wifi 802.11ac performance is now acceptable for most data applications but frequently the problem is not in the local network but in the backbone. The expectation of free wifi that most users have is now tempered with smart acces points having dual speeds. Crippled and OK. Crippled are free, OK is if you pay a premium.But we are to blame as well. Count the number of Wifi enabled devices you have. And then try and turn them on at the same time in a hotel or airport. Even a few years ago I was in a leading e-commerce player in a major market and was appalled to learn that their backbone to the web was not even a 56K circuit, yet they had hundreds of users in their environment. Cellular data performance is just plain awful for data. I have used extensively iOS, Android and Blackberry data devices using Cellular connections around the world. Frankly they all suck.

And then there is the cost. Several times in my speaking engagements I have asked the audience to honestly admit (of those who data roam) if they have ever left their data circuits on and received a large bill. go on admit it – you have too! (Oh yes and I do it frequently. Mostly because I am lazy or just forgetful.)

Consumer expectations and network performance are clearly in a state of dissonance.

Actually i am pessimistic about the network speed issue. 4G LTE the standard of choice for mobile data via cellular is not that much of a performance bump from 3G. Sadly APP and Mobile Web providers have chosen to take advantage of the speed to bulk up their offerings instead of allowing lighter applications to prevail and for the users to get real speed.

Nothing can be more frustrating for a user that to show up while data roaming and seeing a little notice that says. Download our App and get better access faster. In your head you calculate that the downloading the App will cost about $25 and so you wait in line… now even madder than you were before you saw that little sign. And its not just the consumers who are frustrated. Kayak recently abandoned its relationship with one of the current darlings of the Mobile Web. GetyourGuide. Further I have spoken to many players who have spent large amounts of money developing web applications only to be very frustrated with the results. Typical complaints are:

  • Poor adoption
  • Low usage
  • High costs

Google – with so much vested in mobile (not necessarily in mobile e-commerce (MCommerce) have some good advice for you. They even have a website to help you Go Mobile. howtogomo.com

Mobile providers – networks and application systems need to up their game. There is just too much crap out there and that has to change.

Cheers

Virtualization Comes to Mobile & Not A Moment Too Soon

February 16, 2013

VaultPad

Many of us are starting to doubt the hype around mobile in Travel Technology. There can be no doubt that it is critically important. However as to the level of that importance and the extent to which we should ascribe real world activity should be placed under the microscope. At the recent Future Day in Miami hosted by Farelogix to show case Distribution trends in Travel one of the presenters was Norm Rose. I have pulled one of his slides to illustrate the point. (You can see the whole presentation here on Slideshare.)Screen Shot 2013-02-16 at 12.01.55 PM

I believe that mobile is not everything. It is a part of the ecosystem but not the entire ecosystem itself. Where I do agree is in the first part of his statement but not his conclusion – namely that within 5 years the concept of mobile as a separate entity will disappear. The line is already blurred. So why do I disagree with Norm on this topic? In my view the reason is that the infrastructure to support mobile is not living up to the hype. There are many barriers to entry not least of which is cost. But don’t take my word for it. I cite the study by Localytics from 2012 which showed that only 6% of total App use was via Cellular.

But is there hope for the change and that Mobile will become as valuable (albeit a little less than what Norm is saying)? There are a few missing components and one critical one I think is about to get solved.

Virtualization has become a major buzzword in IT as the ability to adopt different entities makes management of IT resources more tolerable. The explosion of BYOD and the advance of Apple to the top of the PC tree makes Virtualization an essential part of the IT arsenal. But for mobile – there is a different set of challenges. Not least of which is the size of the screens involved. Time to learn a new term Hypervisor.

For the brief value – let me describe Hypervisor technology as a way to add virtual personalities to your mobile smartphone. Check out this article. For a person like myself who travels extensively – I suffer as I have to keep track of different and real personas for the different markets that I enter. I carry usually 3 telephones. 2 Smartphones and 1 dual SIM device. Swapping SIMs is a way of life when I am in a market. Looking at my desk today I see within eyeshot – 11 different SIMs. Virtualization can and should help to reduce this clutter and allow me to adopt different personas for work (in my case different segments) and at the same time enable me to optimize the cost of the communications device.

This will not come easy and there will be a degree of resistance particularly from the Mobile Network people. It is estimated that some time this year the number of cell phones will exceed the number of people on the planet (2011 numbers have this at 87%). Looking at the top 65 markets we can see that the heaviest concentration is Saudi Arabia where the percentage of Mobile phone users to total population is a whopping 170%. That number of subscribers could be reduced with Virtualization, so the networks are not going to be too keen to give up any revenue.

Just a little food for thought as you plan your Mobile Strategy. Just let’s say you should be a little more cautious rather than being a simple iSheep!

Cheers
Timothy

 

 

How Well Do Predictions Work – a Review of 2012

December 29, 2012

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Each year the team at TNooz does a series of predictions. This coming year the focus is on Mobile, surprising since I think we are already there. It is one of the most popular series the team does.

But how well did we do for 2012? The TNooz predictions for 2012 were not that bad. But in the interests of a true public service – perhaps a bit of self flagellation is in order.

First what did I predict?
1. User experience hits home

I predict that the current dissatisfaction with user experience with travel brands on the web will accelerate in 2012. In fact, I believe that we will start using the term “consumer fatigue”.

This will have a massive impact on web search and shopping for other products, but it will hit travel hard as the current processes and widget-based explicit interaction are really rather awful.

2. Cash for cache

The process of availability cache creation will start to cause significant issues. Owners of inventory will effectively start charging for the access to an “approved” state of availability.

This will cause significant problems for the metasearch or search companies in the travel industry

HOW DID I DO

1. User Experience. Oh yes. Decidedly this has happened. Some hard data shows that users are moving away from the conventional UX particularly in mobile. Mobile search has also proved to be an obstacle to “sellers” and users alike.  I will give myself 7/10 marks for this one. It is a slow burn and one that will happen over time. The problem is that the manifestation of it will come in different ways. While its not cited as the reason – I believe that a large part of IATA’s NDC effort has now focused on the Users ability to provide information via the intermediary channel to the supply community.

The issue of handling the ocean of data and how we access it is not going to get easier. Big Data tools are slowly making it better but we still have no trust (or rather not enough trust) in what we are seeing. Essentially we dont trust machine results enough to rely on them.

2. The battle over cache, Again a behind the scenes battle and one that will continue for a long time. Part of the problems with transactional sites is that they need to work on cache for performance. As users have little to no trust in the results anyway – web site performance matters more than accuracy and quality of results. Its logical. If the site doesn’t perform fast enough then users bail out of the process and click away before even analyzing the results. In the case of the airlines – this is endemic driven by the airlines’ need for obfuscation of the price. In the case of hotels – it is natural given the complexity and multiple models of the accommodation market. However I will only give myself 5/10 for this one. Its there but I can’t demonstrate that it has proved to be as important as I think. Trust me though behind the scenes this one is a 9/10.

So how will I do in 2013? A good question. Let’s see.
Cheers

Timothy

Beware the Sharing Economy. It can and will be a problem

December 28, 2012

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Great story from the SJC Mercury News – the local newspaper of Silicon Valley. In this they describe the perils of the so called “Sharing Economy”.

The article has been widely syndicated.

The need to create alternatives is powering a lot of startup fever. There are compelling reasons to create social platforms for sharing. However many of those doing these type of projects are younger folks who have not had to deal with the regular real world infrastructure of regulatory and commercial frameworks that exist – for a good reason.

I have commented frequently that I am most concerned that AirBnB and others in the “Sharing Economy” are in fact breaking the law. I have provided detailed reasons why I believe that multiple laws are being broken. These laws are not just commercial framework laws. They exist in many cases for consumer protection. In many cases they also exist for taxation and recovery of social costs to the community. Thus the justification that it is a new model that can blow up an old one is fine when it is simply a commercial issue. For example Expedia et al when they launched against the conventional travel agencies. Ditto Zillow and its ilk. BUT when you are dealing with not even a loop hole in the law but a real flouting of a specific law, then you must accept the consequences.

The last part of the SJC MN article is telling:

“SideCar CEO Paul claims drivers for his startup “are not actually contractors” but “volunteers.”

It’s not likely, however, that regulatory agencies and the IRS will agree with that definition. ”

And this is the case. If it quacks like a duck and it walks like a duck, chances are that it is a duck. Sidecar’s drivers are not volunteers. That is complete BS.

But the rash of lawsuits is beginning to bite. Both AirBnB and its competitors are rushing out new terms to their “hosts” most of which will be ignored by the people who have been brought up to ignore the legal terms and conditions. These new terms are not changing the basic facts. AirBnB is breaking the law in multiple instances. That laws are not enforced is a problem for all. But just because they are not enforced does not mean they do not exist. Nor that evasion or the 11th Commandment (Thou Shalt Not Get Caught) insulate you as a Startup and Entrepreneur.

You have been warned.

 

Cheers