SkiftX: What are some of the changes travel brands can make? What are the new opportunities?
Choi: The travel industry has historically been built around business and leisure: in how they represent their brands, how they approach sales and distribution, and how they acquire their customers. Many traditional brands have grown through frequent business travelers, such as the consultants at Publicis Sapient. I’ve always said that there’s no such thing as business vs. leisure, there are just travelers who in a particular journey are traveling for business. As brands look beyond COVID-19, they will have to mature their approach and understanding of their customers. One of the benefits of my role at Publicis Sapient is to observe the best practices across industries, applying them to the Travel & Hospitality segment. I believe as the industry continues down the path toward Digital Transformation, a much deeper understanding of their customers will drive competitive advantage and the next generation of Travel. Business travel will take some time, travelers will return in a piecemeal fashion, and the winners will be able to translate customer insight into opportunity quickly. The core business traveler segment for many full-service airlines and hotels has been decimated, and we have to acknowledge that it’s going to be a while before this audience returns in full force. For example, if I normally travel for business and I decide to take a vacation, most hotel brands won’t know that I’m there now as a leisure traveler.
It’s also time to reevaluate the relationship with online travel agencies (OTAs). OTAs are good at customer acquisition, targeted marketing, and personalized offers — and they primarily focus on the leisure audience. But it’s important for brands now to re-engage with those travelers directly. Not only will they have to better understand the audience they do have and foster those relationships, but they’ll also have to find the opportunities to engage and learn about the broader audience that includes leisure travelers.
Finally, travel and hospitality brands should define adjacent business models to service customers more comprehensively. This goes beyond ancillary revenue from things like meals, baggage fees, and seat room. Many travel brands have the foundation and the scale to expand their business territories in areas such as retail, food and dining, entertainment, financial services, etc. Beyond the flight or stay, these new categories have to be informed by a better understanding of the customer.