INDUSTRY PROFILE: TRAVEL & HOSPITALITY
According to Statista, worldwide, the travel industry an annual economic impact of around $6.5 trillion USD. Airlines generate over $700 billion USD, while hotels generate around $500 billion USD each year. Three of the most important hotel KPIs are RevPar, ADR, and occupancy rate. RevPar is revenue per available room and ADR is the average daily rate (ADR). The largest hotelier groups are Marriott, Hilton, Starwood, Wyndham, Accor, and InterContinental. American, Southwest, Delta, Lufthansa, United, China Southern, and Air France-KLM are some of the largest airlines. Valued at $9.1 billion USD, American Airlines was the airline with the highest brand value in 2017, closely followed by Delta, United and Emirates. Not surprisingly, economists have found a correlation between the vitality of the global economy and the profitability of the travel sector.
CUSTOMERS & SEGMENTS
Beginning in 2012, there were more than one billion travelers, with the most coming from China, Germany, and America. With the exception of frequent business travelers, Deloitte asserts “most consumers do not travel very often—maybe two or three times a year.” Their exposure to travel brands are not high, but apps such as Uber, Airbnb and dating sites raised expectations about what is possible with just a few swipes or taps. This is impacting the travel industry. Treksoft found that travel brands tailored its overall trip experience based onpast behavior or personal preferences, 36 percent would be likely to pay more for their services. In the United States, 26 percent of travel searches in the fourth quarter of last year occurred on a mobile device. In other parts of the world, it’s even higher. It is 47 percent in Europe and 40 percent in Asia-Pacific.
BUSINESS MODELS & PROCESSES
The good news is that Gartner reports that more than half of enterprises will implement significant business model changes to improve customer experience (CX). Jae Alexis Lee was a project manager for call routing overhaul. Regarding CX, he noted it is “considered in virtually every workflow design. There are, however, competing priorities for reducing costs, improving efficiency, and preventing fraud and abuse.” Lee noted that data is used to make each decision; call centers design pain points into business processes to change behavior. Managers don’t always want customers to remain on the line. Forrester has found that 45 percent of U.S. consumers will abandon an online transaction if their concerns are not addressed quickly. The bad news is that Accenture research has estimated that $1.6 trillion USD is lost as a result of customers switching due to poor service.