TravelTecnik Consultants - Travel & Hospitality Technology

BIGGER problem with premium retail space : Rental cost or Low Footfall

2009-04-10T13:13:00.007+08:00

The Great India Retail saga!

The current economic downturn has affected the stupendous (high double digit) growth rate Retail industry was enjoying. Retail business in India is still maintaining its growth given the prevailing unfavorable market conditions. There is a lot of investment riding on retail industry and to develop newer facilities for retail business. The options are aplenty these days, range catering to various (specific) retail needs.

Challenges posed to the realty developers are paramount. Developers like DLF, Unitech, Ansal etc. are facing multi-dimensional problems; grave pressure to meet the timelines on their new projects, threatened by international giants (walmart, carrefour) entering the retails space, while simultaneously stressed to ensure footfalls at their Malls and Mega shopping facilities that are already open.

Mall rental vs Low footfall

Retail spaces are expensive because there are definite costs involved to maintain and upkeep such fabulous, worldclass facilities. The bigger problem I think is that the malls fail to attract visitors. The retailers are not able to find the value for money staying invested in a luxury or up-market shopping mall. It is in mutual interest of both the mall operators & retailers as well as a core responsibility of the mall operators to stimulate footfalls.

How to stimulate footfall?

(Traditionally) Among the many things that attract desired attention are;

Source of entertainment - Food courts, Cineplex, Pubs etc

Organise events with celebrity attractions

Shopping festival / carnivals

Special attractions for kids etc. etc

Fresh ideas!

How about DLF starts (FREE) shuttle service in the city connecting its malls and the city hotels. DLF could engage city tour operators to do the job for them. For example in the city of Delhi; the shuttle service would connect the DLF GIP Saket & DLF Place & Emporio Vasant Kunj with 11 odd (5 star) international luxury hotels (in CP alone). This would encourage tourist & leisure travelers (both domestic & international) and would ensure a lot of cross pollination across board the tourism sector. Moreover this would also reduce the traffic on city road.

It is a tried & successful strategy observed in markets overseas, then what are we waiting for.

Contemporary (HOTEL) Marketing thru Videos!

2009-03-28T14:13:00.023+08:00

Videos are playing an ever increasing role in the online marketing process. Marketers have realised that videos help increase brand recognition, create buzz and help promote and sell the products or services more effectively.

Hospitality businesses in India must finely compliment the online marketing effort by the traditional approach of direct contact with target audience.

How To Go About Video Marketing

Popular concept in video marketing is the creation of "viral" videos. Videos that are so entertaining, bizarre, or funny that people will refer their friends. If done correctly, the video will spread like wildfire across the internet, reaching hundreds of thousands of people, without costing you a cent in advertising or hosting costs.

Create video content to enrich your site
Create a sales letter/pitch to promote your video
Build more personal relationship with subscribers
Keep in contact with your clients for feedback

Where You Can Submit Your Video

YouTube – http://www.YouTube.com

Google Video - http://video.google.com/

Yahoo Video - http://video.yahoo.com/

FlickLife - http://www.veoh.com/

Blip - http://blip.tv/

Crackle - http://crackle.com/

Flurl - http://www.flurl.com/

BoFunk - http://www.bofunk.com/

Vimeo - http://vimeo.com/

Flixya - http://www.flixya.com/

What To Consider While Posting Your Video

You must use some tricks; pick the right keywords, and create some backlinks to the posted videos. Give it a catchy title and teaser to get people interested. One can also social bookmark them, submit their RSSs to some RSS search engines.

Strategy To Go About Promoting The Video

1. Bookmark and RSS feeds are perhaps the more important marketing tools which actually give videos their unlimited potential. There are a lot of internet sites that now host and share bookmarks. You can add links to these sites to your article pages. There are two ways of doing this. You can go to each of the leading bookmarking sites and download their code and links onto your site. The ones that you should include are:

Digg - www.digg.com

Technorati – www.technorati.com

Del.icio.us – www.del.icio.us

Reddit – www.reddit.com

The alternative is to put a link to AddThis.com for direct access to over 30 bookmarking sites.

2. Using Social Networking sites to Promote you video. A big part of this phenomenon is the activity of finding, sharing and recommending products, services, events and experiences to like-minded people.

Twitter - http://twitter.com

Facebook – www.facebook.com

LinkedIn – www.linkedin.com

MySpace – www.myspace.com

Orkut – www.orkut.com

If you can get people to talk about and recommend your products & services to their peers, it is more powerful than any marketing you can buy.

3. Partner with Travel portals and MetaSearch engines to promote your video.

Travelocity
Cleartrip Make My Trip
Desiya
Yatra
Expedia
www.IxiGo.com

4. Tie up to with websites offering content like current affairs (NEWS) & other popular lifestyle / fashion content. Run banner campaigns / ads to attract traffic for your video on your own website.

NDTV
TimesNow
Rediff
MSN

5. Promote the videos at Malls on their electronic billboards. (huge plasma screens)

6. Run the video at Multiplexes

7. Tie up with Airlines to promote your videos on their inflight entertainment system.

Important:

The true essence of the campaign lies in being able to track and measure the reach & effectiveness. By using simple tools available like Google Analytics you must track the progress of the campaign.

Marketing Basics

2008-09-12T15:07:00.013+08:00

The Big 3 of Marketing Strategies that companies need to grow their business.

Marketing Strategy #1. Increase the number of customers

Increasing the total number of customers is the first step most business owners and managers take to grow their business. Losses can occur when inexperienced sales personnel are put in charge of designing and implementing a marketing program - investing corporate resources to find more customers. Executed correctly, basic marketing strategies cost efficiently produce new prospects who are ready, willing and able to buy products or services. The main purpose of a marketing strategy is to give sales personnel prospects to convert into paying customers. Rewarding existing customers for referring new ones is one easy step business owners can take to increase their total number of customers.

Marketing Strategy #2. Increase the average transaction amount

Owners and managers spend most of their time operating their business and searching for new customers. They often overlook the customers they see regularly. These repeat customers are usually taken for granted and left to conduct entire transactions without ever being asked if they would like to buy more product or service. Complacency, expecting customers to buy a minimum amount of product or service without ever being asked to buy more, can be the undoing of a business. This attitude can eventually cause customers to spend less money. Customers who are'nt continuously offered compelling reasons to keep buying more of the same products and services from one business will look for new reasons to buy from another. Cross selling and upselling, systematically offering customers more value via additional products or services at the point of sale, are two simple steps business owners can take to increase their average transaction amount.

Marketing Strategy #3. Increase the frequency of repurchase

In an established business, an average customer purchasing pattern develops and (like the average transaction amount) is usually taken for granted and rarely improved upon. A customer’s repeat business is earned by the business who gives the customer what they want. Without having basic marketing strategies or processes for consistently offering customers more of what they want, repeat business is earned less frequently. Frequently communicating news and offers to past and present customers via telephone or mail generally increases their frequency of repurchase and is one more step owners can take to grow their business.

Conclusion

Every marketing strategy should be measured by its ability to directly impact and improve upon each of these three factors. Increasing only one factor will produce linear business growth. Increasing all three factors will produce geometric business growth.

Bleeding Travel Agents

2008-07-01T11:15:00.008+08:00

Airline companies in India, facing a combined $2 billion (Rs8,580 crore) loss this fiscal because of high fuel costs and fierce competition, are resorting to steps including cutting down on flights, and have already cut the commission to travel agents from 9% to 5% earlier.

State-owned National Aviation Co. of India Ltd or Nacil, Jet Airways India Ltd and Kingfisher Airlines Ltd. in an effort to cut costs, have decided to scrap the 5% commission on basic fare from 1 October, (which is before taxes and surcharges) that they pay to travel agents. That will dry up the widest revenue stream for agents—about 90% of their business is from airline bookings, mostly for corporate clients.

About 85% of airline bookings in India are done through travel agents, including online agencies such as MakeMyTrip India Pvt. Ltd and Cleartrip Travel Services Pvt. Ltd. Rest is booked directly by passengers. To compensate revenue losses, some travel agents are planning to impose a service charge on the bookings they make. But that will make their services more costly as bookings through airline websites, where there is no service charge, will be cheaper. Travel agents plan to charge Rs100 per passenger for domestic travel and Rs500 for international tickets from October 08.

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Changing Dynamics of GDS business

August 2006: Redefining relationships with U.S. based travel management companies, Sabre Travel Network had introduced an optional fee-based program that gives its global distribution subscribers access to full airfare content and immunity from airline service charges. Sources said Sabre's move is the bellwether of new dynamics between GDSs and corporate travel agencies and likely would lead to additional expenses for corporate travel buyers.

Although Sabre would not disclose the new agency payment terms, Sabre CEO Sam Gilliland said they would be "opaque," as they have been with the airlines. As per Sabre Travel Network senior vice president of North America Chris Kroeger, travel management companies in effect will pay Sabre to leverage full content, but still receive incentives, albeit shrinking ones, from the GDS. "Sabre connected agencies that elect not to participate will not have assurance of access to full content," Kroeger said. "It does not put an end to incentives," Kroeger said. "We've been very open as we've talked about this balanced approach that there is a role for incentives." Gilliland has said incentives are coming down and Kroeger concurred.

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We will have to wait and watch the strategic developments in India in the near future...

Amadeus and Hospitality Technology

2007-12-09T21:06:00.002+08:00

Today, hospitality technology remains fragmented and hotels still operate multiple systems. In order to improve guest service while maximizing occupancy and (RevPar) Revenue per Available Room, the hospitality industry recognizes the need for newer technologies and yield maximization systems that will allow hotels to regain control over their inventory and pricing, and address a wide variety of distribution options.

In the quest for market leadership, Amadeus had taken over Hogatex-Optims, the leading European supplier of IT services to the hospitality industry. Amadeus had already begun developing a new platform when it acquired Optims, the French hotel distribution company, in 2005. Optims now operates under the name of Amadeus Hospitality. This acquisition is expected to provide accelerated delivery of a new and integrated Hotel Distribution Platform that will serve hotel reservations from all direct and indirect distribution channels, through a single and centralized inventory of hotel rooms and rates.

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How is it supposed to work?

GDSs have always been linked to hotel chain codes or to IATA city or airport codes for hotel searches, which offers limited search capabilities. The new system will liberate searches from those codes by adding lot many search options including simple city names or regions, such as "the south of France." That will make it easier to find hotels in small cities and towns even if they are not close to airports. Search terms can be combined: a hotel in southern France with a swimming pool, for example.

Travel Agents will easily be able to request hotels that offer high-speed Internet, a swimming pool or other features, and the results will be returned in the right order. Amadeus plans to roll out Hotel Plus, a new user interface for agents that incorporates the best of business-to-consumer selling features but is designed specifically for agencies to maximize sales. The browser-based technology will be fully integrated with the Amadeus GDS.

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Way forward for Amadeus

To start with, Amadeus wishes to extend the ability to store any type of images and videos and multiple languages with all types of characters. Amadeus recently has completed the migration of the 75,000 hotel properties that participate in its GDS from a system based on TPF (transaction processing facility) to a Linux platform. The new platform and a new set of technologies, all based on OpenTravel Alliance XML standards, will help bring the hotel industry into a new era for distribution.

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In the second phase, Amadeus will introduce a content management platform that will provide a "single point of entry" for mid-sized and large chains to update their rich content across all distribution channels simultaneously.

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In the third phase, Amadeus will introduce a next-generation reservations platform. Hotels will be able to centralize multichannel distribution, reservations and content management on one platform. With integrated PMS reservations functions, the platform will offer hotels a single image of the chain's inventory of available rooms.

Rising of The Sabre!

2007-12-05T14:14:00.000+08:00

As I like to say, ‘Change is the only constant’. This is not a case study, but just a casual insight into winning with diversification. Here I wish to discuss the transformation of a Travel networking company with primary interest in global travel distribution, into a travel giant called ‘Sabre Holdings Corporation’.

Sabre Holdings, an S&P 500 company, is a world leader in travel commerce, retailing travel products and providing distribution and technology solutions for the travel industry. Headquartered in Southlake, Texas, in the Dallas-Fort Worth Metroplex, the company has more than 9,000 employees in 45 countries. Sabre grossed annual revenues of $2.8 billion in 2006.

Sabre has interesting line of businesses encompassing the entire travel industry that cater to Online Travel distribution, B2C & B2B Travel solutions, and Airline solutions.

Sabre Travel Network markets and distributes travel-related products and services through the travel agency and corporate channels. This would include Sabre GDS and MySabre™ a Web-based agent booking portal.

Travelocity is a leading provider of consumer-direct travel services for the leisure and business traveler. It markets and distributes travel-related products and services directly to individuals through Travelocity and its various brand Web sites and contact centers, and Web sites owned by its supplier and distribution partners.

Sabre Airline Solutions is the world’s largest provider of software products, passenger solutions and consulting services for airlines. Sabre Airline Solutions helps airlines reduce costs, simplify operations, maximize revenue and improve customer service.

Sabre finally starts full-fledged operations in India

Sabre is not new to India but it definitely lacked visibility in the Indian market. Sabre continues to have a strong business relationship with the leading domestic carrier Jet Airways, since its inception. In a strategic approach to strengthen its business partnerships Sabre has recently opened a state-of-the-art facility in Bangalore, India. It currently houses 60 employees that support product development activities for all Sabre businesses and offers delivery services and customer support for regional airlines, Jet Airways and Kingfisher Airlines. The center also drives project/product delivery through Sabre Holdings vendors in India for software development.

Sabre successfully integrates Hotel content through acquisition

In a move to further expand its services to the hotel industry, Sabre Holdings Corporation recently acquired SynXis Corporation, a privately-held provider of reservation management, distribution and technology services for hotels.

SynXis with $2 billion in revenue is the technology source for more than 8,000 hotels, bed and breakfasts, resorts, and destinations, including, Harrah's, Interstate Hotels & Resorts, Millennium Copthorne, Destination Hotels & Resorts, and Jumeirah Hotels. Through the SynXis system, hotel properties are able to seamlessly sell through global distribution systems (GDSs), including the Sabre GDS, as well as over 1,600 third party Internet travel sites, and hotel reservation offices/central reservation centers. This Provides Sabre Holdings with unique role in end-to-end selling process from hotels to travelers.

We will be seeing more of these technical collaborations in coming times.

History of Global Distribution Systems (GDS)

2007-12-04T18:59:00.000+08:00

The airline industry created the first GDS in the 1960s as a way to keep track of flight schedules, availability, and prices. Although accused of being “dinosaurs” due to their use of legacy system technology, the GDSs were actually among the first e-commerce companies in the world facilitating B2B electronic commerce as early as the mid 1970s, when SABRE (owned by American Airline) and Apollo (United) began installing their propriety internal reservations systems in travel agencies.

Prior to this, travel agents spent an inordinate amount of time manually entering reservations and pricing itineraries referring to tariff books published by ATPCO. The airlines realized that by automating the reservation process for travel agents, they could make the travel agents more productive and essentially turn into an extension of the airline’s sales force. It is these original, legacy GDSs that today provide the backbone to the Internet travel distribution system.

As you know that there are four major GDS systems:

-Amadeus

-Galileo

-Sabre

-Worldspan

In addition, there are several smaller or regional GDSs, including SITA’s Sahara, Infini (Japan), Axess (Japan), Tapas (Korea), Fantasia (South Pacific), and Abacus (Asia/Pacific) that serve interests or specific regions or countries. Though the ownership of the travel distribution companies keeps changing, let us take a closer look at ORIGIN of the four major GDSs.

Founded in 1987 by Air France, Iberia, Lufthansa, and SAS, Amadeus is the youngest of the four GDS companies. Amadeus is a leading global distribution system and technology provider serving the marketing, sales, and distribution needs of the world’s travel and tourism industries. Its comprehensive data network and database, among the largest of their kind in Europe, serve more than 87,000 travel agency locations and more than 12,500 airline sales offices in some 250 markets worldwide. The system can also provide access to approximately 80,000 hotels and 60 car rental companies serving some 54,000 locations, as well as other provider groups, including ferry, rail, cruise, insurance, and tour operators.

Amadeus appears to be adapting well to the shift of business to the Internet. Backed by an early acquisition of e-Travel, Inc. from Oracle Corporation in July of 2001, Amadeus had a new business unit dedicated to delivering solutions to e-commerce players worldwide. The e-Travel solutions integrate all components of a managed travel program into a single Internet-based service that enables travelers to book air, car, hotel, and rail services, all within corporate guidelines. As with its competitors, the future for Amadeus will continue to be linked to the technological and structural changes that are revolutionizing the travel industry.

Galileo global travel distribution system is also known as the Apollo system in North America and Japan. Galileo International was founded in 1993 by 11 major North American and European airlines: Aer Lingus, Air Canada, Alitalia, Austrian Airlines, British Airways, KLM Royal Dutch Airlines, Olympic Airlines, Swissair, TAP Air Portugal, United Airlines, and US Airways. It is a major player in the GDS business throughout the world: North America, Europe, the Middle East, Africa, and the Asia/Pacific region.

Galileo International is a diversified, global technology leader. Its core business is providing electronic global distribution services for the travel industry through its computerized reservation systems, leading-edge products and innovative Internet-based solutions. Galileo is a cautious follower when it comes to technology. However, in response to the growing demand of web-based travel, the company has established various successful relationships with entities providing Internet-based tools and services to the corporate travel market; by Sheperd Systems, an industry leader in the provision of sales and marketing intelligence systems and services within the travel industry. Galileo is a value-added distributor of travel inventory dedicated to supporting its travel agency and corporate customers and, through them, expanding traveler choice.

For more than 40 years, Sabre has been developing innovations and transforming the business of travel. From the original Sabre computer reservations system in the 1960s, to advanced airline yield management systems in the 1980s, to leading travel web sites today, Sabre technology has traveled through time, around the world, and has touched all points of the travel industry.

In July of 1996, Sabre became a separate legal entity of AMR (parent company of American Airlines), followed by a successful initial public offering in October in which AMR released approximately 18% of its shares to be publicly traded. Sabre, represented in 45 countries, is a leading provider of technology for the travel industry and provides innovative products that enable travel commerce and services, and enhance airline/supplier operations. Sabre owns Travelocity.com, the industry’s leading online consumer travel web site. Sabre also owns Get There, a provider of web-based corporate travel procurement, including the purchase of air, hotel, car, and meeting planning services.

Founded February 7, 1990, Worldspan was originally owned by affiliates of Delta Air Lines, Inc. (40%), Northwest Airlines (34%), and American Airlines, Inc. (26%). Since its 1995 advance into the world of Internet technology for the travel industry, Worldspan has successfully developed the strategies, solutions, and services to ensure the company’s long-term success in the new web-based world of travel distribution. Worldspan provides worldwide electronic distribution of travel information, Internet products and connectivity, and e-commerce capabilities for travel agencies, travel service providers, and corporations.

Worldspan has a legacy of industry firsts that are not well known. In 2001, Orbitz LLC was launched on the Internet, using Worldspan as its Internet Booking Engine, and in 2002, the launch of Worldspan ePricingSM made Worldspan the first GDS to introduce a revolutionary new multi-server-based technology, offering an unprecedented selection of pricing options to all of Worldspan’s customers.

E-commerce and Travel Portals

2007-11-21T12:49:00.000+08:00

Is E-Commerce in India growing at the pace that it should?

As per the latest findings, Indian Ecommerce growth is pegged at 30% year on year. Let’s look at some interesting facts;

As per the report released by Internet and Mobile Association of India (IAMAI) and IMRB International, the total online transactions in India stood at Rs. 7080 Crores (approx $1.75 billion) for 2006/2007 and is expected to grow by 30% to touch 9210 crores (approx $2.15 billion) by 2007/2008.

In other words, that is only 0.002% of our GDP!

Distribution of Online spending

The Online spending is categorized mainly in following 5 areas:

Travel: comprising Travel aggregators, Tour Operators, Hotels and Railways
E-tailing: comprising Online Retailers and Online Auctions
Classifieds: comprising Online Jobs, Online Matrimony, Online Property, Online Automobile and General Classifieds
Paid Content Subscription: comprising research, articles, exclusive videos, etc
Digital downloads: from Internet to Mobiles and internet

Here is the chart explaining the online spending breakup:

It is quite clear that a large chunk of online spending goes towards Travel E-Commerce. Rs. 7000 crores out of 9210 crores is expected to be spent on online purchase related Travel purchases like Airfare, Hotels, Car rentals and Rail bookings. That means nearly 76% of overall E-Commerce goes to travel sector alone.

Inside Online Travel Portals

2007-11-20T13:01:00.000+08:00

The boom in Indian aviation sector is reaching its peak. The Air travel market is expected to grow at a brisk rate for at least next decade. This boom has created a big market for Indian online travel portals. Currently there are 8 to 10 players in the market competing for their pie. As most of them have come up recently they are still fine tuning their search capabilities. The Travel portals are expected to get better as time goes by.

With more than 75% of e-commerce spend happening purely on online travel booking, this space is getting quite lucrative. This puts Indian OTAs (Online travel agents) back in limelight. With the number of Online Travel agents reaching double figures, it is quite competitive too. The quest to move ahead of the competition has pushed some portals to introduce features that attract more audience. Cleartrip and IxIGo are pioneers in this field.

IXIGO a recent entrant has conveniently positioned itself as a pure ‘No-Nonsense’ search engine. It has introduced a new feature that will allow the users to search comparative rates among the major players - Yatra, Cleartrip and MakeMyTrip. Aloke Bajpai, the dynamic CEO of IxIGo and a personal friend, intends to offer its users total transparent deals. Drawn on the lines of Kayak.com, metasearch capabilities of IXIGO has already taken the company places. The user has the option to perform a live comparison from Yatra, Cleartrip & MakeMyTrip. The users have to simply click the three checkboxes while searching for the airfares on IXIGO itself.

This is an excellent feature!

Cleartrip on the other hand has launched Cleartrip graphs that provide users with indicative prices across range of dates for 9 different airlines. This will help users to find the cheapest fare rates across different carriers. This is a good feature but how many users would like to analyze pricing trends?

What is expected out of the Travel Search engines?

Taking into consideration the demographics of Indian market and the rural/urban population mix; the following (popular) parameters define the basics for the travel search engines.

- Cheapest fare search

- Flight options and connections

- Easy to use (User Interface)

- Ancillary services/Content

We have discussed so far what is happening on front end. Let’s take a walk on the other side and understand how it is done. The primary challenge for a Travel portal is to be able to offer ‘Cheapest’ fare. This basically involves the following;

- Gather content from multiple sources

- Run algorithms and arrange data

- Display the information

Gathering information may be through various channels, for example, direct feeds, APIs’, GDS etc. out of these GDS being the most popular ones. Studies conducted by an independent research group have proven that the Sabre global distribution system is the industry leader in finding the lowest available fares.

Here is how the Sabre system performed versus the competition:

The content is generic and available to all. Travel search engines are constantly trying to better themselves by utilizing latest in technology. The very popular trend these days is WEB 2.0 Mashup.

Web 2.0 uses technology based protocols to display information from multiple sites and categories and lets users organize that information in different ways on the screen or do more flexible searches. Common consumer examples of Web 2.0 include the social-networking Web site MySpace and YouTube, which allows users to post and watch videos via the Internet.

The year 2006-2007 was called the year of the travel portals. As more than a dozen travel portals were launched and almost half a dozen got funded. Among all the travel portals the ones like TravelGuru, Yatra, Makemytrip, Travelguru, Cleartrip and Ezeego1 have a lot of muscle power due to the funding and backing of large companies and VC’s. But from banner ads and TV ads for these portals it has been a paradigm shift to web 2.0 buzz and pull marketing.

Makemytrip along with their agency Webchutney were the early movers when it came to linking web 2.0 to travel. Their travel community Oktatabyebye which started as a contest has now graduated into a full fledged community with travelogues, travel QnA, polls, photos, videos, destination features, hotel reviews and recommendations with friends, family and other members of the site.

The other travel portal Cleartrip.com till now has had a different approach to web 2.0. They have used web 2.0 to get closer to their customers and get instant customer feedback by having an official cleartrip blog.

Final Verdict: It is difficult to judge or come to a conclusion based on couple of searches across multiple sites. However, it seems that there is tremendous scope for improvement, it is imperative that you got to have tie-ups and partnerships with different carriers to get the best rates. The newer search portals are quite user friendly and give you a much better user experience. However, when it comes to rates the older players still rule the roost.

Between the Devil and the Deep Blue Sea

2006-12-16T21:17:00.000+08:00

"Between the Devil

and the Deep Blue Sea"

In this new era everyone is latching on to the use of technology across industry verticals to do things in a better way. In the Travel and Travel distribution domain, the core function of a GDS Company remains effective distribution but responsibility of a GDS today goes beyond just distributing seats.

GDS is seen as a primary technology enabling partner not only to the Airlines but to Travel Agencies as well. To the Airlines, GDS allows them to reach agents, optimize revenues, manage seat sell-ability with integrated up-sell capabilities, reduce costs and find new ways to maximize revenues. While most progressive Travel Management Companies look up to the GDS for integrated content, to help enhance the revenue streams, channel maximization, manage agency network, manage travel financials etc. etc.

Travel agencies are taking interest in a whole range of products apart from Air and understand the benefit of technology enablers with diverse interfaces like integrated accounting packages and mid-office/back office etc. Up to a large amount skilled man power that was expended on cliché manual exercises can be automated and the energies can be focused on selling more content.

Challenges faced by the Travel Agencies

Increasing & Ruthless Competition
Reducing Customer Loyalty – customers today are deal seekers
Decrease In Profit Margins: Difficulty in tracking payments and pending payments
Ever Increasing Operating Costs; Lots of paperwork: Contracts, Vouchers, Invoices, Billing, Client info, Booking info. Difficulty in managing booking details, client information
Shift From Being Product Centric To Customer Centric: Strong need to Offer what customers want than offering what Travel companies have. Lack of flexibility to choose between deals, complete information is missing
New Channels Of Distribution: Lack of diversified selling channels therefore Limited target market
Ever Changing Market Dynamics
Unable To Push Or Sell Last Minute Inventory: Difficulty in moving the inventory faster resulting in loss of revenue

GDS and Travel Technology

Technology’s role in the space of inventory distribution and reach has been unprecedented, giving both principal and agent the access and flexibility to enhance the value of the inventory itself. The luxury and convenience of the past has become a cause of pain in the new era. Today the principals in particular want to know what is it that the GDS companies can do to justify the high cost of distribution they demand.

Challenges faced by the GDS

Lack of loyal customers with Increased & Fierce competition among GDS’s leading to Agency business Churn
Direct distribution from Airlines & Other Suppliers
Lack of Agent Relationship Management
No detailed insights into destination, type of travel sold etc – target content
No new revenue opportunity

Watch out for the next article that would be a postmortem of how the GDS sees the Indian Travel market and how the GDS aims towards bridging the gap….

Industry's Biggest Award Nite

2006-12-13T15:52:00.000+08:00

Industry's Biggest Award Nite

Galileo Delivers in Style!

After eluding the city of ‘DilWallas’ to the likes for the city of ‘Bollywood’ last year, Galileo Express Awards staged a comeback to New Delhi this time. The fourth edition of the Galileo Express TravelWorld Awards 2006 was held at Maurya Sheraton, New Delhi this year. It was yet another splendid industry affair attended by galore of Travel and Tourism industry’s most decorated personalities. The attendance included all, from high flying entrepreneurs, technology players, and business leaders of the corporate world to renowned celebrities of the entertainment world.

Popularly known as Galileo Express Awards, it has established itself as a well coveted and highly prestigious recognition in the Travel & Tourism vertical. At Galileo this effort is backed by a strong commitment to honor the best in the travel trade and is well received with the professionals in the Indian travel industry. These awards serve in encouraging and raising the bar for all those aspiring to reach this ultimate pinnacle of proven expertise in the Indian travel industry. So people who could not make it to the hall of fame this time have to pull up their socks and congratulations to all the winners.

In the end its 3 cheers to Galileo : HIP HIP……HURRAY………!

Who will benefit from the merger?

2006-12-10T17:05:00.000+08:00

Who will Benefit from the merger?

The Travel Distribution business today is no more restricited to the legacy travel agents but the people involved in this business are constantly spreading their wings to related fields as well. Namely Airline Distribution/Hosting, Online Booking Engines for Travel Portals, Data Intelligence tools, Accounting Packages additionally these companies are also gradually in the process of driving the consolidation of the global Travel business.

As you would know that the leading Online travel companies of the world like Expedia, Travelocity, Opodo, EBookers, TravelPort etc. are already part of some GDS directly or indirectly which inturn ensures that the Airlines stay with the GDS and in return GDS enjoys the travel distribution monopoly!

It is very pre-mature to say who will be the beneficiary from the TravelPort - Worldspan handshake but it is very evident that TravelPort is a stronger partner and if Worldspan's Technology can be put to some fruitful use and provided effective synergy is developed within, then Galileo can recover its market share and would be the Leader in Travel Distribution in no time....

Note: The Diagram has been developed to analyze and have a better understanding of the synergy of product offerings to the Travel community from the merger. This does not hold any significance as to how, in future, either of the companies wish to pave their way forward in their respective fields.

Consolidation in travel distribution

2006-12-10T05:40:00.000+08:00

Consolidation in GDS business!

After years of speculation, the inevitable consolidation in the GDS business has begun after Travelport (formerly Cendant Travel Distribution Services) acquired its rival Worldspan for $1.4 bn. Travelport has been suffering pre and post the Blackstone acquisition from an inability to easily integrate disparate entities and systems such as eBookers, Gulliver's and Galileo. The task of integrating Worldspan and Galileo is huge, and most likely will result in the Worldspan platform and brand fading from the marketplace.

Amadeus too is struggling to hold onto the top spot and is constantly faced with challenges to sustain its leadership. The Travel Technology domain in India has tremendous potential and is still very raw and rapidly growing. There is enough space for all and that’s why you would see numerous Technology companies setting off to develop and deliver expert Travel Solutions. There is confirmed news that the top brass, flamboyant Indian low cost carriers that were once powered by the Bird Information System (Travel Technology Division of Amadeus India) have broken terms with BIS. It is best time for competitors to catch up!

Watch out for latest action update on the Indian Travel front ...

Living Sales!

2006-11-06T14:47:00.000+08:00

Living Sales!

What I have observed and experienced in my sales career is that the young professionals aren’t getting the experience necessary to excel. Performing the Sales job is a lot of hard work that involves taking the responsibility of spearheading the organization in the market place, identifying and executing strategies to achieve targets and fulfill the organizational goals. Sales Team is considered to be the privileged of the lot, ‘The Black eyed and blue eyed babies’, but often the Black eye goes un-noticed. We all know what we are supposed to do in Sales and the Numbers do the talking. The best of the education can get you a glamorous job in Sales but I feel the new generation of Sales professionals overall, lack experience. Many of the young people I find in Sales today fail miserably because they just haven’t “lived it” and eventually they’re not staying in Sales long enough. Sales - The only way to get it is to ‘Live it’.

HOW TO LIVE IT?

Being Passionate Don’t be afraid of making mistakes and learn from them. Gaining experience is the most important part of the process. Never take rejection personally. Learn from it. Always ask “why” whenever losing a good piece of business. You may not get an answer and sometimes you may not like the answer you get, but “asking” is what real pros do; it makes you better and more confident next time around.

Understanding the Sales Process

Sales process needs to be well defined. Following are certain valuable “How to’s” that may help…

How to generate leads

How to qualify the sales leads (Suspects) as prospects

How to pursue the opportunity / sales proposition with the prospects

How to negotiate

How to track delivery of what is promised to the client (once the contract is signed)

How to service the client

Training

Formal Sales training is just fine, but it’s mostly hit-and-miss with fair to poor implementation during the days and weeks that follow the formal training.

Simulation

Buddy system, One-to-One, More Need Specific coaching, Mentoring, Interactive real life case simulation

Moment of Truth

You should be proactive in your sales calls and must possess a phenomenal memory (if not then let technology do that bit for you). Never let go an opportunity to send a seasons greetings/wishing your client/remembering appointments etc. These are Moments of truth, either you score or you loose but a moment lost to make your presence felt is lost forever – be street smart!!

Also remember that ‘You are on Stage’ and you have to be at your best always.

Master Time Management

We talk a lot about Time Management. Do we understand what it is?

Well we think that if we spend 8 hours at work then we are committing 8 hours to work. But I think what is more important is how much quality time we spend at the work place. Daily your time is spent making proactive Sales calls, taking out a prospect on lunch, sending and responding to prospect e-mails and phone calls etc. There won’t be time left for Internet surfing, I-pods, personal phone calls. The biggest non productive time spent is generally unnecessary joint sales call or unofficial visits with co-workers. Sales people are generally out of office so they can easily get away with this. My advice would be Don’t cheat, be honest to yourself.

Know your Product

To get more business you need to know your product and know it very well. Understand more of your business financial aspects. This helps new Sales pros to sell smarter and to appear better informed.

Know your Competition

It is important to know what are your strengths, what the market is like and even more interesting thing is to know the pulse of your competitor. The better you know your competition, the better you can sell against it. Start by conducting your own personal SWOT test on the market handled and the presence of competition followed by the market share. This would give a clear picture of the way ahead.

Remember ‘Success comes in Cans and Failure in Can’ts’.

Sales in this Gen Y

Is the sheen of the Sales Profession eroding gradually?

Today more clients are moving to the Internet and over to the new websites that are powered by latest technology with metasearch capability to search for offers, availability, packages and fares. Are we heading for a day when the Sales pro will be replaced by Internet shopping and 100% outsourcing to the powerful, successful 3rd party lead suppliers? There are companies already performing the back office jobs for the leading airlines very successfully. We also have companies specializing in offering Sales and Marketing services across industry verticals, for example; for hotels, cruise, and car rental companies. It is not very far when 3rd party companies would take control of the airline/GDS sales, and marketing as well. After all this is the trend.

Who wants to deal with inexperienced rookies anymore?

Sales professionals today have limited access to the best clients. The rule of thumb applicable here is that ‘80% of the business is generated from 20% of the customers’. Today the 3rd party service providers are so influential that they inadvertently “block out” less experienced Sales professionals.

Is the sales profession at risk of becoming extinct?

My personal opinion, I believe there will always be a need for product savvy, service-oriented Sales professionals contributing towards the growth of the organization. Now it is high time for this community to stand up for their pride before they are not required at all.

Travel distribution in newer dimensions

2006-11-04T18:06:00.000+08:00

Keeping pace with the ever-dynamic nature and requirements of the new age traveler it has become mandate for the travel management companies to change. The small mom n pop / corner shop is no exception. The travel business is on a boom and the new business models are revolutionizing the contemporary means of doing business. This is indeed a challenging time of the legacy businesses to upgrade and deliver to the demand. The liberalization in economic policies has resulted in exponential growth potential.

New Business Strategy – Up Stream

The success of the low cost / no frills airlines is a good example of – ‘how thinking out of the box’ helps. This has opened newer avenues of reaching the client directly; bypassing the dominating travel agent community, which was not well received initially but eventually, the idea sold and did wonders for the early starters. Incidentally we can see that there was a B2C business model being implemented in the travel vertical, which was very popular in the retail sector.

New Business Strategy – Middle Tier

This was then recreated in the Middle tier (TMC/Travel agency) where there was clear need for consolidating the travel with leisure requirements. The role of a travel agent has been Travel planning and to offer their expert services in paving the path for a memorable get away or a suitable package. Study shows that with the increase of the Internet and the awareness of the travel products, today 8 out of 10 travel bookings are made online. Therefore the new generation TMC’s of the world decided to reach the customers where they are and offer their services online. Technology today makes this possible for the customers/buyers to visit the website, create their own multi-product itinerary (Air/Hotel/Car), make payments online and even print tickets and vouchers. Technology companies and TMC’s have joined hands in developing solutions, which are highly intuitive suggestive engines on the lines of Amazon.com. This allows the possibility of prompt cross-selling and ability to increase the size of transaction.

New Business Strategy – Traditional IT Enablers

The Predominant mediator between the Travel Principal (Airlines/Hotels) and the Travel Management Companies has been the GDS.

GDS - Global Distribution Systems comprise of Central Reservation System, which helps bridge the gap and provides real-time access of the travel inventory to the Bookers. This happens by a scheduled release of airline fares to all the GDS through a central body ATPCO and controlled access to the airline systems for bookings and confirmations. The Airlines today are in a comfortable position where they reach the clients directly using an ASP model compromising with the cost of inventory distribution on GDS. With the new business models the GDS business seems to be ones bearing the entire heat.

The way ahead for the GDS is to upgrade their legacy systems and to provide Converged/ Integrated, Open Source, End to End booking solutions to the evolving Travel companies.