True or false: Nearly half of all travel bookings made during 2016 will take place offline via phone or in-person with the assistance of a travel agent or travel management company.
True, which is surprising, especially given the highly connected nature of today’s travel industry and the capability for travelers to complete complex, packaged bookings on their smartphone or tablets. In fact, according to a recent survey published by Euromonitor International, roughly 44 percent of travel and tourism-related bookings will be completed via desktop or mobile devices during 2016. While this is significantly higher than other retail industries, it can be something of a shockingly low figure considering how hard the travel industry has worked to align itself with mobile technology capability.
However, what’s perhaps more stunning in the Euromonitor International report is where industry analysts suggest mobile travel bookings are headed in the near future and the impact they’ll have on the travel industry in the coming years.
The report indicates the travel industry will have the highest percentage of mobile bookings across the entire retail landscape by the year 2020 - a total gross of more than $270 billion worldwide.
In addition, Euromonitor suggests the lodging and accommodations sector of the travel industry will experience a 8.6 percent growth rate in mobile bookings through 2020 compared with just 1.6 percent of growth via offline bookings.
These figures alone highlight the importance and widespread acceptance of mobile technology for travel companies in order to remain competitive in the short and mid-term future. Yet they only tell part of the story in terms of how mobile travel bookings could potentially impact the way travel companies and customers interact and conduct business during the next five or so years.
With this in mind, here are a few other key takeaways from the Euromonitor report that illuminate how crucial mobile booking technology is for travel companies and why leveraging this capability is a value added proposition.
Mobile in Emerging Markets
We’ve discussed in previous blog entries how travel companies can appeal to new customers pools in emerging markets, as well as which of these markets show the most promise for the travel industry at large. Mobile technology and the rise of mobile bookings go hand-in-hand in creating a strong foothold in these emerging markets, especially as the profile of travelers and tourists in these markets skews more toward younger populations with tech savvy mindsets. It of course makes complete sense that Euromonitor identified several emerging markets in Asia, Europe, and South America as prime candidates where mobile technology bookings are expected to increase sharply by 2020.
According to the report, Sweden is projected to have roughly 40 percent of all its travel bookings completed via mobile technology by the end of the decade. Japan, Egypt, Brazil, and Portugal are also expected to see sizable bumps in the percentage of mobile travel bookings, especially with the rise of more affluent, travel-minded populations with enough disposable income to experience travel. The ease and convenience mobile travel booking provides is also expected to facilitate a greater interest in outbound travel and tourism in these emerging markets.
Digitally Promising Markets
Euromonitor identifies several countries in the report as ‘digitally promising markets’ where the digital landscape and makeup provides fertile ground for travel companies to engage with customers and position their products and services most effectively. While this digital promise includes both desktop and device-based technology, the report also breaks down individual sectors of travel and tourism booking where there is the greatest potential for growth in mobile technology - for example, categories like lodging and accommodations.
The report identified Canada, Indonesia, Mexico, Poland, and the United Arab Emirates as the five most digitally promising markets and highlighted areas such as direct airline bookings, direct hotel bookings, tour operators, and online travel agencies as elements of the industry that contain the greatest potential for growth via mobile capability. While these countries may not spring to mind immediately when discussing the potential for mobile tech, they do represent a fairly accurate portrait of the diversity of modern traveler and their expectations and desires for mobile booking.
Though widespread acceptance of this element of mobile booking technology has yet to be fully-realized, the incorporation of the ‘buy now’ feature on social media websites like Facebook and WeChat has seen some traction in recent years and could see more going into 2020. Perhaps the ultimate in convenience and ease, this feature allows travelers to essentially complete bookings suggested for them based on internet browsing habits, past transactions, or even abandoned travel bookings. According to the Euromonitor report, travelers in countries such as India, China, and Indonesia showed the greatest tendency to complete travel bookings via such a social media application, with European countries like France and Germany rounding out the list as populations least likely to utilize this feature.
As we’ve seen time and again in recent years, the rise and proliferation of mobile technology in the travel industry is helping redefine what it means for travel companies to be agile and responsive in a global marketplace. But this trend is also helping shape and inform what travelers seek in completing a booking and the level of customer engagement and interaction they expect from travel companies as they research, purchase, and review products and services. And if the Euromonitor report is any indication, mobile technology is primed to become an even stronger tie between the travel company and the traveler in the very near future.