5 thoughts on executing a connected trip strategy
February 18th, 2020
Local sightseeing & experience companies are not directly going to be executing connected trip strategies however retailers, such as online travel agents, will be, and partnering with local experience providers to make this happen.
What is a connected trip?
Best to leave the definition to David Goulden, Booking.com’s CFO, as quoted by Phocuswire:
“When we talk of connected trip we’re not just talking about buying a bunch of separate things and putting them in basket and calling that an order.
We’re talking about something that is personalised, AI enhanced, that is truly connected; it’s very different from buying a few things across a tab on a website, this level of interconnectivity and intelligence between these elements of a connected trip.”
In summary the connected trip is pretty much the next ambitious cross-industry project that leading retailers are looking to deliver.
I have five strategic thoughts on this:
1 – Has to be presented emotionally, not factually
Google wins factual competitions every time. There is not much point doing a project that is designed to create space between yourselves and Google if you execute in the same way that Google will likely come at the problem.
A good example of what I mean is the problem of restaurant discovery:
- Google presents based on facts – this restaurant is open, here is how to get there
- Other services present emotionally – e.g. we for example focus on memorability – will a visit to this restaurant be memorable in two years time? Others present emotionally based on social peer pressure “Your friend John liked this restaurant when they were in New York” or perhaps “This will make you look good on Instagram” or “You need to try an afternoon tea while in London. Now is your chance”
You could create a connected trip service optimised around facts but this is going to be a competitive field. You can license facts from data providers. Facts are not in short supply.
Instead, you need to execute to such an extreme level that it becomes super challenging to make it work at all. You must bring emotion into play. This is emotion at point of discovery and emotion at point of delivery.
I expect next generation AI assistants (e.g. what comes after Alexa) and digital humans will be key to this. Turns out they, even though digital, are able to create emotional connection to users that regular apps and digital services are not:
When interacting with something that does not convey positive nonverbal cues, such as good eye contact and appropriate facial and hand gestures, we struggle to connect emotionally and put up mental walls of mistrust. When an AI assistant is able to communicate these trust-provoking nonverbals, our guard goes down and we can allow AI assistants to help us.
If Google did not exist, you would choose to execute in a factual manner first as it is far easier to execute….. But this is not an innovation in a petri-dish, you have to innovate on the basis that others are innovating on the same challenge at the same time and may even have more resources than you. One of those is likely to be Google.
You must build your differentiation in to your service from day one as differentiation is hard to engineer in later. Emotion will be how to do it.
2 – Do we actually know what elements are required to make this work?
Booking Holdings argues that they do have the right ingredients. David Goulden, Booking.com’s CFO, again as quoted by Phocuswire:
“We have most of the elements to build it – accommodation, attractions, ground transport, dining, etc., and then you need the connectivity elements – the payments, personalisation, the AI and machine learning and we have or we’re building these.”
Yeah sounds right but perhaps there is more required? Lets take a leisure travel example that also comes up in business travel a fair number of times:
Should we have the evening meal BEFORE or AFTER going to the theatre / music gig?
I have narrowed it down to 8 types of data that we need in order to assist our theoretical user with this decision:
What are the local restaurant opening hours? When will the theatre / gig finish? Will it absolutely finish on time or may there be flexibility on the end time? What are the transport options in the middle of the night?
Do we know what food the customer may want (cutting down the restaurant options). Or at the very least, do we know what food they don’t want? For example would they accept fast food that may be available all night?
Do we know if they have to be up at 07:00 the next morning. Were they up early that morning?
Business or leisure? Might be more fun to eat very late at night but this may not be appropriate if you have to get back to work the next day.
Do people generally eat late or early in this destination? The customer may accept adapting to local culture if necessary.
Has the customer set that they prefer to eat earlier or later in the evening?
Is it predicted to snow? If it was, would that influence the decision regarding eating out later or not.
If multiple people are sharing this evening experience, do we need to make the decision over the group, taking into account everyones requirements. Becomes harder when some of these inputs are not public (to the group of friends or business colleagues). e.g. if you are at early stages of pregnancy you may not want to say you don’t want to stay out late, or drink alcohol. The platform should handle this ensuring everyone’s privacy is maintained.
When you go through this list, two aspects stand out to me:
- How we mix these elements together is key – if you give the same food ingredients to a Michelin star chef as you do to me, the Michelin star chef will do a better job. i.e. Booking Holdings may argue that they have the right elements available to them but it is going to take much more than that and we shouldn’t hand them the prize quite yet
- We need to know more about consumers – to really understand our customers we need to be relevant to them 52 weeks a year so we can learn the most about them, not just 2 weeks a year when they travel. Perhaps this creates a greater opportunity for Amazon, Netflix or Facebook than to travel industry incumbents. Perhaps gives Google an inbuilt advantage too.
Also my thinking is, hummm, this is not going to be that easy is it! This is just one use case. A connected trip service will have to handle tens or maybe hundreds of these situations.
3 – Connected trip is a rebrand of the failed trip planning trend from previous years
When I first heard about the connected trip concept I immediately thought haven’t we seen this before?
We now have three competing concepts all solving the same problem but from different directions:
- Trip planning – Helping customers make the right multi-component decisions ahead of travel
- Connected trip – Helping customers make the right multi-component decisions during travel
- Super-app – A means to execute trip planning / connected trips where multiple suppliers and services can be presented in a single user interface layer. Other execution possibilities exist
Speeding up the urgency of the interaction doesn’t inherently make the connected trip problem easier to solve than the trip planning problem.
Hundreds of millions of dollars was sunk in trip planning startups, so either that was the right problem, wrong execution, or the wrong problem. The connected trip folk are betting that it was the right problem, wrong execution. If so, it is going to take an extraordinary execution this time around.
4 – Not a silver bullet for the larger digital retailers
Booking Holdings / Expedia and I am sure others all want the connected trip concept to save their businesses in the near term. It won’t.
For statements relating to the commercial importance of the connected trip, this article from Skift is the place to start.
This is a multi-partner, multi-year innovation that requires building an emotionally lead service that works over hundreds of use cases. This is just not in any online travel agent DNA.
All startups are a pain tolerance competition. Do you see these travel companies retaining executives over sufficiently long a period to deliver this? Any executive who really understands this new tech trend will find themselves a startup to join to deliver it. The politics of doing this within an already large organisation could be unbearable.
5 – Not winner takes all
Likely that every region of the world will have their dominant connected trip / super app service that consumers gravitate towards.
Also there may be connected trip services focussed on certain types of traveller – you could have one focussed on corporate travellers, another on leisure travellers and so on.
This doesn’t look like a knock out blow to push competitors to obsolesce but an iterative improvement.
Connected trip technology will be expensive to execute but the situation is that everyone IS investing in it.
In many ways reminds of the of the autonomous vehicle industry I am now in. All the vehicle manufacturers (OEMs) are investing billions of USD in self driving cars on the basis that if they do not, and another OEM does, and makes it work, that this will be a terminal problem for the companies that didn’t quite make it.
So you have to invest to stay in the game, even if you are not quite sure its the game that you want to be in.
Image: Flickr: Dirk Förster
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