06 August 2009

We're Not Going To Take It...

Never did and never will...

OK so call me an old WHO fan - but I find the news that Travellers are pissed off with Travel Booking Sites a revelation of stunning proportions (not).

I have great respect for Forrester's research and for a mere $499 you too can get a copy of the study.


For once common sense seems to prevail and the world can now rest easy that Websites are still very much a 1.0 product, and in need of a major uplift. I concur with Henry's findings that the GDS should evolve but the technology is too old and creaky to do so. Not to mention that the GDS vendors are not investing nearly enough in addressing this. Further there is a nasty underlying issue that is the (one of many) issue(s) on the table as an elephant in the room.

The captive GDS model ties the OTA players to the GDS based systems. Thus the ability of the online systems to provide a decent technology service is inhibited and will be until the commercial model is displaced that today incentivizes the OTA to continue to use these old legacy systems. The same is true for the Airline direct systems that in many cases are still based on GDSs.

Fortunately change is coming. However not quite fast enough, just don't hold your breath - this will not occur until the airline/GDS contracts start to come up for renewal - look for this in 2010.

In the mean time - the smart airlines are actually prepared to do something about this state of affairs and are moving away from GDS based systems. Solutions from Farelogix, and ITA etc are making sense and are now mature enough to be implemented in high transaction volume environments. The OTAs must step up and bite the bullet to wean themselves off the GDS based model first commercially then technically. The latter is very easy - it is the GDS incentive fee meth that they have the problem with. The OTAs however are seeing their transaction value proposition decline in favor of more ad based models. This puts them in direct conflict/competition with what used to be called Meta Search engines such as Bing and Skyscanner etc. Surprise, surprise the OTAs are not necessarily winning that particular battle, at the same time - the consumers are using more and more the supplier direct sites - thus the OTAs are fighting a multi-front war.

But, dear sisters and brothers, let us not forget the traveller who has become MUCH smarter and is decidedly not happy with the tools in place at the moment, nor is he happy with the way he is being treated by the suppliers, the intermediaries and their technology solutions. Fair notice, he/she will move to where he is treated better. Loyalty counts for now't (nothing) in today's economy.

You have been warned.


1 comment:

Alexgander said...

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