Nav­i­gat­ing in a Crowded Air Space

Arabnet - The Quarterly - - Business -

It goes with­out say­ing that tra­di­tional brick and mor­tar agen­cies can­not sur­vive with­out an online pres­ence. To start with, the num­bers aren’t in their fa­vor. Ac­cord­ing to a 2014 study by Google, “The 2014 Trav­eler’s Road to De­ci­sion,” one third of leisure trav­el­ers and half of busi­ness trav­el­ers se­lect an OTA based on its site tools and op­tions, mainly quick and ac­cu­rate flight and fare com­par­isons. In fact, the study found that over 75% of sur­veyed leisure trav­el­ers se­lected an OTA be­cause they found it of­fered the best deals. By com­par­i­son, only 9% put loy­alty re­wards as the main rea­son be­hind their choice (tra­di­tional agen­cies’ cus­tom­ary in­cen­tive scheme). In 2015 to­tal ticket sales through off­line travel agen­cies in Le­banon reached $560 mil­lion. Of that to­tal, online ticket sales were es­ti­mated at around $80 mil­lion to $100 mil­lion, ac­cord­ing to Kur­ban Travel. This fig­ure is more sig­nif­i­cant if one con­sid­ers that Gokur­ban is the only full-fledged OTA in the lo­cal mar­ket, and it was only launched in mid-2015. Ac­cord­ing to Boutros, the online ser­vice has been wit­ness­ing dou­ble digit growth month-on-month since its in­cep­tion. This shows great po­ten­tial for online travel book­ing in the coun­try.

But an online pres­ence isn’t a guar­an­tee of suc­cess. Look­ing at the new travel mar­ket, cus­tomer ex­pec­ta­tions have in­creased dra­mat­i­cally when it comes to ser­vice ef­fi­ciency and cost. On the other hand, com­pe­ti­tion in this sec­tor is re­ally tough. “The new breed of OTAS can go live and online in only a fort­night,” said Kur­ban. These agen­cies be­gan by mush­room­ing across the world and grow­ing or­gan­i­cally, be­fore they launched on a se­ries of ag­gres­sive ac­qui­si­tions for mar­ket dom­i­nance. To­day, ven­tur­ing in e-travel would mean go­ing up against ti­tans like Ex­pe­dia, Price­line, Ho­tels.com, Uber, etc. – not to men­tion air­lines’ own book­ing web­sites that at­tract cus­tomers with ad­di­tional re­duced costs and ex­tra in­cen­tives. “Leisure e-trav­el­ing is not a com­pli­cated process; you browse, you com­pare, and you book. This is why sites like Ex­pe­dia and Book­ings.com can ac­com­mo­date large num­bers of cus­tomers,” said Boutros.

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