Airbnb popularized a new type of rental product - i.e. the primary-residence urban rental, but now professionally managed properties are coming online with fury. Looking forward ten years, the landscape will likely look quite different. Consolidation is in the air; vacation rentals have gone mainstream with the consumer but inventory remains fragmented. Property managers, marketplaces, SaaS platforms and a host of other add-on services are evolving their strategies to capture greater scale and efficiencies.
The tours and activities segment is a two-sided race, with the big online aggregators clamoring to bring both suppliers and travelers into the digital age. The category has a relatively short booking window compared to accommodations and flights, leaving little room to use the latest in digital marketing and retargeting tech. Average booking values are also significantly lower than other categories. Yet, despite the challenges, the opportunities remain significant; the category is very much the next (if not final) frontier in online travel.
Disney’s success with its theme parks, hotels and cruise products is directly attributable to a highly-sophisticated marketing program that leverages cross-monetization of its different media businesses. It’s a case study for travel and hospitality companies on how to think and look outside of travel, when building globally successful businesses and brands.
There are over 77.5 million family households in America, with an average size of 3.26 people, and an average annual vacation spend of $3,340. It's a sizeable market and most travel memories are made with life partners, family, friends, or children when taking into account trip composition, but also during the decision-making process on where to go and what to do once there. Travel and tourism professionals should have a keen sense of modern family dynamics.
The mechanics of metasearch technology and how travel brands use it to effectively bring attractive products to market are extremely complex. While many have tried, very few are now doing it in a meaningful way that produces attractive scale and profits. Those that succeed long term will ultimately need the right mix of technology, connectivity, user experience, market strategy, and budget. This definitive report outlines the competitive landscape along all five of these essential benchmarks.
The very nature of investment in the travel startup space remains complicated. A lot of hype but also plenty of opportunity and big payouts for those who can bring together the right tech, the right user experience, for the right market segments. This report delves into what has worked and what investors should be paying attention to as we move into 2017.
Instagram and Snapchat have exploded in recent years; the user base is certainly there but at the same time, they leave something to be desired for advertisers. Visual content is also a challenge on the production side. How travel brands leverage both branded and user generated content to engage potential customers will vary. One certainty is that travel should continue to experiment with visual content and the platforms that attract millions.
Travel search and booking looks completely different today than it did just years ago. But the value-add that agents can bring to the travel experience will be difficult to obviate completely, either through disintermediation or automation. The intersection between high-tech and high-touch is now a key battle ground for travel brands the world over. Those with the customer care infrastructure to deliver could stand to gain, if they can get their digital house in order.
Expedia has a lot going for it in the short to mid term but shifts in technology and consumer tastes have disrupted the travel space before, and will do so again. Dara and team will need to stay vigilant in addressing numerous vulnerabilities, especially as they go up against the big platforms including Google, Facebook, Amazon and others.
The complex issues and questions being raised by alternative accommodations providers are proof that these businesses are no longer in their infancy, or startup stages. Despite the challenges, the sharing economy is here to stay. The almighty consumer will ultimately decide the ebbs and flows of how the business of short-term rentals plays out.
Many of Latin America's hotel chains have successfully grown their footprint in the region, despite Zika and a sluggish economic outlook for certain markets. A rising middle class and steady business traveler demand (particularly to secondary cities) are keeping accommodations demand interesting enough to keep planned expansion initiatives rolling through this period of economic and political transformation.
Much of the discussion about travel and generational divides has focused on distinctions between the Millennial generation and more mature travel cohorts. Yet, in the incessant paddle toward bluer oceans, travel marketers are now starting to look further down the horizon to align brands and product offerings with those who have just begun to explore the world through travel.