Online travel buying: Increasingly, it’s about trust

This Tourism Week 22 September 2010

On-line bookings’re growing faster than a politician’s bank account – in South Africa as much as in the rest of the world. And that won’t surprise anyone – after all, tourism has always been a leader in computerised reservations technology. For the big players, the CRSs (computerised reservation systems) of thirty years ago have given way to the GDSs (global distribution systems) of today. And their stats are literally staggering: according to a PhoCusWright white paper (The Role and Value of the Global Distribution Systems in Travel Distribution),  the GDSs processed more than 1.1 billion transactions in 2008 – which accounted for more than US$ 268 billion in global travel sales. And in that year in the American market, they accounted for more than one-third of all travel supplier revenue, and two-thirds of all airline passenger revenue – whilst in Europe, they generated more than one-fifth of all traveler supplier revenue, and nearly half of all air¬line passenger transactions.

But here’s the thing: the GDSs aren’t directly available to the public – which implies that travellers whom they’re reaching are buying from professionals who know what they’re talking about, and who’ve probably recommended the product.

Not so for the internet – where the buying’s either direct, or via the booking engines.

Interestingly, the South African site Travelstart recently reported that its transactions had grown by 30% in the first seven months of 2010 – despite challenges like the economic crisis. And this on top of a 90% increase in 2009 (which sure bucked the international trend: the global industry shrunk by 4% in 2009).

According the site’s founder and CEO, Stephan Ekbergh, these numbers prove “what we’ve known for quite some time” – that more and more South African travellers are doing both their research and their buying online.

But he cautioned that “travellers are demanding an uncomplicated, reliable and accessible commercial marketplace… where consumers may easily compare prices and services, and make informed choices about where, exactly, to spend their money.

“People want to take charge of their travel arrangements and itineraries,” he said, adding that they want “a one-stop service that offers broad comparisons of flights, accommodation, car hire and all-inclusive travel packages both domestically and abroad.”

With a little over 5.3 million South Africans now connected to the internet, he said, “online booking is emerging as the norm rather than the exception.

“This is the future of the travel and tourism sector, not only abroad but also here at home, too. However, no matter how much online travel planning and buying grows, people will continue to demand reliable and efficient service and strong brands in which to believe and in which to invest. Robust, sustainable growth will demand the delivery of all this.”

Yes – but.

I can’t help remembering a post on hotelmarketing.com from back in the good old days (2007, to be precise, when tourism was booming): ‘Latest Statistics Prove Trust is a Must for Travel Sales.’

“Classically, travel purchasing decisions were based on brochures and travel agent advice – in both instances professional sales speak. Now with the rising number of peer group reviews and content from sites like Tripadvisor, a travel marketer’s spin is more easily exposed than ever before.

“The winds of change are now favouring the consumer, as recent EyeforTravel research of young UK professionals revealed. 72% said that their online travel choices had been influenced by other consumer reviews, and 63.8% occasionally use CGC in their buying cycle.

“This statistic is backed by a recent boo.com survey, which found that one in every six Brits will post a review following a holiday.

“Quite simply, people believe people who are like themselves.”

… Which is why I think the Aquila Private Game Reserve’s move to bookability via Facebook is genius and timely (go to www.facebook.com/aquilasafari, and click on ‘Book Now’ – it takes you through to their Nightsbridge page).

People on social media sites like Facebook talk about everything – not least of which, their holidays. And if a property has hundreds of Facebook friends – the implication is that they’d recommend it. (Which, of course, is why tripadvisor is so useful. In fact, I wonder how many people today DON’T begin researching their holidays by checking with tripadvisor?)

And this is where the challenge lies – for the little mom-and-pop B&B as much as for the TravelStarts of this world: gaining the trust of the buyer. And, perhaps more importantly, gaining the trust of the buyer’s peers.

Those who do, will win.