Over the last ten years, the traveling business scenario has changed appreciably. Nowadays selling travel products is all about’best’ rates. To sustain in the struggle to provide the ‘best deal’ and ‘best fare’ to the customers, travel business owners are forced to reduce just about all their potential profit margins.
I still remember when a service fee of $6 was a standard across online sales of air tickets. Commissions and contracts were offered to travel agents. The cancellation fee on resorts was healthy.
The development of big online travel agencies changed the rules of the business throughout the planet. Fuel prices and international economic conditions added to the challenges of making healthy margins. Traveling became the most aggressive business. Commissions dried up. Segment fees reduced and “no commission” became the new bestseller.
On the Travel Technology side, together with successful implementations, I’ve heard stories of several failures where traveling businesses were unable to derive what they wanted out of technology. The Majority of the time that the key causes of failure have been:
Overambitious technology target on a constrained budget insufficient ‘aggressive’ Travel Technology experience Poor IT staff and management, afflicted by ‘over-promise’ and ‘under-deliver’ In this ecosystem, how could a traveling business set about establishing a successful Technology Strategy for itself?
As a traveling technologist, I have many motives to say “buy my applications”, but in my experience, that is not a fantastic pitch. After carefully assessing various successes and failures in the market, Here’s what I feel I’ve learned:
Step 1: Describe what Travel Technology you Require
Well, it’s easier said than done. The majority of the time not articulating the technology needs nicely is the largest barrier in Technology Strategy. As a travel business, here’s what you can do to clearly articulate the demand for technology.
Pen down the technology needs of their organization as envisioned by the business owner / key management employees Consult with individuals external to the organization like technology consultants, Travel Technology companies, GDS account supervisors, CRS / Providers, and Travel Technology bloggers permit a technology company interview you and recommend a remedy. This is usually free most of the time. Pursuing at least one of these 3 exercises will construct enough knowledge base about what your inner Technology Strategy ought to be. Identify and validate these ideas with inputs from internal operations and marketing groups.
Step 2: Build vs. Buy?
This is regarded as the most complex question. The solution lies in dividing Travel Technology needs in three buckets.
- Out of the Box
It’s necessary to recognize your differentiator for a travel business. The majority of the time, proprietary defines a piece of technology that reduces OPEX corresponding to your business operations or is the largest revenue generator corresponding to your business model.
What is a personalized need?
Is there some part of your technology requires that could be sourced via a current technology solution, customized per your demand?
What can be from the box?
This may be the most effort-intensive part of your technology needs and may require a huge investment to construct. Finding an out of the box solution that satisfies most of your needs and configuring it according to your requirements, is a perfect way. The way to assess an out of the box solution is in itself a detailed procedure.
Now we come to another complex component of this exercise.
Step 3: Identify the Perfect budget and vendor
Identifying the perfect budget and the seller is the most frequent shopping problem in each business sector. It requires a whole lot of time and energy to reach a decision.
Let us compare technology acquisition to the conclusion of purchasing a laptop. There are many vendors to choose from. There are notebooks priced from $300 to $3000. Your decision to purchase would be formed by the life span of the notebook, and the joys of business (your job) it will guarantee.
Similarly, the continuity of your trip business would significantly depend on the Travel Technology you select. That’s the reason for identifying the perfect budget, and the seller is a complicated decision.
I would try to breakdown the process of identifying a seller into easier steps since just asking a vendor for a quotation wouldn’t necessarily help find the best one.
Experience – Does the seller has experience in the travel business?
Support & Servicing – Traveling is a service business. Irrespective of whether the item is ‘off the shelf’ or has been built for you, longevity and promptness of service is critically important to maintain a personalized quality of service for your clients.
Customization needed vs. Customizability – What’s the future customizability of this program? (Applicable to both from the box or custom-built software) Whether customization is done now decrease the future price of altering the technology? This is a significant question to ask and find answers to.
Value Add – Another significant test parameter for choosing a vendor is to assess what part /component of this program can be obtained for free and would remain so in the future.
Stability – Your guarantee of support to your clients is based upon the stability of your seller. It’s very important to seek answers to questions such as is the seller going to be in business for long? How are you guarded if a vendor goes out of business?
References – Who are the customers of the seller? Can the vendor provide references?
Maturity – Is the seller’s company a product-oriented and innovation-driven institution or do they live by earning money from 1 gig to another?
Empathy – Does the vendor considers your business as their own? How willing is the seller to empathize with your business challenges?
Budgeting for technology can be a bit challenging. It could be worthwhile to check past the onetime fee and comprehend all cost factors, including the price of extended support the seller may provide during your business life-cycle.