During the summer of 2016, Puzzle Partner was lucky enough to become a business partner with Phocuswright, the unrivaled leader in travel intelligence and research. In their latest report titled “U.S. Mobile Shipping and Booking,” Phocuswright addresses one of the biggest challenges for travel and hospitality brands in today’s mobile-centric world; how to ensure that consumers book trips and hotels after their search process is completed and that they finalize their booking where they searched – using the mobile app.
In this insightful report, there is some incredible information that every company in the travel industry yearning to perfect their booking technology delivery mechanism should understand. Three key elements reviewed in this research are:
- How travelers shop and book
- Where they shop and book
- Why they book on mobile
One of the most interesting facts derived from this study is that people booking hotels using mobile devices has actually slipped over the past year. Air shopping and booking have too declined from 2015 to 2016. In terms of the marketing funnel, the digitally connected travel shopper is using the mobile channel for the awareness and interest stage in their buyer journey. How is this possible?
We see the impact of mobile use and its direct effect on buying in many areas of commerce. In fact, from 2014 to 2015 there was a 174% increase in mobile usage during the Black Friday sales*. The article from digitalturbine.com referenced below also pointed out that, in the retail sector, 88% of people use retail apps and for every four users that install a new retail app, one person purchased an item within the first 24 hours. Also, one in every three shoppers used their phone to make a purchase during Black Friday. These stats suggest that this area appears to be moving along at quite am impressive pace.
So back to the original question. How and why is there a decline in mobile shopping and booking for travel and hotels? One of the underlying factors behind the slight dip is the changing mobile traveler population. In the past it skewed heavily younger toward millennials, but more older travelers start to acquire and use smartphones for some aspects of travel, but not booking. This is a natural cycle in how populations adopt new technology. Makes sense. The online travel purchaser is now getting older, and this will impact habit and behavior. We will even see this propensity become more prominent as time goes on.
Smartphone shoppers tend to visit more sites to gather their information, and they are quite a bit younger. One in five smartphone shoppers are between 18 and 24, and they are not brand loyal. This is a huge concern for brands, and they will most assuredly be addressing this issue as a top priority ASAP. It also appears that airlines carry more clout than hotel brands as smartphone users are more likely to purchase tickets directly via the airlines brand.com, whereas they turn to OTAs to purchase hotel rooms. It seems that younger people prefer to book travel using mobile devices because they are comfortable using their smartphone to do everything for them. It’s their social connection tool, their email repository, their internet browser, their gaming devices, their camera and yes, it also works as a phone.
So how do companies selling travel online ensure that all the money they have spent on mobile booking apps do not go to waste? By understanding the types of traveler personas and ensuring that their messages are segmented based on these personas. It is clear that age needs to be a consideration, however personas can change based on the type of travel being booked. Is the trip for business or leisure? Are they traveling alone or with family? The list goes on and on. We need to recognize the unique nature of mobile, both in terms of the technologies at play and the shoppers’ journey. Those who can bridge the gap, offering a seamless, cross-device booking environment will be able to attract more loyal, valuable omni-channel customers. What’s important is giving travelers what they really want: instant, relevant information no matter where they are or what device they’re using.
We may see these trends change over time, but one thing is for sure, the population is definitely getting older.
Alan E. Young
Alan E. Young is the President of Puzzle Partner Ltd. and Co-founder of Next Big Thing Travel & Hospitality (nbtworld.com). Previously, Alan has held executive level positions with startup companies such as Newtrade Technologies, (acquired by Expedia), Hotel Booking Solutions (acquired by IBS Software) and TrustYou. Alan is past Chair of The Board of Directors of The OpenTravel Alliance and been very involved with other industry associations most notably AHLA, HEDNA, and HTNG. With over two decades of experience in the travel and hospitality technology world, Alan specializes in helping innovative companies achieve winning performance and dramatic growth. You can connect with Alan on LinkedIn or follow him on Twitter.