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Interview: Online Travel Agencies’ Work to Help Airlines Create and Capture Demand
As COVID-19’s effects on the international travel and tourism industries have dragged on for the past nine months, airlines and hotels have grounded aircraft and closed rooms, hunkering down completely in mid-2020 and working to reinvent themselves almost entirely. The ecosystem of companies that gets customers from the first search of flights to the relaxing beach or bustling cities — extending far beyond just the customer-facing airlines and hotels — has felt these changes as much as any.
Prospective travelers are searching for flights but not booking them, browsing hotels without committing, many waiting for a promise of a vaccine or more assurances their travel will be safe and worth the money they’ll be forced to shell out. Few companies are as ingrained in this battle as online travel agencies, companies that effectively serve as brokers between airlines, hotels and car rental companies on one side, and consumers looking for the best deal on the other.
Seattle-based Expedia is one of the largest players in that space, a multibillion-dollar company that makes its money off both the millions who book their travel — whether by car, boat, or plane — through their portals and travel partners for whom Expedia represents an invaluable partner in understanding the market that lays before them. Expedia’s Vice President of Global Air Partnerships Julie Kyse said in an interview with AirlineGeeks that she believes that the job Expedia is doing is shaping the aviation industry now as much as ever.
“People are traveling, so we’ve got a lot of data,” she said. “We still have a lot of data. We’ve also been able to share with [airlines] information about what people are searching for with regard to vacation rentals or hotels, and some of our airline partners have brought that into their network planning process to think about where they might want to stand up flying or dial it down. So it’s really been pretty collaborative over the last few months.”
Battling with Falling Demand
Expedia has largely faced the same problems as most airlines, with customers who continued to search for their next big vacation but were increasingly unlikely to pull the trigger. Kyse said that the company first had to look for ways to show the customers the information they now needed, which, more than ever, meant airline health- and safety-related policies.
In a normal year, Kyse would be working with the around 500 airlines that have contracts with Expedia to help them figure out how best to achieve their goals in relation to bookings and industry trends. But this year, her team has spent a lot more time examining what customers are looking for as airlines increasingly look to cater to passengers in an attempt to woo what little business exists to their flights.
“In the initial first days of the crisis, it was all hands on deck trying to figure out what was going on,” Kyse said. “We got 3,000 policies from the airlines about how to cancel, cancel for refund, cancel for credit, all of them have their individual nuances. So a lot of the initial stuff was going back and forth with the airline, first to clarify to make sure we understood the intention of their policies, and some cases to influence them to have more consumer-friendly policies as well.”
Kyse also believes that a number of the more consumer-friendly practices will stick around, even after the COVID-19 pandemic.
“I think there’s a few things that are happening,” she said. “The flexibility piece will persist because, since airlines have announced they’re removing change fees on more and more of the standard economy offerings, that will be a big part of it. And that’s going to change how people look at travel, as well. I think it will definitely dissuade people from buying basic economy, which benefits both the consumer and the airline. The full impact of that remains to be seen once the ‘travel with confidence’ policies start to go away.”
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