Seize opportunities, focus on customers

Let's get through this together, say travel leaders at WIT & ITB Asia

Airline loads are down and carriers are cutting capacity, while multinational corporations have frozen travel. Global Distribution Systems across the region are reporting declines in numbers of bookings.

But within the halls of WIT (Web In Travel) and ITB Asia, held back to back in Singapore from 21 to 24 October 2008, travel industry leaders and professionals maintained an upbeat mood in their discussions on future trends and issues that would shape the new Asian consumer.

"Crisis always opens new opportunities to change the way we do business. In a crisis, companies must get very focused on customers' needs," said Mr Gerry Oh, Regional Vice President-Southeast Asia & Australia, Jet Airways (India), during a panel at WIT.

Panellists said values, loyalties and customer priorities change in a crisis. "The crisis translates into budget constraints for consumers. It generates new market segments with value being very much the message of the day," said Mr Roland Jegge, Vice President Asia Pacific, WorldHotels.

Marketers also said that in difficult times, it is often the bold companies that emerge stronger. Referring to HSBC Bank, which at the height of the financial collapse, became the single biggest advertiser in the history of New York magazine, Ms Kathleen Tan, Regional Head-Commercial, AirAsia, said those who dared would win.

She said that in times of fiscal uncertainty, boosting advertising and PR activities would help to build up brand loyalty and stimulate consumer confidence.

Mr Gordon Locke, Vice President, Airline Marketing and Strategy, Sabre Airline Solutions/Sabre Travel Network, said that travel companies had to work even harder to sell the idea of travel as an escape. "We live in stressful times and everyone needs a holiday."

And in this context, Asia will benefit as a destination. "Hotels, spas and destinations around the region are perceived as high-quality, stress-free tourism products."

A necessary adjustment

At the ITB Asia Convention, hotel leaders also affirmed that it was not all doom and gloom, but that there was room for reasonable optimism.

"There is an emotional reaction to the ongoing financial turmoil and the crisis. I expect that it will soon resolve itself," said a confident Mr Apo Demirtas, Chief Sales and Marketing Office of the Jumeirah Group. 

The sentiment among the executives was that all hoteliers have to evaluate precisely the impact of the crisis on their businesses, show flexibility and adapt. "There has been a lot of overheating in the real estate and the current adjustment was probably necessary," said Ms Jennie Chua, President and CEO of the Ascott Group.

Then there are those who seize opportunities in crisis. For Mr Loh Lik Peng, owner of both the New Majestic and 1929 hotels in Singapore, and Ms Yenn Wong, owner of the JIA Boutique Hotel in Hong Kong, Asia's previous financial crisis in 1997/98 allowed them to venture into the hotel business thanks to the collapse in the real estate market.

In the current economic climate, consumers and business travellers will seek savings. "People will become less 'showy' in their hotel choice. They will look for more value-for-money options," predicted Ms Chua, whose opinion was shared by both Mr Issenberg and Mr Ko.

Mr Issenberg predicted that the corporate market will really look twice before booking "showy" hotels. Mr Ko predicted a downward trend for all hotel segments, especially between the lower level of an upmarket hotel and the upper level of a middle-market hotel. "Nevertheless, all segments will be affected at various degrees," he said.

But the Middle East may be the exception. "We do not see any slowdown in our business in the Middle East," said Mr Dermitas.  There is still a demand for luxury and we continue to expand abroad to offer our guests the same level of service and luxury they are used to at our Jumeirah Group properties."

Mobile way to go and then there's virtual

Moving to the future, speakers at both events homed in on new technology and tools that suppliers could use to engage with the customer.

Social networking tools which allowed for user-generated content and rich media - videos, maps, etc - could be used by travel suppliers to enhance the user experience online and differentiate their brands.

Mobile is the new darling. Mobile devices have become powerful converged devices and have become "the Internet wherever you are", said Mr Mahmood Kalantar, Director, Nokia Mobile Software Sales and Marketing at WIT.

Mobile, he said, brings context to Internet services, allowing users to access Web services everywhere and suppliers to target customers

His views were echoed by Abacus International's President & CEO, Mr Robert Bailey, who said that harnessing the new technology available for the mobile platform must be a central part of travel agents' strategy for growth.

With some 1.5 billion mobile subscribers in Asia Pacific, the sheer penetration makes mobiles a powerful tool for interacting with consumers, he said.

At the ITB Asia Convention, Professor Adrian Cheok of the Mixed Reality Lab at the National University of Singapore took delegates into a world where virtual blended with the real world - a world of interactive, pop-up maps and guidebooks, a mixed reality tour of Kyoto where users can view maps and read restaurant reviews on their mobile devices as they walk up to the restaurant and a world where pet owners can play with their hamsters and parents can hug their children while they are on the road.

"For people always on the move, new technologies such as internet or Skype do not transfer real emotions such as physical contact or smells. The use of mixed reality with the virtual world can be a way to provide those physical sensations," he said.