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12
Apr

Zomato makes dramatic turnaround, attracts big investment

Posted by on in Industry News

In 2016, India-based online restaurant guide and food delivery business Zomato was scaling back business, including in the UK and US, and recorded a pre-tax loss of $73m for the year end to March.

Fast forward two years and the picture is very different, with the company raising $200m from Ant Financial, the payment affiliate of Chinese e-commerce giant Alibaba, while Morgan Stanley is valuing the company at $2.5b and predicting it could be worth $6.7b in 10 years.

Founded in 2008, Zomato spans B2C operations – restaurant reviews, table reservations, and an advertising product – and B2B – including a cloud-based point of sale platform for restaurants and a back-end for online food delivery services.

Its restaurant search and discovery app provides information for a million restaurants across 24 countries, and its particularly strong presence in South-east Asia and the Middle East is believed to be key to securing the Chinese funding. Info Edge continues to be the major shareholder, with a 31% stake.

Certainly, Zomato is looking punchy. While the 2018 financials are not yet out the company made claims last September that it is becoming profitable and CEO Deepinder Goyal recently Tweeted:

Zomato’s hit $100m annual revenue run rate this month. 40% growth in just the last two months. Loving the momentum. cc @mukund1981 @gauravg1181 @deeppurpled @gunjan2307 @elegantlywasted @akshant_g @tukster16 (?x 100 x 1e6)

— Deepinder Goyal (@deepigoyal) March 22, 2018

The company has since announced about $74 million in revenue, a growth of about 45% on 2017.

The upward trend was evident in the 2016-17 financial results, when revenues leapt 80% to $49m. This turn-around was attributed to better efficiency and cutting operating costs. For instance, during the year to end-March 2016 burn rate averaged $4.2 million a month, but by the end of March 2017 this had been slashed to $250,000.

Significant growth has come from the online food ordering segment and its subscription scheme Zomato Gold, which was rolled out in the UAE and Portugal last year and in India three months ago. Reports in the Economic Times quote a spokesperson as saying: “Zomato Gold and online food-ordering business are growing at a hyper pace for us. Online food ordering is currently about 40% of our revenues and Zomato Gold is about 12% of our revenues.”

Last month, Goyal claimed some 40% of Zomato Gold’s total sales were referral driven and that the loyalty scheme had notched up a subscriber base of 150,000 and gained 2,300 restaurant partners in the three months since its launch in India.

The thinking behind creating the membership-based service was “keeping it simple”. In his blog, Goyal said: “The key-phrase while designing and launching Zomato Gold in India was ‘T&C free’. In other words, we insisted that the product will be completely “terms and conditions free” for the end user. And we were able to achieve 99.99% of that vision.

Food delivery is seen as crucial for growth. It’s a strategic part of the payments business as it is high-frequency so it is no surprise that Zomato is focusing on developing this side of the business, starting with the Middle East and India. Tellingly, its new investor Alibaba [and Ant Financial] have invested $2m in Chinese ordering platform Ele.me since 2016 and have global ambitions.

Online ordering formed less than 20% of Zomato’s overall sales in FY17, but it has already increased the share of self-fulfilled deliveries by more than 10% through its acquisition last September of India-based hyperlocal delivery start-up Runnr. There is now speculation that Zomato could merge with rival India-based food ordering and delivery company Swiggy, which in February raised $100m funding from South Africa’s Naspers and Chinese e-commerce company Meituan-Dianping.

Last September, Zomato laid down the gauntlet with Swiggy by offering restaurants zero commission on its food ordering network in India. Under the initiative, dubbed MissionGiveBack, businesses had to qualify based on a set of predefined criteria, such as the number of orders they process with Zomato on a weekly basis, and whether their customers are happy with food and service. This compared with Swiggy, which was reported as charging restaurateurs 25-30% commission per order. Zomato has since expanded zero commission to cover restaurant bookings worldwide.

It may sound unsustainable, but observers note that Zomato’s advertising revenue – at a reported $38m in 2016-17 – can take the strain. The company’s restaurant reservations partnerships means it can also more easily tap into a variety of cuisines.

This is backed up by a blog from Goyal in September: “The company’s core advertising business in India, Southeast Asia and the Middle East, its three key regions, is generating enough cash to cover for the millions of dollars of investments the firm is making into the rest of the regions and new businesses.”

Nevertheless, the food delivery sector in India is hotting up and Zomato has faced stiff completion from Swiggy, tailed by newly merged Ola-Foodpanda and UberEats and Google Areo.

It’s also perhaps significant that since the investment fillip, Zomato has seen some strategic management shifts. Last month, co-founder Pankaj Chaddah quit the company and a new role was created, chief business officer, with Mukund Kulashekaran given the remit to spur revenue growth through both online ordering and advertising sales.

Meanwhile, Runnr co-founder Gaurav Gupta was appointed chief operating officer to oversee critical operations such as content, and new initiatives such as their cloud kitchen module Zomato Infrastructure Services, as well as sourcing and reviews.

So, Zomato is limbering up to take pole position in the reinvigorated food tech sector. Its recent investment fillip will no doubt spur the company on to further expand and introduce more product innovations and loyalty programmes to keep customers engaged worldwide.

Original author: Rosalind Mullen
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12
Apr

Sabre CEO introduces vision to eliminate silos across the company — and travel industry

Posted by on in Industry News

In the past, Sabre has held individual events for each of its business units. This year, the company decided to fold each of the individual customer events into one larger event. This move away from siloing customers into separate events underlines the company’s efforts to eliminate the traditional silos that make it challenging to develop pan-industry technology solutions.

Taking the stage in the first keynote address of the week, Sabre CEO Sean Menke laid out his vision to eliminate silos both across the company and in the travel industry. It was a vision of an industry that works together to deliver the best traveler experience, from targeted offers to a deeper understanding of the traveler’s intentions throughout the travel lifecycle.

This vision was duly emphasized in a roundtable with Sabre executives. Clinton Anderson, President of Hospitality Solutions, says that the way the company’s teams interact has shifted measurably since he started at the company three years ago:

When I started here, it was very much a holdings company. Now, the walls have been knocked down. It feels like a single company.

A focus on the traveler journey

When it comes to creating solutions that bridge industry (and company) silos, Menke points to the company’s focus across the traveler journey. Menke asked the question, “How does travel change with a complete view of You, the traveler?”

The answer involved a theoretically automated disruption management process, with each step of a journey that’s been disrupted being rescheduled using only text messsages.

While that vision is far off — there are so many different parties that have to be tied in to make that happen — the underlying message was that an intermediary like Sabre is at the center of many of these transactions. This positioning as the backbone of travel could make it a powerful ally in delivering the seamless travel vision that most travelers want.

The company wants to deliver value across each phase of the travel lifecycle, or what the company calls Retailing, Distribution and Fulfillment. These areas correspond to the various products across its business units, reflecting how the company sees its core value propositions throughout.

It seems that the company has gotten serious about shaking off its siloed past as a holding company, and is ready to deliver cross-industry solutions with fewer vertical-specific blinders. Only time will tell how this pans out — Menke is only 1.5 years into his role at the helm of Sabre, and it’s never straightforward for any company to undergo a cultural shift.

The keynote

The full keynote — including Menke’s view into the changing environment for airlines, travel agencies, hotels, and travelers — is below.

The writer’s travel and hotel were paid by Sabre. Author worked for Sabre from January 2016 to June 2017. Please read more about our ethics policy here

Original author: Nick Vivion
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11
Apr

Delta is launch customer for Farelogix availability engine

Posted by on in Industry News

Delta Air Lines has launched Farelogix’ new availability calculation engine that makes the airline the single source of availability for transactions.

Called the FLX Availability Calculator, the engine is hosted and managed by the airline and integrated into its own technology stack to provide the airline with complete control over its proprietary rules and availability calculation logic.

The airline, according to Farelogix CEO Jim Davidson, “is running the show.”

The new engine is processing all seamless availability requests – those that are seeking exact availability on specific flights — from GDSs and airline partners.

It includes the same comprehensive rules engine, FLX Rules and Offer Designer, that is delivered with the FLX Merchandise engine from Farelogix (also used by Delta and other airlines worldwide).

Delta is also using Farelogix’ Cascading Availability module for all its code-share partners, such as Aeromexico, Air France and KLM.

The module enables Delta to obtain accurate availability for its partners. “People don’t like false positives,” Davidson said.

FLX Availability Calculator is designed for high transaction volumes and supports large date range and NDC affinity search.

An optional FLX Schedule Builder engine for off-host dynamic connection-building enables airlines to optimize schedules by channel and further improve end-to-end transaction time.

FLX Availability Calculator can transact more than 250,000 flight segments per second on a single commodity server.

Farelogix expects the engine to save a carrier of Delta’s size millions in legacy hardware and transactions costs.

“We can compete with anything that’s out there based on accuracy, speed and cost,” Davidson said.

“Enabling airlines to become the single source of truth for their offer creation and delivery is core to Farelogix. Our entire suite of offer engines has been designed for speed, scalability and the lowest possible cost of ownership.”

The new standard, he said, is that this kind of advanced technology should cost less, not more.

“It makes it possible for airlines to service massive search volumes accurately and cost effectively, which is essential in today’s world of dynamic offers, NDC, meta searches and the continuing rise of mobile engagement. Availability is mission-critical.”

Another five airlines are currently scheduled for production with FLX Availability Calculator by the middle of 2018.

Original author: Michele McDonald
©tnooz.com
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11
Apr

Octopus arms itself with $95 million in funding from Alipay parent

Posted by on in Industry News

This is an article from TravelDaily China.It appears as part of the tnooz sponsored content initiative.

Octopus has announced the completion of $95 million C round of funding.

The new investors for the round, Alipay parent Ant Financial and CCB International, will also participate in Octopus’s new S2B (Supply Chain Platform To Business) strategy.

Octopus, founded in 2012, is an online travel distribution platform that offers a wide range of products including short and long-haul domestic tours, outbound tours, free independent tours and cruises.

Currently, Octopus has 10 offices in cities including Wuxi, Anhui, Shanghai, Zhejiang, Qingdao, Xinjiang among others covering more than 40 departure points in China.

It plans to achieve nationwide coverage by 2020. The platform integrates more than 60,000 travel products, with nearly 2,500 suppliers and over 16,000 distributors in and outside of China. Its transaction volume in 2016 exceeded $715 million and it served 3.3 million users through various partners.

In March, Octopus launched “Longsnout Catfish”, its first domestic long-haul brand featuring direct connection to destinations, ground mobility options and a real-time superior supply chain for resource integration.

The brand is seen as critical for the S2B initiative and has taken hold in 15 cities across China.

Octopus previously raised almost $24 million in its Series A round in November 2013, followed by $27 million in its Series B round in August 2016 from Tempus Global and other existing stakeholders.

Tempus invested RMB 50 million in exchange for a 4.17% stake in Octopus.

Original author: Sponsored Content
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10
Apr

KLM expands its digital marketing territory into podcasting

Posted by on in Industry News

KLM has earned a name for itself in digital media, particularly YouTube and other social media. Now it is expanding its territory to iTunes and Spotify with podcasts that describe journeys that changed lives.

The podcasts are unusual for an airline marketing department. They mention flying only in passing. They don’t focus on fun holidays or luxurious resorts or any of the enticements that are part of the normal travel industry repertoire.

Rather, they explore how a trip can lead to self-discovery, occasionally in a gut-wrenching way, or how it realizes the traveler’s life goals.

KLM is briefly mentioned only in the introduction and ending of the podcasts. Yet Natascha van Roode, head of global marketing communication, believes that the series, titled “The Journey,” will strengthen the KLM brand.

The marketing strategy is “subtle,” van Roode said.

“We try to touch the audience. We always try to look for the emotional level.”

Van Roode notes that apart from the less enjoyable practice of repeating “KLM, KLM, KLM,” the carrier simply doesn’t have the big marketing budget of an Etihad or Emirates, so it has to be more creative.

Through the use of sound effects, for example, it has invested in making the podcasts similar to “listening to a play” to hold the listener’s attention.

In the first installment, Linda Nijlunsing chronicles her experiences as a young Dutch traveler who found her way to Alaska, found the improbable love of her life and bore a child in the most inhospitable of circumstances.

The sounds of rushing water and crunching snow give the podcast a “you are there” feel.

The second in the series follows a young man of mixed race, mixed religion and mixed nationality who spends his formative years in Africa and never hears the term “stand-up comedian.”

Yet that is what he becomes, almost by accident.

The third installment is in production, and van Roode is looking to involve customers in future episodes by inviting them to submit stories of their own life-changing journeys.

Elsewhere, the carrier has found a relatively easy path to the emotional level in Christmas, which has resulted in a large number of flashmob and other videos.

“Our most successful video was ‘The Bonding Buffet,’”van Roode said, in which 20 solo travelers – total strangers of assorted nationalities — gathered around a table at Schiphol airport just before Christmas.

The table, however, was about 15 feet above their heads, and not until the travelers discarded their shyness and began taking seats did the table begin its downward descent.

Only when all 20 seats were occupied was the beautifully set spread lowered all the way – and the ice was broken.

If The Bonding Buffet was KLM’s most successful effort, “KLM Lost & Found Service,” released three years ago, was among the most memorable.

The star of the video, Sherlock the Beagle, demonstrates his ability to hunt down owners of lost items, such as cell phones, at Schiphol by tearing through the huge airport at impressive speed.

ABC News in the US picked up the story, and the video went viral.

There was only one problem: the whole thing was staged. The world of aviation fans divided into two camps: those who believed that a beagle could pick out a previously unknown cell phone owner at Schiphol, and those who said, “Nope. Not real.” Some people defended their opinion passionately.

Van Roode said she learned her lesson. “Everything has to be real now,” she said.

Even if it is the cutest dog ever.

Original author: Michele McDonald
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10
Apr

Blue Sky transport: From the earth to space and home again

Posted by on in Industry News

Visionary designers shared their insights on the future of transportation, from automated cars, to high-speed rail and Hyperloop, on to adventures in orbit during the opening session of the Passenger Experience Conference in Hamburg.

Richard Chung, vice president, innovation and design for automotive seat maker Adient, which is making its entrance into the airline industry through a partnership with Boeing announced earlier this year, shared a vision of an automated car interiors designed for the purposes of riding, not driving.

He explains that transport as a function of life will override any need for automotive ownership in current generations, saying that children born now may not even apply for driver’s licenses.

While he sees some hurdles along the way before the majority of vehicles on the road are self-driving, the elements required are already falling in place.

“Technology is converging and the convergence of IoT, artificial intelligence and data are driving progress.

“There’s also a cultural shift. Consumers are changing their values. Owning a product is no longer a priority. It’s about having the experience…there’s also a change in our behaviour in terms of having things in an instant. Media, entertainment, shopping, urban mobility…everything needs to be instant so that we can save time to do the things we care about.

“What consumers really want is a seamless transition from door to door…What we see is the convergence, even of personal mobility and [transport] drones in future.”

Chung believes that the push forward will come from the companies already working on this type of transport for the future.

“An automotive company, or a company like Uber or Lyft or Didi in China. It’s ready for deployment as early as 2020. Tesla is already upping their game to get up to Level 3 self-driving. The technology is getting up there. It’s not quite there yet because it requires infrastructure..including the 5G network to get there.”

While we don’t perhaps think of advances in connectivity being a key hurdle to automated cities, the volume of data required to keep self-driving cars on track in a day-to-day transport function makes high-speed mobile data transfer being available in cities nearly as critical as having roads.

transport autonomous

The Passenger Experience Conference 2018 highlights future transport modes

Paul Priestman, principal of London-based design firm Priestmangoode, which has long been involved in transport design including tubes, trains, and planes, shared the firms designs for high-speed rail travel and for Hyperloop travel.

In addition to the vital function these will play in getting humans around over long distances, Priestman also points out that these developing transport methods, including high-speed rail will reshape freight and logistics. Priestman also shares his agency’s elegant vision for personal product deliveries via drone.

Delivery butterflies…. by @Priestmangoode #PEC2018 pic.twitter.com/Y1QMMCLFjB

— FlightChic | ✈? (@designerjet) April 9, 2018

Virgin Galactic’s head of design, Adam Wells, teased the audience with images of what space tourism will feel like when the first paying astronauts take off. He shares some of the challenges of designing a cabin experience under the varying conditions of the journey and assured the audience that the project is advancing though the first excursion is yet to be formally announced.

Tnooz asked the speakers what it takes to keep Blue Sky grounded, without losing the beauty of it, and to plan future technology so that it delivers on its original promise.

Paul Priestman says:

“Working in rail particularly, when you’re building infrastructure that will take 30 years or so to build, how do you plan for what’s going to happen? It is a very difficult one, politically as well for the engineers. When designing trains that are going to be running for 20 or 30 years is to design them in a modular way knowing that certain aspects are going to wear more quickly than other bits and make sure that those are the bits that have the currently technology.

“Things are progressing so quickly. If you go back two or three years, you’ll see things that were unknown. I think there is disruption happening in many other sectors, not just transportation…but in the autonomous vehicle area [you have to sort out legislation]. How can governments react quick enough to allow this to happen? Because it is happening, so it’s getting to a critical point.”

Richard Chung says consumers will drive change every bit as much as innovative designers, and put pressure on both the product manufacturers and regulators to deliver on expectations.

“The consumer pulls. Take smartphones—when the first apple iPhone came out, smartphones were still a dream. The negative opinion was that it was only be 30-40% of the market, the optimists gave it 70%. But today nearly 100% of people use smartphones—and not to make calls. The technology—if it’s attractive enough and resonates with consumer needs—will move much faster.

“The autonomous vehicle technology is one example, because there is so much anticipation by the public. So much has been promised. There are issues still, in terms of safety and being predictable and secure, but consumer pull will make that happen.”

Related reading:

Looking at the future of travel with autonomous vehicles

Original author: Marisa Garcia
©tnooz.com
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10
Apr

Sabre explains blockchain – somebody has to

Posted by on in Industry News

In its 2018 Emerging Tech in Travel report, Sabre unravels the mysteries of blockchain and puts together the bits that not only explain how it works and what it means for society, but also whether and how it may be relevant to travel.

The whole report is worth reading, consider this only the crib notes to it.

Blockchain in brief

Sabre explains blockchain in a nutshell:

“At its core, a blockchain is a concept for a particular kind of database. Going back a step further, a database is just a means for storing a collection of digital information, usually in a way it can be easily be updated and searched. Information within a database can be any kind of value—birthdates, property records, biometric information, taxes, healthcare records, etc.—anything.

“There are many different ways to set up a database, each optimized for different use cases. Some databases are set up for search efficiency, some for extreme data privacy, some for redundancy, and on and on. Functionally, a database is a kind of tool, and not every tool is right for every job.

A blockchain is a new kind of database—effectively a whole new kind of tool to put in the toolbox of information storage solutions. In a world that previously held just hammers and screwdrivers, a blockchain is a wrench. It has functionality that no other database tool can offer, making new kinds of jobs possible.”

“Just because blockchain is a new and buzzworthy technology doesn’t mean its utility is universal. For certain kinds of information storage, blockchain may be superior to traditional databases, but in many cases, blockchain may not be the best tool for the job.”

Cryptocurrency

Blockchain is not cryptocurrency. It enables cryptocurrency transactions. But the rise and fall and rise and fall of cryptocurrencies, like Bitcoin, Ripple and others, has been a big headline grabber in 2018. This new currency is still confounding many and attracting scrutiny from regulators.

Here are some highlights from Sabre on the state of cryptocurrency (with a caveat from Sabre that they are only highlights and not a complete picture of this changing landscape):

Most—but not all—countries will require registration to use cryptocurrencies (no anonymity allowed). Cryptocurrency exchanges will become increasingly regulated and will likely require insurance and backing of funds held by investors, becoming more similar to traditional banks. Most countries will forbid using credit cards to purchase cryptocurrencies as a way of protecting consumers who might go into severe debt if cryptocurrencies crashed in value. Most countries will tax cryptocurrency gains in ways similar to other investments. Virtually all countries will allow participation in blockchain networks and the resultant cryptocurrency mining assets that may accrue (even if those assets can’t be spent for now).

Scarcity is good

In an effort to explain why blockchain matters and avoid the hype and buzziness surrounding it, Sabre picks on the concept of scarcity versus ubiquity of data. While most data management systems offer no valuation on the data stored in various fields—until it all becomes a muddy tangle of increasingly dense information—blockchain helps select the relevance of data and marks the datapoint that have the greatest credibility, distributing these reliable data points to fill and strengthen gaps and weak points in the chain of information. It identifies a single source of truth, and disperses that.

“Over the last several decades, we’ve increasingly come to think of digital information as cheap and infinitely replicable. Once something is digitized into 1s and 0s the cost to copy it has come close to zero: documents, songs, images. It costs a user nothing to send an email or to CC: an email to a hundred people. If a million people want a copy of the same song or image, the asset never runs out. This replicability places digital objects in contrast to physical objects, as each physical object takes up space and has a cost.

“The most exciting feature of blockchain is the true scarcity it brings to the digital world. Values stored on a blockchain cannot be copied, they can only be transferred from one owner to another. A value on the blockchain can be any asset that can be represented digitally: a monetary unit, a deed, a vote, an image, an airline ticket, a hotel room, a biometric identity, etc.”

Building trust

Along with scarcity, blockchain offers shared oversight and permanence of data transactions, which supports the creditability of the information distributed between systems. Some key excerpts from the Sabre report explain why this matters:

“The fact that anyone can see the full record of transactions helps provide oversight and transparency around data use. Even in private applications of blockchain, where participation is limited, the fact that a group of peers have full access to the data means fraud is reduced. The shared oversight provided by blockchain is usually referred to as a distributed ledger or distributed database. Regardless of the term, it means many different parties in difference places have copies of the entire blockchain record.

“Anytime a value is transferred, there is a permanent record made of the transaction. It is very difficult to undo a transaction.

“In tech parlance, the permanence of blockchain is referred to as “immutability.” Immutability simply means that a transaction cannot be reversed, an edit cannot happen unless it is recorded officially in the blockchain. Blockchain achieves this immutability by using previous blocks as the mathematical basis for creating each successive block—a process called hashing.”

The scarcity, oversight and permanence of record make blockchain useful for sensitive travel transactions of information which could benefit from a reliably encrypted form of information exchange. It’s trust. That’s why we’re all talking about it.

“Biometric identity is one of the most powerful proposed use cases for blockchain. Using a blockchain to store encrypted records of a person’s various biometric identifiers—their voice, fingerprints, hand geometry, iris pattern, facial model, gait, etc. Having an unforgeable, permanent source for matching biometric data would be incredibly powerful. It could eliminate the need for passports, driver’s licenses and other forms of identification, finally giving rise to true trusted presence—that someone is who they say they are and can prove it.”

Pants on fire

It’s exciting stuff, but as SITA also determined following its trial of blockchain exchange for flight data (another useful application in travel) there are risks involved which still need to be addressed. For one, manipulation of the base data feeding the chain—not entirely impossible—could lead to the dispersal of fraudulent information. If a trusted server which supplies information is compromised, then the single source of truth could quickly become the genesis of a lie.

There are other risks, as Sabre points out:

“A comprehensive biometric record would need to be completely secure—completely trusted—to gain broad adoption. The liability issues around protecting that much personal data are significant, and gaining consumer trust to opt-in to a central source for biometric data could be challenging because of fears over privacy.”

And here’s one to pin to the corkboard:

“Blockchains don’t eliminate the need for trust. Instead, they shift where the trust is placed and how it’s distributed.”

The benefits of the possible applications for blockchain make studying ways to minimize the risks worthwhile. The key point is that blockchain is not something to be adopted blindly, and requires a firm strategy for implementation. Also, enlist expert help when doing so.

“Sabre Labs is one of many groups at Sabre experimenting with and considering the broader impacts blockchain may have on every aspect of the travel ecosystem. Today’s keyword is ‘experiment.’ The functionality supported by platforms like Sabre’s Global Distribution System (GDS) is essential to global travel; its efficacy, reliability and security are the result of decades of work and development. Looking at ways to augment GDS content with blockchain solutions is an area of current exploration.

“Blockchain has the potential to change existing business models, but it’s too early to say how much maturity and exploration is necessary in the blockchain ecosystem to assure an effective, reliable and—most importantly—secure system for sensitive information.”

Let’s face it, Blockchain is complicated. It’s a big concept to wrap your head around. It can support new and more secure transactions. It can lead to a massive strain on the world’s electrical grid as too many people speculate in a new form of money. It can ensure a single source of truth on data. It can be manipulated into a mass dissemination of lies. It’s a technology to watch. It will change the future, but we should not trust the future blindly or rush into it.

Related reading:

SITA partners with airlines and airports to explore blockchain

Amadeus offers its take on blockchain

The what, why and how of blockchain in travel

Original author: Marisa Garcia
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10
Apr

Ctrip’s CEO on competing globally through a comprehensive tech suite

Posted by on in Industry News

This is the latest in a series of articles spun out of tnoozLIVE@ITB, recorded live over three days at ITB Berlin this March. More clips and interviews to come here, as well as on our YouTube channel.

For the first time in its history, Ctrip is going global. Despite being NASDAQ-listed, the Chinese travel giant has traditionally kept its focus on its domestic market.

Amid a growing globalization push among Chinese conglomerates — see Baidu’s splashy event at CES this year — Chinese travel brand Ctrip made an appearance at ITB Berlin, its first foreign show.

Ctrip CEO Jane Jie Sun sat with us during tnoozLIVE@ITB to discuss how the company approaches its business in a shifting global environment.

As part of her keynote on stage, Sun reflected on the three-pronged strategy propelling the company forward: a buzzword stew of artificial intelligence, Big Data, and the cloud. The company ties these threads together as the fabric for its growth outside of China, where it hopes to use its dominance to capture a greater share of Chinese traveler spending. As well as potentially serving non-Chinese customers with its technologies.

Artificial Intelligence is an area of particular note for Ctrip. The company uses its growing knowledge in this space to intelligently route calls through to its call center reps. This reduces the time it takes to connect a user with a solution while also freeing up its call center staff to help with the most complex queries.

Big Data was a key part of Jane’s keynote. She demonstrated a new product called VTM that gives real-time data visualization for traveler searches across destinations in China. This information drives understanding of where and how to make infrastructure investments, as well as allowing travel operators a new view into the live demand curve for their products and destinations. Armed with this information, these travel brands can adjust price and availability to reflect what’s happening on Ctrip.

Cloud computing, just as it does for businesses all over, allows Ctrip to ramp up its efforts quickly while also facilitating data capture and faster processing for the real-time insights that the company promises to its key travel stakeholders.

For more, watch the tnoozLIVE@ITB video below, followed by the transcript and Jane’s full keynote.

Transcript has been edited for clarity and brevity.

Nick: I would like to hear from you about the ABCs. Tell me about the ABCs and the investment strategies that you have.

Jane: We strongly believe that technology is the pillar for our business. So, we heavily invested in ABC. A stands for Artificial Intelligence. B stands for Big Data. C stands for Cloud Computing.

And together you are doing some pretty interesting products that you showed at the keynote today. Was that VTM? Was that the product you are showing?

Yes.

What made through VTM and the data that you guys are using?

We have three hundred million registered users, one hundred million active users. So, every day we look at 50TB data and customize the product to base on their consumer behaviour.

We also send this forecast to our business partners in the hotels, in the airlines, in the local attraction tickets office. So, they can anticipate and view that the infrastructure to better serve our customers.

And where does price play into that? Do you also make recommendations for pricing?

We do, we do. So for example, during the Chinese New Year when we see searches…that region will have the shortage of the hotels. So, we will give the intelligence to the hotel partners so they can adjust the price accordingly.

So you basically take the data and help people price accordingly?

Right. And also, when we see certain consumers they have certain spending limitation.

We will give them the intelligence to say, “Okay, we know you are interested in staying at an Island hotel. This Island is very expensive during this season but within your spending power we recommend the other hotel which is also satisfying to your needs”. So, both consumers and hotel partners appreciate the usage of this data.

And you make maybe bundle of packages too? Does it make easy to create a whole experience for the traveler?

Yes! Yes we do. So for example, when a customer flying from Beijing to Berlin. If he or she is using a first class or business class tickets, then we recommend a 5-star hotel for them.

Once they decide, “Oh I will stay in the Waldorf Hotel in Berlin”, then we calculate the distance between the airport to the hotel and we will send a limousine service to them. And when they settle in at the hotel, we can give them a nice shopping package. And when they decide to try some local food, we also have our recommended restaurant list for our customers.

So it’s true, data-driven personalization.

Very much so.

Let’s talk about the Chinese traveler. An 18% increase in urban travel per the World Travel Monitor. But you have said recently that you also want to increase your share of domestic travel. Obviously, Chinese people are also exploring their own country. So, how do you see or how are you targeting the Chinese traveller as they evolve? How are you targeting these travellers in different ways?

As we can see, the per-capita income for China is increasing significantly. Secondly, the visa restrictions for Chinese travellers are being lifted. Thirdly, there are lots of direct flights from China to the rest of the world. All these factors place in favour of outbound travel.

We try very hard to listen to our customers and listen to their pain-points and make sure we present them with a comprehensive product offering. Because of the language issue, when Ctrip pre-screens certain products for them, the customer’s users experience is good.

So, if I am a hotel and I want more Chinese travellers, how do I go about getting verified through Ctrip. Tell me what I should do.

The hotels, we have very good experience during the Chinese New Year. One of the hotels worked very hard with our team. So, they are prepared with red envelopes for Chinese customers. They upgrade our customers whenever there is a room available and also they offer Chinese food for breakfast.

All these combine together, make it very attractive for Chinese travelers. We very much like to work with the hotel partners, airlines, local attractions, in this market and give them the data we have seen. The pain-points our customers have experienced. They will stand-out as the most welcomed resources for Chinese travelers.

And then, they get more travellers right? They get more inbound Chinese.

Exactly. Yeah.

Ctrip in two years, where do you want to take the company? Where do you see yourself going with it?

The GTP growth rate for China is about 6 to 7% and travel industry doubles that at about 10%. And our growth rate normally can double, triple that number in the long run.

So, our team is very dedicated to making sure we offer the best product, the best service, the best technology to our customers.

The focus for our team has always been on three items. The first one is the technology. We hire a lot of people from the Silicon Valley and from the best universities in China.

The second thing is the product. We have baby-tiger program continuously innovate new products to bring into our product offering.

The third one is the service. We offer 24/7 non-stop SOS program. So, whether you have a tsunami in Japan, earthquake in Nepal or you have a shooting in Las Vegas, our system will be able to identify where our customers are within seconds. Within minutes, our team will be able to talk to the customer that’s in the region. Within one day, we can rescue the customers back to China.

So, these are kind of the services that give peace in mind when customers at travel with us. So, in the next two years, I think this has still our focus. Always focus out the customers, always focus on what they need where their pain-points are and improve upon it.

One actual final question. Your focus expands to other travellers outside of China, and serving travellers from the west who want to go to China.  Is that a focus or are you staying primarily with the Chinese traveller?

When your product is very good, some of the customers, even if they do not speak Chinese, they will appeal to your product.

For example, the air ticket’s business is growing very well. We offer the best price, best service. So, although we haven’t expanded too much for the air ticket business a lot of people already write very good review notes for our product. So our belief is, if the product is strong enough, naturally people from China, and outside China, they will all tend to use your products.

To learn more about how to bring tnoozLIVE@ to your event, please email Ella Sopp.

Original author: Nick Vivion
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09
Apr

Delta Air Lines’ chat vendor discloses 6-month-old data breach

Posted by on in Industry News

The payment data of a “small subset” of Delta Air Lines customers may have been exposed when [24]7.ai, the vendor of the airline’s chat function, was hacked.

The incident occurred between Sept 26 and Oct. 12, 2017, but [24]7.ai did not inform Delta until March 28.

In turn, Delta made the incident public a week later.

Delta would not comment on the reasons for the timing of either disclosure, but it offered a timeline of related events on its website.

On Oct. 12, [24}7.ai discovered and contained the breach, which affected only payment data of customers who used Delta’s chat function on either its website or mobile app.

Other personal data, such as passwords or Social Security numbers, were not exposed.

During the following months, the San Jose, Calif., vendor worked with law enforcement to investigate the cause of the breach.

When Delta learned of the incident in March, it began working with [24}7.ai to gauge any potential impact the incident had on its customers or systems.

“We also engaged federal law enforcement and forensic teams, and have confirmed that the incident was resolved by [24]7.ai last October.”

Delta said it could not confirm whether any customer data were, in fact, exposed in the hack.

Out of an “abundance of caution,” however, it shut down the chat function and offered free protection services to customers who feel they may be at risk.

That and other information is available at a dedicated website here.

Sears and Best Buy say their customers may also have been affected.

Bills to require companies to disclose data breaches within in a certain time have been introduced in the US Congress from time to time, but the efforts – generally backed by Democrats – have stalled.

Several states, however, have passed laws requiring timely disclosure.

Florida allows companies to report within 30 days, the tightest window.

Under the European Union’s General Data Protection Regulation (GDPR), which goes into effect on May 25, companies will have 72 hours to disclose data breaches.

Henry Harteveldt, chief analyst at Atmosphere Research in San Francisco, said companies need to pay close attention to the laws governing disclosures.

“You don’t have four or five months to report these things. In this digitally based commercial environment, you won’t have four or days.”

Original author: Michele McDonald
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09
Apr

Mindful automation: these might not be the bots you’re looking for

Posted by on in Industry News

Sabre has published its latest Emerging Technology in Travel report, which looks at the top technology trends driving travel and social change over then next few decades, and considers both the applications and implications of this technology.

Here, tnooz looks  at some of the highlights that resonate most in Mindful Automation but the study is comprehensive with other valuable insights on authenticity in digital, and blockchain.

Human factors

Don’t be distracted by AI, no matter how sexy it has become. As Sabre says, AI is more a fuzzy concept which helps us express the evolving intelligence of the digital systems that will support automation.

Sabre likens the advancement of mindful automation to the industrial revolution, finding parallels in the socio-economic impacts of each. There is no doubt that automation will re-shape the workplace and our lifestyles. As our digital systems begin managing both logical and physical tasks, jobs will be re-defined and the skillsets required for work will change.

“As a paradigm shift, it may be helpful to stop thinking about business strictly in terms of jobs and roles, focusing instead on tasks and skills. Every job is made up of tasks; some of those tasks are going to be automated. Yet every worker has a set of skills, and those skills can be applied to a wide array of tasks. Valuing employees for their skillsets instead of simply filling particular roles is critical to maintaining and training—and retraining—a workforce.”

tech trends

AI is a tool, not an employee

In automation, the travel sector will find solutions to many of the infrastructure and staffing challenges that will arise with an increased number of people traveling in future, Sabre finds. Just as automation helped accommodate the growth of passengers flying by helping the airline industry move from manual reservations and flight management systems to today’s advanced PSS and GDS systems, so too will future AI-backed systems support growth.

“On the front end, travel requires a tremendous physical infrastructure—cars and planes, roads and runways, hotels and high-rises, restaurants and resorts, ports and parking lots—as well as the people to staff and maintain everything. On the back end, travel has a similarly complex infrastructure handling inventory, reservations, fulfillment, staffing, identity, security, compliance, transactions (in hundreds of currencies and point systems), translation (in hundreds of languages), and countless other details often invisible to travelers.”

It is most likely that, as Sabre suggests, automation and AI will become the new tools that workers use to perform jobs, rather than replacing workers altogether.

“Travel agents in particular may spend far less time searching through rates and optimizing itineraries and can shift their time into building and utilizing the skills to engage customers in providing a higher level of customization and service. The rise of boutique travel agencies over the past few years is demonstrating the demand for better service and more nuanced trip planning. In many cases, boutique agencies are embracing automation (through services like chatbots) to help with rote tasks and travel reminders, freeing agents to have more time to engage with travelers at any point in their journey.”

AI, Sabre suggests, will require human intervention for the foreseeable future.

“The more complex an algorithm becomes, the more likely it is to be asked to operate with imperfect information. A calculator knows it has perfect information which leads to predictable, replicable correct results. In contrast, a weather algorithm is never exactly right; it can be approximate and useful, but perfection is impossible (it would require, at a minimum, modeling every atom in the system). The problem with more complex predictions and intelligence is that it’s hard to know for sure which data is important to make the right prediction. And because we don’t know which data to account for how to prioritize the data, we can’t expect a perfect outcome. Trusting AI with increasingly complex real-world tasks—increasingly human tasks—requires accepting imperfect outcomes. Adopting higher-intelligence AI algorithms will require humans to reevaluate acceptable levels of risk and continually reassess our tolerance for imperfections.”

Machine learn optimus cosi tutti-frutti

Any suggestion that machine learning is a panacea to advancing AI misses the importance of human oversight to validate the data which is fed into the algorithm and also to filter through what the algorithm learns from the data.

This is a process which those currently engaging in the process will testify can include surprising misinterpretations and odd extrapolations by the ghost in the machine.

A good example of this is found in the post by AI Weirdness on the unusual Christmas carol compositions of a developing neural network. Practical AI applications will require significant and time-consuming human scrutiny. But AI has its uses in processing massive volumes of data.

“One yet-to-be-realized promise of AI and automation is truly personal preferential filtering. This is a key opportunity for the travel industry to use AI: to work toward personalizing every aspect of the journey for the traveler, making every trip a bespoke experience.”

AWESOM-O, your robot friend

Despite helpful bots and physical robots, human concierges and agents will play an important role in building trust in travel. Sabre predicts that automated service agents will become tools that enhance human service.

“A hotel chatbot or in-room digital assistant can serve as a frontline for guests, answering basic questions, making spa and dinner reservations and recommending local attractions, etc. The digital concierge can alert a human concierge of opportunities to improve a guest’s stay. Similarly, a concierge bot should have the capacity to monitor social media channels to flag opportunities for a human concierge to both solve potential problems and affirm positive guest experiences. Augmentation of human capacity and human skills is a key role for future automation.”

Sabre also offers an important cautionary note of the brand image and legal risks of relying too much on automation for personal services.

“One under appreciated value of the human concierge (and similar service roles throughout travel) is the ability to act with discretion and without complete data support. All digital assistants are powered by data—the more specific data they have about a person, the better their algorithms can optimize recommendations and predict user needs and behavior. Digital assistants need data to be effective.

“However, data privacy laws prominently in place in Europe and emerging in other parts of the world, along with increased concerns over data breaches and cybersecurity, could complicate the efficacy of digital assistants. Many people are skeptical of how widely they share their personal data, and how widely their personal data may be used without their knowledge.”

Baby, you can’t drive my car

No discussion of automation is complete without considering its future impact on transport. Sabre suggests that it will grow in proportion to how quickly cities build the new infrastructure required.

“In the real world, adoption will be very uneven across the globe, at least for the next few decades.”

Recent incidents with automated transport trials show that there is a risk to blending automation and humans—often as a result of the unpredictability of human behavior. For automated transport to work at its best, cities will have to be smart first, with better signage and better pathways.

Original author: Marisa Garcia
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