Travel distribution entering “period of unprecedented change” – report

Travel distribution will undergo a revolution in the next decade, with new technology and consumer trends set to transform how people search for and book their trips, a major new report has asserted.

The study, released this week by Amadeus and the London School of Economics (LSE), revealed a series of “future pathways” that are expected to impact travel distribution in the next 10 years. And according to the report’s author, LSE’s Dr Graham Floater, these trends could change the travel landscape as we know it.

“The travel distribution industry is entering a period of unprecedented change – with rapidly changing consumer expectations, advances in data analysis technology and a blurring of the traditional lines between the various players,” Dr Floater said. “Our report identifies the disruptive factors that are likely to shape the industry, and eight future pathways for how the industry could develop over the next decade.”

The way people book travel will change significantly over the next 10 years, according to LSE
The way people book travel will change significantly over the next 10 years, according to LSE

The “future pathways” identified by the report encompass the major trends taking place in the industry, from consumer behaviour to technical developments.

The role of global IT companies in travel distribution will continue to grow, the report states, notably through the use of virtual assistants, payment technologies and social media integration. And so-called “mega-meta-OTAs” (online travel agents with metasearch capabilities and global brands) are likely to continue expanding and penetrating deeper into the distribution chain.

The report also stated that travel distribution industry “is rapidly becoming a technology industry”, and that businesses need to take advantage of the new technologies being developed. Distribution business models will also need to evolve to encompass “shared innovation”, as the industry moves away from bilateral partnerships and into an era of cross-industry alliances.

Consumer expectations are expected to increase, making it important for companies to harness big data and improve how they target and segment their customers, and shared economy platforms will continue to erode the market share of traditional industry players.

“As consumers begin to expect more personalised content throughout their travel journey, the technology managing the differentiation of airline fares and services will become more complex. Those players who do not innovate fast enough to adapt to these changes will miss out on growth opportunities,” LSE said in the report.

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