In this podcast, we discuss the current state of the travel industry, what Amadeus and Expedia have learnt from recent traveler surveys, long-term impacts from COVID-19 that both companies think are here to stay, and what the future of travel may look like in the short-term and long-term:
Speakers:
Learn more about the research mentioned in this podcast:
· The Traveler Value Index by Expedia Group
· Rebuild Travel Survey by Amadeus
To stay up-to-date on the latest news from Amadeus, and to catch the next episodes in the Big Rethink series, go to https://amadeus.com/rebuildtravel.
To stay up to date on the latest news from Amadeus, and to catch the next episodes in our series, check out the Insights section on our website or follow us on Spotify or Apple podcasts.
In this podcast, we discuss the current state of the travel industry, what Amadeus and Expedia have learnt from recent traveler surveys, long-term impacts from COVID-19 that both companies think are here to stay, and what the future of travel may look like in the short-term and long-term:
Speakers:
Learn more about the research mentioned in this podcast:
· The Traveler Value Index by Expedia Group
· Rebuild Travel Survey by Amadeus
To stay up-to-date on the latest news from Amadeus, and to catch the next episodes in the Big Rethink series, go to https://amadeus.com/rebuildtravel.
To stay up to date on the latest news from Amadeus, and to catch the next episodes in our series, check out the Insights section on our website or follow us on Spotify or Apple podcasts.
Emma Symington 0:04
Hi and welcome to the Amadeus Travel Tech Talk podcast. I am Emma Symington, and I'll be your host for today's episode where we will explore how we're rebuilding travel. I have the great pleasure to be here today with Amadeus as president of travel Decius Valmorbida, and a representative from one of the travel industry's most influential and innovative companies, Expedia, Greg Schulze is Expedia's senior executive in travel and technology. So today, I'll be asking Greg and Decius, to share their thoughts on the current state of the travel industry. What they think travel will look like in the future, and some of the lasting impacts from COVID-19 that will believe we shape the industry moving forward. Also, we're going to explore some of the findings from research commissioned by Expedia and Amadeus, about traveler sentiment and what travelers really want. But before we get started, I would like to thank all of our listeners for joining and encourage you to check out other podcasts in this series called The Big Rethink. The whole series is focused on how the industry can recover from the impact of COVID-19, how tech can support in this recovery, and how to boost traveller confidence and trust. So let's get to it. So Greg, and Decius - Welcome, and thank you for joining today. So let's get right into it. And I mean, travel is one of the most talked about topics in the media right now across all types of media. COVID-19 has really shone light on the fact that travel is an inherent part of our lives, to see family to work to receive goods to function to function as a society, so as to have the biggest companies in the travel industry, can you share what data is showing us? Are people traveling? Where are they traveling to? What are people doing now in the land of travel? So Decius? Let's start with you from an Amadeus perspective.
Decius Valmorbida 2:03
Yeah, thanks, Emma. So I mean, we have seen the recovery of the industry led pretty much by China, and by United States, those were two large domestic markets that recovered first. And it is good to see that we had, let's say, the summer peak, and that the industry is holding. So that was one doubt that existed and could we keep the level of activity of the summer. And so far, so good. And the other good news is we see many other regions joining the party. So we see recovery. In South America, we hear we see recovery in Europe. And we see Asia, which was the region that we felt was going to be the first one to recover actually joining the club. So it's good to see that the whole world is recovering. But we have a lot more insights and details certainly from Greg, and Expedia. So Greg, what do you think about recovery?
Greg Schulze 3:02
Well, I can I can tell you first Decius that airports are busy in the US, where I've been traveling quite a bit. And our survey data does point to a swift recovery. Customers tell us that they want to travel, they're excited to travel. And the research in fact showed that in this was from the summer, three quarters planned to take a trip in the next 12 months. So three quarters of everyone survey, which is a really a big increase from what we saw just six months prior the end of 2020. Where only about half of our respondents were optimistic about taking a trip. And, and people are really passionate, right. We've been we've been stuck in our house, and people want to get out. In fact, one of our questions was really interesting. We did the survey of 1000 people around the world. And a third of our respondents told us that they would rather receive more vacation days than arrays. So this is really something that we need to do. We haven't been able to do and and people are getting out there to see the world again.
Emma Symington 4:09
That's really fascinating, Greg that people will trade their workdays for more travel days, they want more holidays, which is a great sign for the travel industry. I know from an Amadeus perspective, we've also recently published a study looking at the traveler takeaways. So I see Decius if there's something from the Amadeus side of what travelers one say no, some of these findings are similar.
Decius Valmorbida 4:36
Yeah, I think another detail, Emma, that is interesting is this has been a recovery that has been led by by leisure, no. So I think there is always the question around the business travel. When will that come back? So I think that's another positive sign that we start seeing business travel picking up again. My thermometer is not as accurate as The surveys that we have done, but I'm taking it from my personal agenda. So I'm starting to have all of my agenda booked all the way to March next year. So it means that I'm starting to have fights again with my kids about if I'm going to be around to some of the events. So at least on my personal side, I feel that business travel is coming back. And that's another positive sign.
Greg Schulze 5:26
So when will I see you here in the US Decius. We've opened the borders?
Decius Valmorbida 5:32
Oh, yeah, I'm fighting strongly to get the visa. So the impediment is getting an appointment at the embassy. So as soon as that is done, we're going to be able to meet. And it is like last time we saw each other Greg, we had this great football match that was even going on. So let's see if we can keep the level.
Greg Schulze 5:53
People are definitely enjoying the events and everything that we've missed for so long. International travel is a big one, though. And we need to figure out how to safely open borders and make sure that the logistics work well. So that it's not such a hassle to get permission to travel in and out of countries. Of course, we want to make sure that we're doing that safely. But international travel is I think the last frontier, domestic travel has been really strong for us, as you said in the US and China. And Europe has done a pretty good job of allowing travel across borders. So looking forward to the transatlantic flights and Trans Pacific flights, really, to get going here.
Emma Symington 6:38
You're both talked about some of the challenges that we need to overcome to really get back to travel in the way that we traveled before. Right. So international travel, what are some of the bigger impacts that COVID has sort of created? And that they're here to say? What will help overcome these? What are some of the changes that we can make now to help us prepare in the short term, but also in the long term? Greg, should we start with you?
Greg Schulze 7:04
Yeah. And really, it's hard to say exactly what normal is, or when we'll be back to normal. Because this is an industry a world, really, that is constantly changing. But travel is resilient. And we certainly expect people to get back to the levels of travel before too long. As Decius mentioned, perhaps business travel takes a little bit longer. But even that we're seeing really positive signs, but we need to listen and watch, we want to understand what is that friction in travel and try to address that. And make sure that our travelers are prepared, so that when they're ready to take a trip that they know what they need to do and can be excited about the experience of travel and not concerned about the the logistics. We've also learned a lot through the crisis. And we have better capabilities and better technology than we did before the pandemic. And we believe that there's always something to learn in these challenges. And certainly, the technology is a key part of that, but also the partnerships that we have, and to make sure that we understand how all of us in this ecosystem fit together, what role we all play and how we can better collaborate and build those partnerships that help us to deliver the experience that travelers want and expect.
Emma Symington 8:33
That's interesting that you've broken it down into sort of two areas of technology and collaboration. And I'd like to dive into both of those topics. But Decius is there one particular one that you want to comment on first, either collaboration, or technology, and then we'll come back to the other one.
Decius Valmorbida 8:50
Perfect. I'll obviously start with a technology aspect. I think Greg has mentioned that on this rebuilding travel, there is a legacy of COVID which is the same way as we have physical security being a key legacy of what was a 9/11. I think what we have is the access to digital passenger information. And we have on our survey 90% of travelers are willing to share information around health in order to facilitate their travel and taking those requirements and that hassle as Greg mentioned away. So I think that moving forward, the sharing of health information, a passage information, the use of biometrics, all of these technology changes will be there to stay. None of us want a new pandemic to take place. But governments for sure will be on high alert of making sure that the infrastructure is there to prevent that we have such a similar impact caused by future events that can take place. So I think that that is clearly a legacy. And the other one related to technology is how customers are willing to pay for technology. So as this is a economies of scale game, lots of companies would see in fixed cost, the best way of as you are growing, being able to have for the same cost more passengers and does drive scale. But on a downturn, as we had reality is having and being stuck on all of that fixed cost. It's complicated. So other technologies, such as Cloud, and business models of selling software as a service, where you have a downturn of economic activity necessarily translates into cheaper and lower costs and IT. I think that is something as well that everyone is looking at, and saying, How can I make my IT costs and my technology costs variable. So for me, those are the two key points that will be legacy of this event.
Greg Schulze 11:01
And that really just highlights my point about partnership, Emma, that we rely on Amadeus and other technology partners to provide that scale and those capabilities. And that's been really important through the pandemic, and certainly into the future, as we tried to deliver on that customer experience and make sure that we have the right data and that we're providing the right services to our customers. We need great technology partners like Amadeus, we also need our travel providers, the hotels and airlines and car rental companies to understand what customers are looking for. And I think right now, there's an expectation, a need for greater flexibility. And as Decius said, This scalability across systems and how we achieve a greater velocity, because everything is changing really quickly, how do we help our partners optimize in such an uncertain environment? And how do they do planning? I started my travel career in revenue management and an airline. And Decius, you know, this, it's a impossible situation right now to do revenue management, well, forecasting, in an environment like this is an incredible challenge, fleet planning, and all of the schedule changes that we're going through, these are really complex problems our partners are dealing with. And so how do we provide technology data to help them do what they need to do? And then how do we help our customers when a flight gets canceled or schedule changes? How do we help them or they need to change with the new flexibility that our airlines and other travel partners are providing? How do we make sure that that customer experience works well, in this rather uncertain environment? So that's the challenge. Now, I think we've learned so much through this, that we're actually much better than we were in 2019 at dealing with such problems.
Emma Symington 13:09
It's really interesting that you say that's the challenge, right? And so we've now seen over the last 12-18 months that travel is more of an interconnected industry than ever before. There's so many more players, there's so many more companies coming together, and we have competition and cooperation and really collaboration across the board. So, Greg, I throw it back to you of how do you see the future? Where do you see the challenges we've identified? What are you looking forward to? Where do you see hope for the future on how things are going to change?
Greg Schulze 13:46
As you said, Emma, it's definitely a connected ecosystem, isn't it, we learned that, and I think that's going to be a strength going forward. Because we all have to recognize what we do well, and really focus on that which we do best. And know that this connected ecosystem requires smart technology, it has to be data led, and that's what we're gonna see going forward. And that's going to result in a better experience for the traveler and a better result for the companies that are providing the travel. There's also some really interesting trends that came out in our survey. So we talked about the sentiment, when do you want to travel or do you want to travel? But we also talked about what it is that's important when you think about travel? There's definitely now an increased focus on sustainability. And we're quite excited about that. How do we help our customers travel with their values? And we saw in the UK for example, three in five travelers say they're willing to spend more to make their trip more sustainable. So how do we make sure that they have the right information that they need to make such a decision? We're also seeing travelers look for us to be a more inclusive industry. Two thirds of our travelers surveyed said that they're more likely to book with travel providers that identify their practices as inclusive. So our travel sites are really working hard to make sure that we're providing that information to our customers, and to help them make these important decisions that reflect the values. Because really, travel is so personal. And the pandemic has just caused us to be even more reflective and to think about what's more important. And so we as the travel industry need to make sure that we are investing towards that, and that we're delivering that experience for our travelers.
Emma Symington 15:38
So Decius from an Amadeus perspective, I know there was some recent research about some of these traveler sentiments and ones that they're looking at and I know that they've also looked at sustainability, and inclusivity is a really interesting angle as well to look at what from a nominee his perspective or your perspective, do you think are some of these topics that we need to keep in mind moving forward as we do really look to rebuild travel moving forward?
Decius Valmorbida 16:05
Sure. I think Greg mentioned a couple of things that we are very much believing for the future. First is this positioning, the travel industry has grown in silos. So essentially, everyone has been looking at their offer, and taking growth for granted. So it is like how I'm going to bring more passengers more room nights and travel was going to grow. So all of a sudden, because of COVID. And we can add sustainability in there, there is starting to have questions around what is going to be the growth pattern moving forward. So I mean, we are optimistic, we know travel is resilient, and will continue to grow. But that we have slowly a shift from the discussion around volume to value. So Greg mentioned here, what do we see at sustainability? Is it a challenge for the industry? Or is it an opportunity? So clearly, Greg has demonstrated how it can be an opportunity provided that we can offer the information, provided that we can explain to customers, what are the greener options, probably that will lead to even greater value for the industry, and value that can be split by all providers. So I think that is one shift. And I think the other shift that Expedia is very much as well, the pioneering example, is what we're talking about end-to-end the traveler services. So as I was explaining before the industry is organized around silos. And today, the experience of any consumer, whenever they're going to another industry is to have the industry looking at what is the customer flow, and saying we need to organize to make that customer have the best possible experience because competition that is not happening within the industry, but between industries now, so a customer can decide to buy a new mobile phone or take a trip. So the question is what is going to be the experience with the travel industry as a whole. So it's like having this mentality about building the one stop shop, integrating all of these silos, creating that customer experience, will require brands and travel companies to think very differently. We believe that Expedia is there as part of their vision, and they're delivering on it. And our side, we feel that that is a world that will require a lot of technology to orchestrate the traveler journey across all of the silos. And I think that's where Amadeus is investing. And we are very happy to have this partnership with Expedia. Because together, we feel that we're going to be able to make this vision a reality moving forward.
Emma Symington 18:48
So Greg and Decius, when we look towards this future. I mean, nobody has a crystal ball, right? Nobody can predict what's going to happen tomorrow, in a week or in a year's time of where the industry is going to be. But if you could say what one of your biggest takeaways is, from all of this research that has been commissioned from both companies, what you're seeing the conversations that you're having, what is it the big picture thinking that we can look forward to? You've mentioned, collaboration, sustainability, prevention, a more sustainable industry, whether that be environmentally but also socially? What's the one takeaway for you, that's the most important that you would love our listeners to hear? Greg, how about we start with you?
Greg Schulze 19:32
Well, as I said, the pandemic has definitely caused us all to be more reflective. And as we think about what's most important, a lot of us I'd say most of us have just seen what we've missed. All that we missed when we can't travel is pretty significant in our life, and we have to realize and have to think about how much better it is when we can celebrate together when we can go to that football match, Decius. When we do business in person rather than over Zoom. When we actually explore new places and connect with people around the world, friends and family, we all need to travel. And we've been missing that. And as I said, this is a choice of how customers spend their money. And over the last year and a half or more, we've been in our house, we've done a lot of home upgrades and ordered a lot of online stuff. And now it's time to get out and experience the world. And we need travel. So let's go.
Decius Valmorbida 20:38
No, it's great. I couldn't agree with Greg more, a very inspirational, so we're going to have all of our road warriors getting out there and exploring. And from a technology company point of view, we have an opportunity here to rebuild travel. So question is, why not rebuild it better than it was before. So we have to accelerate the trends that existed already, which is this focus on the end-to-end journey, the make ease and take friction, away from travel. So collaboration, use of biometrics, the digitalization of all providers, and really working as an industry in tandem, no? So just like we're building the product, providers are putting out the market, we're working with distributors, and everyone is aligned on this collaboration mindset to serve the needs of the traveler. So I think that that's the opportunity we have ahead of us, there is a lot of demand that is out there for us to be picking up, I think that everyone is ready. And they have been packing their bags just waiting for restrictions to be lifted, so they can see the world. So a new growth cycle was coming, and we're going to enjoy it. And let's make the investments and make sure that we can deliver on that promise. So yes, quite like ragged, quite optimistic about the future, I think we're going to have a tremendous opportunity.
Emma Symington 22:07
Great. And hopefully, next time you both meet, you'll be able to see each other in person and not through a video conferencing screen. So Greg and Decius. I mean, we've come to the end of the podcast, it was an absolute pleasure to hear from both of you about where you see the industry. It's certainly clear that Amadeus and Expedia, you see a bright future for travel, and the industry as a whole. And hopefully, as they say, you'll be able to see each other soon. And those business trips and all of the leisure trips are fulfilling. So whilst there are still so many challenges to overcome and navigate as we continue to recover, and navigate through COVID-19, there's also a number of opportunities that you've both laid out today, to really seize and rebuild the travel industry and rebuild it better as you say, Decius. So thanks to partnerships like these people like you coming together, we can definitely do it together and we'll all benefit especially travelers, business and leisure. So thank you again for your time, and I really look forward to speaking with you both again. And finally, thank you to all of our listeners for joining this conversation. You can stay up to date on the latest news from Amadeus. And to catch the next episodes in our series, you can check out the Insights section on the Amadeus website and follow us on Spotify or Apple podcasts.