Experts debate exclusive research on travel technology spend by Travolution at this year’s Travel Technolgy Europe show in London. Ben Ireland reports
Company culture will drive technological innovation but travel firms must continue to increase investment if they are to stand out or keep up with change.
That was the message from industry experts at a debate hosted by Travel Weekly sister title Travolution at the Travel Technology Europe show in London last week.
They discussed the findings of the Travolution Innovation Report 2018, which revealed that £1.59 billion was spent on IT in travel in 2017, up 5% on 2016.
Spend on IT per employee was highest among travel agents, at an average of £8,765, ahead of tour operators at £7,636.
Hotels, which typically employ more people, spent £835 per staff member, bringing down the industry average to £4,671.
Colin Brimson, chief executive of communications technology provider d-flo, said: “The key thing for travel brands is to differentiate from the pack.
“Historically, we’ve seen a lot of success in the tour operator space, but now we’re seeing travel agents starting to see they have to stand out and do things more efficiently.”
He said tried-and-tested technologies such as SMS are being used now in “different ways” to enable customers to interact with agencies in the most consumer‑friendly way.
Andrew Auden, product director at payments technology specialist Ixaris, said developments in the travel retailing and tour operating sectors would drive innovation in payment technology.
“There’s this perfect storm of disruption that’s developed over the last few years,” he said, referring to challenges such as the rise of blockchain and regulations like PSD2 that outlawed card surcharging.
Carl Morgan, managing director of travel technology provider Tigerbay, said: “Quite often, culture is the driver in terms of how quickly something will be taken up, and how successfully.”
Morgan compared the potential for change in payments technology to online banking, which he said consumers were sceptical of 10 years ago.
Voice-enabled devices, he said, were also on the journey to adoption, with reduced prices making it more accessible to consumers.
“One minute consumers are opposed to it, the next minute they’re ordering shopping or booking a holiday,” he added.
Auden said travel firms must keep up with the pace of innovation but warned it may be sensible to wait to see which technologies prove popular.
“We see a demand for innovative features,” he said.
“Staying at the edge of that curve is a consistent battle.
“Sometimes it’s the non-technical people at a business who analyse what it gets out of the function and what works.”
Morgan agreed, adding that innovation among technology providers is driven by clients’ demands. “Your next customer defines what your product needs to be,” he said.
“A technology company can’t stand still and sell the same product. For them, ‘business as usual’ means innovating for the new customer.”
But he said innovation can be “stifled” within businesses, which can require increased IT budgets just to sustain their ‘business as usual’ ethos rather than to fund developments.
“Your marketing department might want to embrace AI but, in reality, there are other priorities,” he added.
“Things might need replacing, and it all costs money. When you’ve got demands to run the business as usual, as robustly and efficiently as possible, innovation takes a back seat.”