Lee Hayhurst spoke to Accenture managing director and global travel industry sector lead Emily Weiss about the impact of COVID and her hopes for the future
Accenture travel industry sector lead Emily Weiss was upbeat when we caught up on a video call following her return from the recent Iata AGM in Boston.
Despite the ongoing challenges of COVID-19, there’s a growing sense in the sector that the worst is behind it as restrictions start to ease and international travel resumes.
Indeed, the very idea of having 600 aviation sector delegates under the same roof was testament to the fact that a degree of normality is returning after the toughest 18 months travel has ever faced.
Weiss does not downplay the scale of the challenge ahead, but says she is encouraged by how firms in travel have responded and believes a new era of innovation could be upon the sector.
She describes how the recovery phase should be faced with an attitude of “creative pragmatism” – an approach which seeks to combine the “realists’ vision” with the “innovator’s bold spirit”.
“Of course, budgets are going to be tight and travel companies aren’t going to have a tonne of money, but they will continue to be very thoughtful about their costs.
“They really need to be thinking about how they approach innovation, and how they build back smarter. The question for travel is how to avoid ending up back in the exact same place it was in before the pandemic.
“It’s really about being creative, looking at new ways to run a business. maybe it’s also about running your business smaller. In other words it’s about building back different, not bigger.
“Are you shaping your operating model to allow you to provide new offerings to your guests? Are you able to attract pent-up demand in a more automated way? Are you leveraging things like social media, which maybe you weren’t before before? Are you being more local?
“It’s really about being thoughtful and pragmatic, but in a new way – one that does not leave all that pent-up demand on the table for your competitors.”
Weiss says she has perceived a “major shift” in the way travel companies have approached innovation during the pandemic.
“Historically, pre-pandemic, I would say travel has not been that innovative. I think it’s struggled to capture the value of technology and to move forward.
“Compared to other industries, it’s not been able to flex that gene. But travel firms have responded incredibly well to this pandemic and recognised that they need to be decisive.
“They could have just said let’s furlough everyone, ground our planes, shut down our properties and just wait. They didn’t. They actually made decisions, came up with new products and offerings.
“I think they responded in a way that was quite creative and innovative. It would have been very easy to just sit on their hands. I would say it’s a real step change.
“Perhaps it shouldn’t have taken a pandemic to do that. But it did.”
As many sectors of global commerce are finding, the key challenges as the world emerges from COVID-19 are related to workforce and access to skills, particularly in digital and technology.
Weiss says this is where developing mutually beneficial partnerships will be vital, especially as the sector looks to accelerate its adoption of technologies like cloud and data analytics, which are essential to recovery.
The move to cloud promises to power a more agile travel sector capable of switching new technologies on and off, or dialling them up or down as required.
And as firms develop strategies for investing in their own tech skills or outsourcing to third-party suppliers, Weiss said they need to focus on what’s important to them.
“This is the perfect opportunity to leverage partnerships with companies to grow and to respond to guest needs.
“They can’t be everything to everyone. They also can’t be everything they want to be because there are still constraints, including labour, travel restrictions, quarantine, or entry requirements.
“The first step would be to look at the entire ecosystem and decide if you want to partner with tech firms to acquire digital skills or for a true end-to-end solution.
“For example, at Accenture, we initially focus on understanding what the client is trying to do. Are they looking for partners to help them scale or run their operations? Do they want to bring in new talent and ideas? What problems are they trying to solve?”
Now’s the Time to Test and Fail Fast
One of Weiss’s mantras is to test and fail fast and she says now is the perfect opportunity to try out new things.
“You need to be able to very quickly spin new ideas up and down. If you’re not enabled in the cloud, it’s a lot more difficult to do that. It’s the same when it comes to data.
“Without the cloud, you’re not going to be able to quickly go into a sandbox environment and put a new product or offering out, or try a new technology. Travel was one of the slowest industries to adopt cloud technology but now there’s an acknowledgement that we need to move.”
Weiss adds labour and workforce challenges are a big factor in deciding whether to develop technology in house or to outsource.
“There are so many other things firms need to be doing right now on their core competencies. So they need to differentiate between what they need to do versus what they want to do.”
Cloud and data expertise are “foundational elements” enabling firms to experiment with new forms of loyalty, digital marketing, booking flows or customer care and experiences, says Weiss.
“Right now, travel companies are sitting on a tonne of data but it’s too siloed and they are not able to gain insights from it,” she says.
“Historical data is still going to be useful. Maybe not in terms of current trends and benchmarks. But people are going to want to see what pre-2019 levels were and what the behaviours and trends were.
“It may not be as relevant today, but I don’t think it’s useless. We’ll just use it in a different way. Preferences may change, but, COVID or not, people will still like what they like.”
Weiss adds: “There’s a lot still to be determined in data privacy and sharing. None of that’s going away. But there is a need for better collaboration.
“The biggest struggle the travel industry is going to have is that trust and transparency needs to expand out of the industry to governmental organisations. At the moment, travel organisations don’t have control.
“There’s a need for firms to work more closely with governments and to get them to understand they are the front line. If people get turned away for not having the right documentation it’s the airlines problem but it’s not the airline’s fault.”
Surprise and Delight to Drive Loyalty
Weiss believes that driving consumer loyalty in leisure travel and exploring new revenue streams are going to require travel firms to find new ways to “surprise and delight” their customers.
And she said this must go beyond simply offering points or a discount and focus on the entire customer journey, offering a concierge type of experience from the point of shopping and booking to the in-trip experience.
“It’s about the end-to-end experience. That is what a leisure traveller, who may go away only once a year, is going to remember.
“For them, it’s not a money or a tangible points thing. It’s an experience they’re going to remember, and going to want to repeat, rather than something they just want to get a better price on next year.”
Returning to that sense of optimism she started with, Weiss says her outlook for corporate travel, predicted by many to be unlikely to ever recover, is improving daily.
She foresees demand potentially surpassing pre-pandemic levels as new travel behaviours that emerged during the crisis persist.
“My view keeps changing, but every day I’m getting more and more confident about the return of business travel. I’m in no position to predict confidently and the biggest issues are factors we have no control over.
“But I do have a high degree of confidence right now that business travel will return in a greater way than anyone thought. Will it be the same? I don’t think so.
“Actually, I will say it even more strongly. It will not be the same. Does that mean it will be less? That remains to be seen. The reason I say that is there are multiple, entirely new segments of business travel that did not exist before.
“There’s a lot who won’t travel. No one’s likely to fly across the country, or across the pond, for a one-hour meeting anymore. Technology has proven that you don’t need to do that.
“But there are people who now don’t need to be in the office every single day. So they’re not living near their offices anymore. But it’s not like they’re never going to be in the office again.
“So these people who never used to set foot on a flight or in a hotel because they lived a few blocks from work will now need to travel. That’s hotel occupancy. That’s potential flights.
“Another new segment is people who travelled so regularly they stayed in corporate apartments. Maybe now they’re not going to have those apartments and are going to stay in hotels.”
As corporate travel returns, leisure travel and pent-up demand from people hungry to make up for missed experiences, luxury trips and seeing friends and family will “take up the slack”, says Weiss.
“The question is, is that sustainable? Yes, for a while. It’s a matter of whether the balance of leisure and corporate travel is going to flip slightly.
“Will it be the new business traveller or the new leisure traveller? The ‘workation’ or ‘workspitality’? The ‘Digital Nomad’? These things didn’t exist before. But they’re here to stay.”