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The State of Online Asia-Pacific Travel Services

Thursday, June 2nd, 2011
travel agent

The incredibly fast growing popularity of online and mobile channels in the Asia-Pacific has paved the way for tremendous growth in several vertical industries such as the travel and tourism industry. Strengthened by a growing Asian middle class, the emergence of multilingual travel websites and mobile portals, as well as increased security for online payments make online travel services a very important sales and marketing channel for the industry.

Major airlines in the Asia-Pacific region are beefing up their e-Commerce platforms and are investing in better and more innovative online channels such as bookings, e-ticketing, check-in, and other services that will deliver an even better customer experience. Online travel agencies such as Travelocity and Expedia, both of which have experienced significant success in the European and United States markets, are now focusing their sights on the Asia-Pacific by putting online travel efforts in this region at the top of their priority list.

Online Travel Services in the Asia-Pacific

The Asia-Pacific is a region where the online world is sitting at two different development levels. At one end of the spectrum sit countries like Japan, Singapore and South Korea, as well as the Australian continent, where e-commerce and online travel are more mature due to their advanced digital infrastructures. On the other end of the spectrum sit countries with less developed online capabilities and infrastructures but which are steadily showing growth in this area.

Overall, the region showed a 7 percent increase of total Internet audiences from 477 million in 2009 to 511 million in 2010. From this figure, 129 million visited online travel sites in 2010, registering a 19 percent increase from the previous year. Most of the traffic was generated by online travel agents, registering 52 million visitors for a 30 percent increase from 40 million the previous year.

At the middle of this online spectrum lie China and India, whose very dynamic digital economies are now driving the region’s overall growth and will be opening up new and massive opportunities for the travel and tourism market. In 2006, Chinese online travel bookings registered a net worth of US$1.5 billion and this number has been steadily increasing each year by 60 percent, now expected to reach figures close to US$15.4 billion by the end of 2011.

This is attributed mostly to China’s tremendous economic growth. Coupled with a meteoric rise in China’s Internet user population and the government’s easing of overseas travel restrictions, it is expected that sales and revenues for the Chinese travel and tourism sector will continue to grow more expansively.

India likewise is showing the same trends, with an average annual growth rate of 46 percent since 2007, and which is expected to reach revenues of up to US$4 billion by the end of 2011. This growth is attributed to India’s growing middle class, who now have the resources and facilities to purchase railway or budget airline tickets via the Internet. In response to this trend, new and upcoming Online Travel Agencies are emerging to cater to the travel demands of these consumers.

Airlines have also been cashing in on The following provides a brief rundown of recent trends and developments from the top movers and shakers in the Asia-Pacific Online Travel Service industries.

Malaysia Airlines has launched their latest re-designed websites and since then there have been a tremendous increase in online self-service transactions through these portals, which the company expects to generate up to a 70 percent growth in revenues. These new websites feature a virtual customer assistant that makes the visitor’s online experience a lot simpler and more convenient. The websites’ features allow consumers to plan their travel more conveniently aside from giving visitors destination guides, travel ideas, and other service offerings such as car rentals and hotel bookings.

Aside from their revamped websites, Malaysia Airlines also launched their innovative Facebook page that has the facilities to handle online bookings and check-ins from within the social networking portal itself. The page features the MHBuddy which allows users to search for available flights within the airline’s network as well as obtain data for times, prices, inbound and outbound options. But what makes Malaysia Airlines’ portal unique from other systems in the Facebook world is the feature that will allow users to view which of their Facebook friends are booked on the same flights and destinations – allowing them to connect with their friends and exchange information about their trip plans.

Focusing on the Asia-Pacific region, Expedia recently announced its new Singapore website that specifically meets the needs of Singaporean travelers, including air fare packages and hotel bookings. Aside from the Singaporean site, Expedia also maintains a web presence in Australia, New Zealand, Japan, and India and is upgrading its presence in China.

Hotels.com is beefing up its online hotel booking presence in the AsiaPacific by teaming up with Giosis Gmarket, a popular e-Marketplace in the region. This will expand the site’s ecommerce offerings and provide Asia-Pacific customers an online window to book at any of the more than 130,000 hotels worldwide. Giosis Gmarket is enjoying an average of 300,000 visitors every day, many of which avail of their online shopping services for beauty, electronics, fashion and sports products – and now can enjoy getting the inside scoop of the world’s best hotel deals.

Independent hotels in the Asia-Pacific region now have an efficient but costeffective facility to drive bookings directly to their own websites or booking engines by working with Worldhotels’ Resmaster booking engine system. Through this system, Asia-Pacific independent hotels can display their real time rates and availability directly next to major advertisers appearing in Google Maps or Google Places search results.

Jetstar Airways, a subsidiary of Qantas and Australia’s low-cost airline, is finalizing an iPad-rental deal with Appeal that they can offer to their passengers at only AUUS$10 per flight. The iPad’s will be available in the Jetstar’s A320s plying the Australia and Asia-Pacific routes, providing passengers with their own personal in-flight entertainment system from where they can choose their own books, games, music, movies and magazines while in flight. Several similar stories and updates abound among online travel services in the Asia-Pacific region, and would continue to increase within 2011 and on in the coming years ahead. These are just clear indications of how dynamic travel and tourism is in the region that will be opening new doors for a wider and more global market penetration.

Future Trends in APAC Online Travel Services

62 percent of Asia-Pacific travel agencies are optimistic for the upcoming trends and outlook in the region’s travel and tourism industry, as economies rebound from the global recession and with new travel landscapes and destinations travelers can look forward to. The first quarter of 2011 is already showing signs of optimistic trends as it already registered a 15 percent growth for travel in the region, brought about by a phenomenal growth in the online and mobile travel services.

The Asia-Pacific region registers over 450 million mobile Internet subscribers, 127 million of which comes from India and another 155 million from China. Juniper Research reported potential revenue of US$630 billion for the mobile payment market by the year 2014, providing a great opportunity for online AsiaPacific travel services to leverage marketing through these channels.

The report also indicated that 85 percent of travelers in the region take their mobile phones and devices with them and would most likely prefer mobile bookings and payments for all their travel needs: from hotel bookings, car rental, insurance, to food and beverages and other needs. Fraud fighting operations are also being intensified in the region that will eventually increase consumer trust in these online and mobile channels. In a recent report from Abacus, 55 percent of travel consumers in the Asia-Pacific region prefer to choose online travel services that offer multiple payment options that will allow them to select the method they prefer and are most convenient with. The report also suggested that 54 percent of these consumers allot great importance in keeping their financial information as securely as possible and would prefer channels that offer such security. Online travel services can leverage this information and align their own websites and online portals to make services most convenient for their visitors – and eventually make the sale.

Online travel services in the Asia-Pacific region need to develop their websites and online channels and have increased security, more convenient booking channels, better payment options and everything else that would make customer experience as exciting and appealing as possible. Such improvements can open the door for international expansion by increasing their chances of reaching out to a more global audience and increase market penetration.

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