After an intense three days of “Through The Looking Glass”, my mind is still sparking neurons even though I am now safely esconsced on a private island in Bintan, Indonesia.
Cempedak has, for the last two years, become my go-to escape after WiT Singapore 2018. I saw the all-bamboo resort while it was being built, stayed on it when six villas were ready and today, all 20 villas are completed and you could say the private island, owned and operated by the same folks behind Nikoi, has come into its own.
Its spa has opened. I’ve just had a two-hour massage in a spa villa fronting the ocean. To the sound of lapping waves, and a gentle light breeze, I surrender my physical self to the strong, firm hands of the therapist – my mind though refuses to still.
It’s hard to unplug after what was, to me, a most diverse and intense examination of our travel industry through the lens of so many perspectives and characters.
From the former pyschiatrist Dr Kris Naudts, who started Culture Trip “to end all suffering” and how he turned “a cool idea but a bad business” into a “good business model” to body builder Kortney Olson, who started sports retail brand GRRRL out of a social movement to end the suffering of women over their self-image …
From the Philippines set to emerge as the next big market in South-east Asia as a young, social, mobile population gets ready to discover farflung places, inspired and facilitated by fledgling startups to Israel, whose tech companies and resource of tech talent see travel as a natural lucrative vertical for their services …
From mega travel brands looking to Asia for product innovation and the next consumer wave to newly-minted startups who hope that if you can’t beat them at scale, you can with speed …
From tech giants jostling to be the channel of choice in Asia – be it social, video, chat or voice – for the next billion consumers to the rise of the superapps from payments and transportation companies as they extend into travel and lifestyle offerings …
Those are some of the forces underlying the tectonic shifts we’re seeing in travel in Asia today.
Here are some of the key takeaways I gleaned from WiT Singapore 2018
1. AI comes into its own
Lynette Pang of Singapore Tourism Board presenting “Imagining New Possibilities”. (Image credit: Shoot My Travel)
AI is the new electricity sparking predicting, recommending, personalising even influencing with CGI influencers like Lil Miguela with her 1.1m fans.
Imagine influencers you can control, said Lynette Pang, assistant chief executive (marketing), Singapore Tourism Board, during her presentation on “Imagining New Possibilities”.
Hotels.com toyed with the idea of a CGI pug, to follow on from its November 2017 branding campaign of having a pug as its mascot for the region but found it too hard to execute, said Nelson Allen, general manager, Asia.
William Bao Bean, managing director, SOSV, said AI was the only thing SoftBank’s $100b Vision Fund was interested in – “AI in everything”. Ditto with companies like Google and Facebook where AI, machine learning and natural language processing are driving everything they do.
This is an area travel tech companies have to change thinking on as they strive to compete with tech giants – data and AI at the centre of everything.
2. It takes two to tango – China & ASEAN, global & local
Global might and local power – Expedia’s Greg Schulze (centre) and Traveloka’s Henry Hendrawan with WiT Yeoh Siew Hoon (Image credit: Shoot My Travel)
Hian Goh, founder and CEO of Open Space Ventures, said that while Chinese Internet companies like Alibaba and Tencent were aggressively expanding into South-east Asia, they’d form joint ventures to drive their growth rather than do it themselves.
This approach has also been taken by Expedia Group which used AirAsia as the partner to drive growth in its first 10 years in the region and is now invested in Traveloka for the next wave.
Both companies are tapping into complementary strengths – Traveloka into Expedia’s global scale and Expedia into Traveloka’s local power.
Greg Schulze, senior vice president, commercial strategy and services, said he was impressed by Traveloka’s pace in product development and speed to market while Henry Hendrawan, group CFO of Traveloka, said the way Expedia can switch on scale is impressive.
Traveloka’s layering of other services on top of travel – spas, restaurants and payments – is to be watched. It was its ability to crack payments at a local level and across borders that pundits said contributed to the Indonesian company’s success.
3. End of capital flow and flight to quality
Investors William Bao-Bean, SOSV & Chinaaccelerator (right) and Hian Goh, Open Space Ventures, looking for their next big pot of gold, (Image credit: Shoot My Travel)
The softening Chinese economy will also mean “the end of capital flow”, said Rob Rosenstein, chairman and founder of Agoda, predicting leaner times ahead for startups.
Investors Bao Bean and Goh both said there would be a flight of capital to quality, which would be a positive thing for the as sanity returns to the market and stronger proven business models prevail.
Goh, an early investor in GoJek, explaining the Internet hierarchy of needs, predicted capital flow towards services at the top of the pyramid – edtech and health tech. Monetary – fintech and e-wallets – are being addressed currently, while Transactions (transport and ecommerce) and Communications (social, messaging and emails) are pretty crowded.
4. Traditional travel brands step up pace in embracing innovation
Singapore Airlines’ Campbell Wilson revealing initiatives the airline is rolling out. (Image credit: Shoot My Travel)
It takes some doing, to move a more-than-70-year-old company into the digital age but Singapore Airlines is determined to do it.
Campbell Wilson, senior vice president, sales and marketing, reeled off a list of initiatives the airline is rolling out – from KrisPay (its blockchain-based loyalty programme) to its innovation lab. The former CEO of Scoot spoke of how the lessons he learnt from running a low-cost airline translate themselves into his current role – that of speed to market and working with startups.
While with Scoot, he was the driving force behind the Value Alliance and its adoption of Air Black Box technology and he’s also championing startups like Traversel which wants to plug destination content into airline distribution.
While SIA sees digital’s primary outcome as customer service, it also sees opportunities in building revenues and profits and building loyalty.
That SIA is doing so much behind-the-scenes came as a surprise to a lot of people – Wilson taking to the stage to share its initiatives is a sign that traditional travel brands are not to be dismissed in this next wave of digital travel.
5. Experiences, the next pot of gold, and a post-search world
Klook’s Eric Gnock Fah (left) has a US$200m war chest, with Rod Cuthbert, founder of Viator.
Tours and activities, set to be worth US$183b by 2020, of which only 10pc is booked online, are coming online in a big way, aided and abetted by the convergence of consumer demand for on-demand services, travel giants stepping up the ante and well-funded startups fighting for share of market.
In just a year, Airbnb has gone from a global inventory of about 3,000 to 16,000 experiences, operating in about 1,000 markets, as compared to just 40 a year ago. In Asia, it has expanded from 13 markets to 200 now.
Klook, with its new US$200m war chest, will expand its team from three, in 2015, to 800 in 18 locations as it scales globally.
And the fearlessness of these new startups is to be admired. When Eric Gnock Fah, co-founder and COO of Klook was asked by Rod Cuthbert, founder of Viator, the pioneer in the space, if he was worried about Google dominance in search and its launch of Touring Bird, the Mauritius-born boy was sanguine, saying, he saw it as an evolution of search and that we were entering a post-search world, with social and other channels emerging.
The preoccupation with Google, to me, stems from Western thinking because of its dominance in the US and Europe but in Asia, channels are more fragmented with strong local players offering alternatives and perhaps entrepreneurs in Asia are more pragmatic, and are used to dealing with global giants in their midst.
6. Messaging Takes On More Might and Bite
Meghan Joseph of Facebook (right) and Kei Shibata of LINE Travel jp revealing the might of messaging to WiT’s Yeoh Siew Hoon.
Take messaging for example. While Facebook and Whatsapp dominate in Western markets, in Asia, local chat apps are strong and they are full ecommerce ecosystems.
According to Facebook, there are 10b messages a month exchanged between businesses and customers on Messenge. On WhatsApp, there are 1.5 billion people active each month, on Messenger 1.3 billion and on Instagram 1 billion.
And more than 61% of people say they prefer to message companies – so expect disruptions to leverage a chat first approach to gain market share, said Meghan Joseph, head of travel, Asia Pacific, Facebook.
Kei Shibata, CEO, LINE Travel jp, the new brand that’s emerged from the partnership between LINE and travel jp, is unfazed by the global giant’s power. LINE has 200m monthly active users and 77% use it everyday, he said, and its penetration is strong in markets like Indonsia, Thailand and Taiwan other than Japan.
The new merged entity plugs travel services and content (including restaurants and activities) into a blended distribution reach of 200m monthly users on web and 17 monthly users on LINE.
“It’s an incredibly powerful combination of travel knowledge and content with distribution power,” said Shibata.
7. Watch the rise of superapps – from Grab to Alipay
Cherry Huang of Alipay (left) talking about the “Lifestyle Super App”.
One question thrown out there is whether the industry will see the rise of superapps such as GoJek in Indonesia, Meituan in China or Grab in Singapore or Alipay as it follows Chinese travellers around the world “when you can do food, transport, shopping, travel and more in the one place”, asked Timothy Hughes, vice president, corporate development, Agoda.
“Or are we just seeing a new version of the portal craze of the late nineties early noughties (think Yahoo, MSN, AOL) where the accumulation of services in one place falls apart soon after consumers become comfortable with the tech?”
Monty Doshi, director, architecture, Travelport, noted, “There will certainly be a consolidation of apps and an evolution of the traditional app as we now see it today. Consumers have specific platforms they use today for various things eg Google signifies Search, Whatsapp or WeChat signifies instant messaging, Instagram, Facebook signifies social networks.
“So there could be some consolidation of specific travel functions with the platform that customers prefer to use. So instead of asking the customer to download a new app the approach would be to turn the app/service on within the existing platform that consumer uses. We are already seeing that today.”
Alipay calls itself a “Lifestyle Super App” with 700m users daily and offers, on top of financial services, social platforms, merchant resources and life services.
In South-east Asia, its top markets are Thailand, Malaysia and Singapore and it is seeing a growing trend of Chinese travellers going to more “inland” places within destinations as Alipay gets more accepted by merchants across the region.
It has launched an Alipay Mini Program, to offer hotels an “app in app” product to supplement hotel concierge services, offering restaurants, spas and tours and activities (integrated with Fliggy, its sister company). Through Alipay Discover, hotels can “meet, interact and transact with customers pre-trip and during trip”, said Cherry Huang, general manager, cross-border buiness, Alipay.
8. Blockchain could be the next leapfrog technology for emerging markets in Asia
No tech confeence today can escape from having a session on Blockchain.
Just as mobile caused a leapfrogging in emerging markets in Asia, blockchain could trigger the next wave.
While there was consensus that there was still a lot of hype around blockchain, there was also agreement that emerging markets in Asia would be the perfect test bed for use cases.
Startups from Owlting Group of Taiwan which has raised US$10m to WEGOGO, a tours and activities play out of Singapore focused on China and Atlas, looking to building the next-gen Booking.com and TripAdvisor and looking to raise VC funding of up to US$20m, are taking a crack at it.
Zan Wu, founder and CEO of Atlas, said, “In a way, I am glad the market around crypto has crashed because now there’s opportunity for real players to come through and build something real. Travel is the most monopolistic industry with the major OTAs and there needs to be a redistribution of power.”
Wong Toon King, CEO of FarSight Capital and chairman of WEGOGO, predicted, Blockchain will be the next platform paradigm shift. It will become primetime by 2023 in underserved markets, fringe and fragmented – and in payments, travel and computing.”
Other predictions:
- Voice to text will be huge in India – Deep Kalra, chairman and group CEO, MakeMyTrip
- We will fly in battery-powered drones for leisure travel by 2030 – Bobby Healy, CTO, CarTrawler
- Ten seconds is the new norm for video content – but you have to catch their attention in 3 seconds.
- Virtual reality will finally take off with the new Occulus headset which will give a real, immersive experience – Nikhilesh Ponde, head of global travel strategy, Facebook
Finally, here are a couple of predictions inspired by the island of Cempedak, post-WiT.
Cempedak: The bamboo island
• Travellers will always need local, authentic, immersive experiences that allow them to unplug, recharge, rewire – whatever you call it. So more power to entrepreneurs who build magical places for us to escape to.
• There is a new world order emerging of a divide between the consolidated, connected groups and the independents, empowered by the widening circle of the web and the promise of new tech.
• We need to remind ourselves occasionally that travel is an enjoyable experience, not a process, and for that we need to look beyond our industry walls, “Through The Looking Glass” at our customers.
In the destination marketing panel, “Crazy Rich Asian” actress Tan Kheng Hua said she enjoyed the planning process with all its imperfections. Her last holiday was a place where she was totally cut off from WiFi and her mobile.
Perhaps in this crazy tech world we live in, that’s exactly what we need. So for 2019, let’s all make a pact to do one unwired retreat each. Game?