War chests have been replenished, battle moves have been made, welcome to travel’s own GOT (Game of Online Travel) Season 2019
If you are a Game of Thrones fan, you will know the first two episodes have largely been helping us to catch up on the story, and none of the main characters has died yet. “I can’t wait for the killing to begin,” said a particularly blood-thirsty friend of mine.
South-east Asia’s super app in the making
Well, it’s also about to get very bloody in the world of online travel in Asia. Think of the war chests that have been raised by those jostling for supremacy, and you can imagine the battle scenes ahead.
This week, Grab, which raised $3b in new funds last year, made further moves into travel – launching hotels through partnerships with Agoda and Booking.com. With Booking Holdings’ $200m investment into the South-east Asian company vying to become the region’s dominant super app, that partnership comes as no surprise.
You’ve got to wonder if flights and tours and activities, sure to be next, will end up in the same Booking Holdings family – is it a foregone conclusion that it will be KAYAK for flights or could other metas have a look-in?
Tours and activities is a natural – among the four new services it launched this week is trip planning, which helps both residents and travellers navigate public transportation, so guess what’s next? Will other B2B partners have a chance or again, will it stay in the family?
It will be interesting to see how much cannibalisation or incremental business will happen as a result of Agoda and Booking.com ‘s partnership with Grab but I suspect that’s not even a consideration at the moment – what is happening is a massive land grab by giants wanting access to each other’s customers, and well, it’s all sort of ending up in the same pockets anyway.
The Agoda feature is live and Booking.com will go live later this year. You click on the Hotels tile and it takes you to a separate Agoda file and then you have to navigate through the Agoda platform.
As a customer, I am not sure why I’d use Grab to book on Agoda when I can book on Agoda directly. When I asked if by booking on Agoda through Grab, I’d be entitled to rewards on both platforms, an executive demonstrating the app told me, yes, there’d be double dipping.
As I see it, in the end, it’s all about GrabPay – when that function is integrated into the Hotels tile, then maybe it will make sense if I can complete the purchase with my GrabPay account. For Grab, it means, bigger wallets will have to be stored on GrabPay. Right now, I struggle to even use up my $100 on GrabPay because I am using Go-Jek more and more as a local commuter, and I hardly use GrabFood when I have other choices like Food Panda and Deliveroo.
Last week too, I moderated a panel at the Singapore Tourism Board’s Tourism Industry Conference, featuring Expedia Group, Alibaba Group and Google. So again, here are three giants jostling for supremacy.
We’re long past the debate of whether Google is foe or friend. It is both. It is the biggest customer acquisition channel for the giants – Booking Holdings and Expedia – and it is a formidable competitor at every stage of the customer journey. At WiT Middle East, Sameer Bagul of Cleartrip said “the days of free traffic are over” and everyone’s got to find new ways of acquiring customers.
Even with local restaurants, I find Google is top of mind. if you just type the restaurant in your Google search, it will take you directly to the restaurant or one of the many reservation apps (Chope, eatigo, Quandoo, OpenTable). Each has responded by offering discounts for you to book at particular times or vouchers that effectively gives you discounts for your meals. I feel for the restaurants, truly I do. They already operate on such small margins, imagine what this disintermediation is doing to their businesses.
Google is in hotels, flights, tours and activities, restaurants, every stage of travel and as a consumer, I find it very hard to avoid in my life – and it has seven brands, each of which has more than a billion customers.
Moving onto Alibaba Group, which is on an aggressive globalisation strategy. Angel Zhao, leading the mission, reiterated the group’s purpose to spread fun through travel, by integrating Fliggy and Alipay. In 2018, the group had 642m consumers, by 2036, it plans to have two billion consumers.
Expedia Group, while a giant in travel, is a minnow in comparison with Google and Alibaba, said Greg Schulze, senior vice president, humbly on the STB stage. Expedia’s revenues in 2018 totalled US$11.2b revenue, compared with Google’s $136.8b and Alibaba’s 250.3b yuan ($39.9b).
Expedia has aligned forces with Indonesia’s unicorn OTA, Traveloka, which is said to have raised another $420m this week, and it is on the march. In Indonesia, it’s expanded into tours and activities as well as restaurants and is taking that multi-sector platform outside its home market.
(Image credit: Klook Facebook page)
Then let’s not forget Klook, the newest comer to the online travel battleground, which this month announced a raise of $225 million round, led by the Vision Fund with participation from existing investors. The deal — which is described as a “Series D plus” — comes just eight months after Klook announced its $200 million Series D at a valuation of over $1 billion.
And oh yes, let’s not forget Go-Jek, which is also making a land grab to become a dominant superapp.
Every one of these companies, when asked why they are doing what they are doing, will tell you it’s about giving their customers convenience. We want them to book where they want, when they want and how they want. But of course, it’s also about the investors’ convenience – when you have put so much money into something, it’d be terribly inconvenient if they have to keep chasing unprofitable growth. But then again, like Game of Thrones, often what we think should happen does not.
Welcome to travel’s own GOT (Game of Online Travel), Season 2019.
• Featured image is of Daenerys Targaryen (Emilia Clarke) and Jon Snow/Aegon Targaryen (Kit Harington) in a scene from Game of Thrones season 8. Credit: HBO