TUI to gain competitive advantage with new tour booking platform
TUI customers will soon be able to book multi-day tours (ability to book multi-day tours, including activities and overnight stays) through an integrated online platform, giving them the ability to customize their vacation. The new development is in partnership with travel technology provider – Nezasa AG. As the market for multi-day tours is currently very fragmented, this development is an opportunity for TUI to increase its competitiveness vis-à-vis a younger population who traditionally book independently or through more tailor-made holiday providers. .
Personalization will attract millennials
A lack of personalization and experience in the destination has prompted millennials to seek alternative vacation providers, rather than traditional tour operators. According to the GlobalData Consumer Survey for the first quarter of 2021, 27% of 18-34 year olds said personalization “always influenced” their product choice, which was the highest proportion of any other age group. age of the survey, which suggests a high demand for a personalized product. vacation experience. As the new platform will offer a greater choice of content, it creates the possibility for millennials to personalize their vacations, creating a unique selling point for TUI.
Additionally, millennial travelers are likely to seek out experiences while on vacation. However, generally package vacations only offer a limited number of excursions (sometimes none) during the booking process. As a result, package travel is popular with millennials, with 30% choosing to book this type of travel, according to a 2019 GlobalData Tourism Consumer Survey Q3. Nonetheless, direct bookings present a particular set of challenges. The reduced levels of flexibility, regulation and consumer protection mean that the booking method carries risks. Intermediaries such as TUI can help alleviate some of these potential problems by offering tours and excursions from reputable wholesalers or operators, while providing consumer protection in accordance with package holiday regulations. An element of pre-planning is also an interesting possibility, with the customer knowing the exact cost of their vacation before they travel, which is likely to increase demand due to the long-term economic pressure of the pandemic.
Fragmented market for multi-day tours offers an opportunity
A lack of technological development and b2b (business to business) relationships has resulted in a fragmented multi-day channel sub-industry with no apparent middleman taking hold of this sector of the market. Although intermediaries often take part of the profits of tour operators, they can help stimulate regulation, raise standards and provide customers with adequate financial protection.
Ultimately, TUI provides customers with a mark of confidence and the assurance that tours and experiences will consist of a certain standard. The technological development demonstrated by TUI in partnership with Nezasa AG could also be a game-changer in the industry, allowing multiple tours to be booked with the potential to incorporate dynamic pricing and booking incentives later.
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