Monthly Archives: January 2014

Davos 2014 calls for corporate responsibility

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Davos 2014 calls for Corporate Sustainability and Responsibility: #CSR brings benefits to both business and society! #SharedValue

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Google’s Advantage in Native Advertising

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There are many internet users who may be wary of their privacy settings and on the information they share online. One of the reasons is that it is very likely that ICT giants like Google and Facebook may know their users very well. Google, in particular might know where its users are, the places they go to, the location of their home address and where’s their place of work, who are its users’ closest friends, the things they like, the websites they browse and in many cases, even the content of their emails.

Provided that individuals don’t mind giving up a chunk of personal data, their life can be made a bit easier by the web’s services. The internet’s mantra is to make information more useful, accessible and readily available to everyone. Nowadays, we use our tablets or smart phones and visit dozens of websites to learn about products and services. Savvy consumers like to compare prices whether they are buying items online or in retail stores. The latest technological developments and additional sources of information are influencing consumer behaviour as it appears that they are becoming more frugal in their purchase decisions. Consumers are seeking better value and good deals in return for their money.

Google is increasingly exposing its search functionality to its users. Last year, it tested a ‘Knowledge Graph’ pop-up which featured a carousel of images along with certain search results on hotel accommodation. As with restaurants and bars, review scores and recommendations are usually generated by consumers themselves rather than through conventional search engine optimisation tricks. It seems that Google’s drive is to personalise the search experience through ‘meta-search’ tools which aim to recognise what exactly users are looking for. In this day and age, it is very important to understand the broader context of consumers’ search queries. For instance, internet users may start searching for flights. Afterwards they might browse for hotels, then restaurants as well as cultural activities. Evidently, Google is responding to such queries by bringing up pictures of neighbourhoods, reviews as and also Trip Advisor content.

Recently, Google has been looking for the meaning beyond its users’ search content. Before September 2013, Google’s searches were focused on site content which improved its results by penalising low-quality material. However, the search engine’s latest algorithm, Google Hummingbird is focusing more on the search query itself. Hummingbird has implemented something called “conversational search” in order to better understand what users want when they either type or speak a search query into Google’s search engine. For example; the query, “Where can I buy a smart phone, near me?” Pre-Hummingbird Google would have prioritised search results that match individual words – like “buy” and “smart phone.” With Hummingbird, Google can better understand what users want from their query. Most probably, Google may know your exact location and hopefully it can find smart phones near you. It may be in a better position to determine whether you want a brick-and-mortar store rather than an online retailer. In a nutshell, Hummingbird is focusing on the meaning of the entire search query rather than simply searching for key terms. Hummingbird allows Google to provide its users with more accurate results and better site rankings.

Notwithstanding, Google often utilises its users’ data to re-target advertising to them. Google collates its users’ profiles with their data. Personal information is being used by Google for business purposes. Google Adwordsdisplays the marketers’ messages in front of potential customers; right when they’re using its search engine, watching a video on YouTube or when they are receiving their email through Gmail. As a result, online marketing ads appear on google users’ screens. These ads capture the users’ attention by providing certain content which may possibly appeal to them as potential customers. Such online advertising is called ‘native advertising’. Professional marketers are capable of producing relevant content which can entice customers’ to purchase their products or services. The right content is personalised in both its form and function according to individual customers’ needs and wants. This way, paid advertising may feel less intrusive and there’s a better chance that internet users will click on these web ads. The most popular formats for native advertising usually feature promoted articles, images, videos, music as well as other media.

In the past few years tech giants, particularly Google strived in their endeavours to gather valuable information about their users’ interests, the things they look for, their friends, the places they like and what have you! Google maintains that it can better serve its users if they voluntarily disclose their data on the web.

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A Recent Portrait of Asian Travellers

Travelzoo Asia Pacific has released its annual subscriber survey findings that show that this year they are forecasting an increase of 17 percent in travel budgets over 2013. The results also indicate certain changes in vacation spending patterns of the Chinese travellers. It transpires that the majority of them are willing to spend more to upgrade their holiday experiences as they are opting for high-end accommodations.

shaThe Pearl landmark in Shanghai.

This survey mapped changes in consumer behavioural attitudes and it also provides a benchmark for the travel industry across the Asia Pacific region. A study was conducted among 3,400 Travelzoo subscribers between November 24 to December 15, 2013. The informants hailed from Australia, China, Hong Kong, Japan and Taiwan.

This quantitative study suggested that the Chinese travellers will continue to lead the region with regards to travel frequency. On average the mainland Chinese subscribers are expected to travel about 6.5 leisure trips and will spend around USD $8,200 each during 2014. These figures are followed by the Japanese segment, with 5 leisure trips and an average expenditure of USD $4,800. The Taiwanese with 4.4 leisure trips and an average expenditure of USD $6,170; and Hong Kong travellers with 4.3 leisure trips and an average spend of USD$6,900. Curiously, Australians will travel the least, with an average of 3.5 leisure trips in 2014. However, this study suggests that they will fork out the most. The Ozzies will be spending over USD $9,340 for their vacations this year.

When respondents were asked to describe their attitude towards leisure travel, 62 percent of the informants indicated that they would prefer to explore the destinations at their own pace. Fifty four percent declared that they want to rest and relax during their vacations. Almost half of the informants would like to improve on the quality of their vacation package. The informants revealed that they will spend more on hotels, food and entertainment, and less on shopping. The Chinese subscribers are willing to spend an average of USD $169 per night. This finding is in line with their willingness to spend even more for a better holiday experience.

Group Tours: Interestingly, the Group tours’ appeal continued to decline among all subscribers, with a regional average of 30 percent who will choose to travel in groups. Evidently, the Chinese like to personalise their own travel experiences as only 14 percent go for group tours, and 58 percent purchase accommodation and transportation individually.

All-Inclusive Holidays: Over 51 percent prefer all-inclusive holiday packages and purchasing accommodation and transportation only. Fifty four percent of the Chinese subscribers prefer all-inclusive holiday packages

Mobile Internet: Over 80 percent of Travelzoo Asia Pacific subscribers will be using mobile internet during their holidays. An overwhelming 98 percent of the Chinese subscribers maintained that they will do so, followed by 93 percent Hong Kong subscribers. Eighty four percent of Asian travellers held that the first thing they would do when they reach a café / restaurant or a hotel is to check for the availability of free Wi-Fi.

This study confirms that tourism in the Asia Pacific region is yet another important engine for economic growth. It shows that outbound tourism in Asia is poised to grow further in the coming years. Travel Zoo’s study has also noted some of the emerging trends in the tourism sector. As a result the travel and hospitality businesses will have to respond to their customers’ expectations by offering higher levels of personalised service as well as better quality vacation products. Those tourism practitioners are required to satisfy their customers’ needs and wants, if they want to remain competitive.

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Consumer Behavioural Attitudes: Implications for eTourism

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Last month, the University of Central Florida’s Rosen College of Hospitality Management in collaboration with Elsevier organised the 2nd World Research Summit for Tourism and Hospitality in Orlando. During this inspiring event, one of the keynote speeches featured some interesting findings from a national US survey entitled; ‘The Portrait of American Travellers’. This quantitative study consisted of 2,511 informants (who reportedly were active leisure travellers in 2013); who reside in households with an annual income of $50,000 or more (they also included “affluent travellers” with an annual income over $125,000); who have taken at least one leisure trip of 75 miles or more from home during the previous 12 months (who have used overnight accommodations).

The survey, which was conducted during February 2013, has provided an in-depth examination of the impact of the current economic environment, prevailing social values, and emerging media habits on the travel behaviour of Americans. Unlike most surveys in the travel category this particular study explained how consumers plan, purchase and share information about their travel experiences. It also revealed some of the underlying motivations that often influence travel decisions. Respondents were selected randomly and screened before they voluntarily participated in a 45-minute online survey. The study indicated that all tests of statistical significance were made at the 95 percent level of confidence.

In a nutshell, this American study has shown that the latest advances in technological developments and additional sources of information are increasingly influencing the tourists’ choice of tourism destinations. Apparently, travellers are becoming more frugal in their purchase decisions. They are often making smarter options, seeking better value and good deals in return for their money. Travel shopping sites such as Kayak and Dealbase have gained in popularity and are now used to make travel reservations by 28 percent of travellers. Interestingly, this figure rose from a mere 15 percent in 2010. Meanwhile, six in 10 leisure travellers (58 percent) typically use an online travel agency (OTA) such as Expedia, Travelocity or Orbitz to research travel. Yet, at the same time the use of OTAs to make travel reservations is down from 66 percent in 2010 to 58 percent in 2013.

Evidently, the tourism and hospitality enterprises have become cautious in pricing their products (and services) and they often resort to revenue management tactics. This study suggests that travellers are planning to spend slightly more on travel / vacations as 82 percent of the informants have indicated that they are planning to take as many (or even more) trips in 2014 when compared to last year.

Some of the most significant results of this study include:

  • Low Cost versus Legacy Carriers: Since the cost of travel remains a major issue in influencing leisure travel preferences, it follows that half of all leisure travellers (47%) prefer travelling on a low-cost carrier. Only three in ten (30%) prefer to fly on a full-service carrier. However, one-quarter (23%) have no preference. And it should be noted that leisure travellers are significantly more likely to prefer a low-cost carrier today than in previous years – in 2010 only 42% favoured such carriers.
  • Digital Marketing: More than eight in ten leisure travellers use the internet to either obtain travel information (87%) or make travel reservations (83%). 54 percent have downloaded airline branded apps, followed by hotel branded apps (38 percent), and destination guides (27 percent).
  • E-Commerce: More leisure travellers now access the internet via a smartphone (62%) than from the office (59%). Four in ten (43%) also now access the internet from a tablet. Access to the internet via tablets jumped from 7% of all leisure travellers in 2011 to 43% in 2013.
  • Mobile E-Commerce: Smartphone usage among travellers has nearly tripled since 2010, and the act of downloading travel-related applications has also increased dramatically – from 19 percent in 2010 to 36 percent in 2013. Among travellers who have downloaded travel related apps,
  • Social Media: Only 17% of leisure travellers with household incomes over $250,000 have confidence in the information read or seen on a social media site about potential travel destinations. This is significantly lower than the percentage of those with lower household incomes; 25% of leisure travellers with household incomes of $50,000–$124,999 and 21% with household incomes of $125,000–$249,999 have confidence in social media when considering vacation destinations.
  • Word of Mouth. Eight out of ten travellers (82 percent) expressed confidence in the recommendations of friends and family members when considering vacation destinations, while six in ten (58 percent) turned to online advisory sites such as Yelp or TripAdvisor.com. Approximately four in ten travellers (41 percent) are confident in consumer reviews read on a blog, while slightly less (39 percent) are confident in articles found in newspapers, magazines, TV and radio.
  • Going Green for Green. Though eight out of 10 leisure travellers (79 percent) describe themselves as environmentally conscious, just 10 percent are willing to pay higher rates/fares for environmentally-friendly travel services, and only one in 10 (11 percent) has selected an environmentally-friendly travel service supplier who demonstrates environmental responsibility. Four in 10 (44 percent) indicated that they would probably choose an environmentally-friendly travel supplier who expresses concern about the environment over one who does not.
  • Consumer Outlook: Three-fourths of leisure travellers (73%) are optimistic about their own future and the future of their children (73%), while six in ten are optimistic about the future of their job (62%) or company (61%).

For more information about these latest travel and tourism industry insights are also available on MMG Worldwide.

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