Skift Take

Domestic leisure travelers in Asia are booking at vastly shortened lead times and the usual channels to generate demand are no longer enough. Is this the start of a more equal distribution landscape for suppliers?

Asia’s domestic travelers and their last-minute booking habits are opening new ways for travel operators in the region to generate demand.

Mobile and social media, already gaining traction before Covid-19, have risen in eminence as sales channels. Providers that are adjunct to travel, such as ridehailing, food delivery or chat messenger apps that have huge local followings, are increasingly seen as effective partners to reach the domestic market.

Live streamings — whether outright tactical sales or inspiration sessions to induce desire to visit — are on the rise.

Dramatically-shortened booking lead times, coupled with technology-savvy Asian customers, have “significant ramifications for our industry as it looks to rebuild,” said Cyril Tetaz, executive vice president, airlines, of Amadeus Asia-Pacific. For a start, airlines, hotels, and tour operators now have a much shorter window of opportunity to engage travelers, and urgently need to adapt their marketing and business strategies to cater to the nuances of the last-minute market more than ever before, he said.

SiteMinder’s regional vice president of Asia-Pacific Bradley Haines also noted that paths to purchase are now much shorter. It is important hotels ensure they are bookable through a variety of sales channels, particularly on mobile and social media where consumers are spending more time than ever before, Haines said.

Loss of Monopoly?

A session at day one of the Hotel Investment Conference Asia-Pacific on Wednesday described suppliers’ move to embrace new channels as a “democratization” or “loss of monopoly” and the start of a “more equal distribution landscape for suppliers.”

Amadeus data shows domestic flight bookings across Asia-Pacific are now made 17 days later on average compared with last year. Indian travelers are the most last minute, booking 10 days before departure, a 68 percent decrease compared to pre-pandemic. They are followed by Thai and Singapore travelers, 21 and 25 days before departure respectively — about half of what it used to be.

Skyscanner’s data shows an even shorter booking time-frame. Globally, searches with booking windows of under one week have risen 12 percent over 2019, coinciding with a 13 percent increase in searches for domestic travel.

A key reason why domestic leisure travelers are booking last minute is they fear changing travel restrictions. On the other hand, they are also more familiar with their own backyard, hence are comfortable in making booking decisions later.

Airlines, hotels, online travel players and tour operators have done much to encourage bookings, offering flexible cancellation policies, heightened hygiene promises, favorable prices and other measures. But with everyone competing for largely a single source of domestic leisure travelers, it has become a question of how many ways there are to reach them in order to communicate those efforts.

In short, demand generation has splintered into many different avenues than just the usual channels., for instance, is expanding strategic partnerships such as the ones it has with ride-hailing Grab, chat messenger app Line and cash-back program ShopBack. Interviewed at Skift Forum Asia last week, its vice president & managing director Asia-Pacific, Angel Llull Mancas, said these partners generate local demand that would find “historically complicated” and “expensive” to get on its own. In some markets, they could even produce more than Google, although the behemoth is an important demand generator.

“We are trying to be as local as we can [by partnering with] third parties that know the market well, particularly in Southeast Asia,” he said.

Social and Mobile

More than 55 percent of Onyx Hospitality Group’s business is now referred to by social media, compared with less than 20 percent previously, said its vice president digital & CRM, Chetan Patel, during another session at Skift Forum Asia.

“It’s a function of how the local market, namely Thailand [where Onyx is based], uses social media. This is a great learning for us. We had a lot of followers after we learnt that this was how they were purchasing,” said Patel.

He described social media as the “dream” booking stage for travelers, thus it’s about “how your brand inserts itself in this conversation.”

Another rising channel is simply the good old telephone. Patel sees a “huge number of travelers who just want to pick up the phone and negotiate a deal with the hotel.”

Mobile booking has accelerated even further in Asia. Travel companies such as Klook, which has a mobile-first approach, launched a livestream mobile feature in late September, enabling users to grab exclusive promotion codes and book tours, staycations, dining, et cetera, live on-the-go.

“Our livestreams in pilot markets saw a four times average uplift in conversion rates compared to in-app conversion rates on an average day, signaling the immediacy in users’ booking behavior. Also, Thailand’s staycation surprise deal sold out in just eight minutes, while in Singapore, two out of three staycation bookings made within 24 hours were direct conversions as a result of the livestream,” said Marcus Yong, Klook’s vice president marketing Asia-Pacific.

Following the pilots in Hong Kong, Taiwan, Thailand, Singapore and the Philippines, Klook Live! will be launched in Malaysia, Vietnam, Australia and New Zealand soon, and in the UK later in the year.

Domestic demand is “a lot more” spontaneous than cross-border travel, said Yong, with lead times in markets such as Hong Kong, Taiwan and China now shortened by up to half.

From a supply perspective, it accelerates digitization in the fragmented tours & activities sector to meet local users’ demand for instantly available offerings. Yong expects this will provide inbound users with a more seamless booking experience when international travel returns.

Pent-up Demand

In India, the most last-minute market going by Amadeus data, tour operators such as Thomas Cook India and sister SOTC Travel quickly adapt themselves to a growing demand for bookings that are at short notice — between five and 10 days, compared with 21 to 45 days previously.

Rajeev Kale, Thomas Cook India’s president and country head of holidays for MICE & Visa, attributed the last-minute booking trend to pent-up demand for travel.

“With the combined burden of official/business work and home-work/chores, India’s travelers especially the young working professionals and millennials are increasingly seeking to break away from the routine and avail themselves of a quick break that does not require much planning and offers an opportunity to rest, relax and rejuvenate,” Kale said.

Thomas Cook and SOTC have responded with products such as so-called workations, staycations, affordable luxury and hidden gems of India, among others, and doing marketing and messaging through social media.

“In the current context, we are making extensive use of social media to reach out to our customer. Hyper-local communication via WhatsApp and social media are being leveraged by us to maximum advantage. We have also conceptualized virtual outlets through which we are able to assist customers preferring contactless services to assist via phone, chat or a video call,” said Kale.

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Photo Credit: Spontaneous Asian travelers. Photo credit: Klook