Observations in the Canadian travel market.

Mike Price, CEO Inspiretec North America, pauses for thought to reflect on the last year at Inspiretec and what is to come within the Canadian travel industry.

By Mike Price8th June 2018

It is an interesting time to be providing technology in the travel space. We currently help two large banks’ clients redeem travel via the points accumulated on their credit cards and the loyalty redemption space is going to go through a substantial change with Air Canada choosing to end their relationship with Aeroplan. It’s been a focus of many consumers for many years in Canada to accumulate as many points as possible for their own leisure travel.

Redeeming loyalty points.

Clearly Air Canada will have a solution in place ready for when the agreement finally ends in 2020. What does not go away is the expectation by a consumer to be able to accumulate points for their everyday purchases. The cost of the points gets priced into the same goods they are purchasing, so in effect the points purchased are not free. However, since the practice is so widespread you would struggle to get the equivalent value selecting cheaper goods that do not attract reward points. In that sense I do not see the importance of providing the ability to redeem points for travel diminishing.

An old model.

We also have a relatively mature travel industry that is still stuck in a relatively old model. The missing element is true low cost flying to date. Swoop, an off shoot of WestJet is being launched and Rouge for Air Canada Vacations provides the equivalent of charter flying to its core destinations. However, to date there has been no widespread Ryanair/EasyJet type of offering. At the same time the lines between the large retailers and wholesalers become more blurred as retailers explore dynamic packaging and buying beds either direct where possible or from bed banks. Retailers now regularly attend trade shows to talk directly to hotels and tourist boards looking for marketing money in return for directionally selling.

The desire for flexible travel.

There is also a clear desire by consumers for more flexible holidays than the classic seven-night package. The average consumer might have only three weeks holiday and is attracted to a four or five night break that does not use up so many days. There is a desire for some new destinations that are not the classic Cuba/Mexico/Dominican Republic all inclusive break.

The need to fully understand our clients.

How does this all affect a company supplying travel technology in Canada? It is clear that our clients who provide the travel options for the end consumer need to have the most flexible systems to meet the demands of their clients. The ability to have an intelligent CRM system to understand clients needs and wants helps in the process. Retailers need the means to directionally sell a given hotel chain or destination. The key word in the end - for our own clients and indeed the end consumer - is choice. We need to provide the ability to enable a wide range of choices, quickly and attractively.