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New generation of DIY travellers means opportunities for SMEs

Technology has been known to transform industries radically, and tourism is no exception.

Although technology in transport has barely changed over the past two decades, besides improved efficiency and safety, the tourism industry is at the dawn of yet another information-technology transformation - brought by a new geAnd I am witnessing such a transformation first-hand while travelling across Turkey and now residing in Istanbul.

No, I am not talking about a website, a Facebook page or a mobile application that makes making reservations easier and faster. These innovations are already here and still transforming some part of the industry, albeit gradually becoming less important.

Their main usage has changed from supposedly learning about and booking a facility to merely confirming maps and contact information, and for selected promotional campaigns. Owning a website is of course still needed, but less will be gained from it.

More realistically, most hotels and restaurants are now linked with bigger engines such as Agoda.com and Booking.com, which provide similar services to the facility's own website and more. Millions of travellers flock to these websites every year, looking for comparisons of deals as well as more information on facilities. And that is just the beginning.

To grasp the importance of this technology transformation fully, one needs to understand the new generation of travellers.

There are two types of travellers - those who travel on their own or group tourists. It used to be that only the wealthy and well connected could travel on their own, while the rest of us took a group tour. The size of the group would depend on the traveller's budget.

To the other extreme, of course, there are backpackers. Armed with a Lonely Planet guidebook, they can visit the remotest areas and stay in the most rugged and minimal accommodations.

Technology has now paved the way for do-it-yourself (DIY) travellers, as information comes at a cost of close to nothing. With free Wi-Fi now abundantly available at most destinations, they will travel with more information at their fingertips, with more choices and more specific demands.

These are not rich travellers, but middle-class with a stable income. They are typically younger, well-educated people. Though not perfect, they are confident in their language skills and are willing to venture out on their own to craft their vacation according to personal preferences with little or no assistance.

More important, they trust peer reviews and user feedback more than tour guides and official websites. Many even go so far as trusting anonymous reviewers more than the recommendations of their own relatives.

Now, those who have read up to this point may start to say there is nothing particularly new about this. After all, tourists have been buying and carrying guidebooks and reading up on information online for a few decades now. But our experience on this trip to Turkey begs to differ.

Equipped with user- or peer-reviewed information, these DIY travellers visit strictly the places with high ratings from TripAdvisor or recommendations on the Wikitravel website. Within their budgets, they will also only book hotels with rave reviews by other users on Agoda and Booking.com, and are willing to sacrifice stars and facilities for better service and convenience, hence rooms for service-minded small and medium-sized enterprises to fill.

Markets get segmented into clearer niches, where there could now be multiple winners in different playing fields.

The merit cycle is thus created. Places with rave reviews attract more visitors, while more visitors with good experiences write more good reviews.

Hotels and restaurants are now tapping this trend. They aim not only to provide good service to heighten visitors' experience, who often are foreigners they are unlikely to meet again, but also to provide more personalised services in exchange for reviews on these websites.

And they will deliberately make it known to the guests and ask for a rating of their experiences online for them. In other words, good service can now bring more physical and tangible returns than before.

During our trip, we have been asked by hotels and restaurants to help review their service as well, of course after they are certain of the quality of the service we have received. They do this for each and every customer, providing nothing fancy in exchange, just a pure service mindset.

The important point to take home here is, with the Chinese government cracking down on its zero-dollar tours, the new generation of Chinese tourists will grow in importance. DIY tourists emerge from growing incomes and higher education - the ingredients we find easily in Asian travellers nowadays.

In other words, marketing in tourism now comes from user-generated reviews. And these reviewers are the new generation of travellers you will see walking through your front door today.

The views expressed in this article are those of the author and not of TMB Bank or its executives. Benjarong Suwankiri, head of TMB Analytics, the economic analysis unit of TMB Bank, can be reached at tmbanalytics@tmbbank.com.


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