Yeoh Siew Hoon
Yeoh Siew Hoon

You always remember your first time, don't you? Well, the first time we held our Web in Travel (WIT) conference, in 2005 at the Grand Copthorne Waterfront in Singapore, we drew about 140 delegates, a number that pleased us no end because we were happy just to have an audience.

Online travel in Asia was in its very early days. The only people taking it seriously were the handful of online travel companies that had just launched here -- names such as MakeMyTrip, Qunar, Ctrip and Zuji -- and hotel brands that were just beginning to set up distribution and e-commerce teams in the region.

(The first WIT was also memorable because we had a blackout during the opening keynote session featuring the owner of the hotel group whose property was the site of our event. You never forget that.)

Fast-forward to 2016. Last month, we celebrated 12 years of WIT with our annual conference, which drew 530 attendees to Singapore's Marina Bay Sands, and it was amazing to reflect on how far Asia had come in terms of online travel as well as project what the future holds.

Twelve years ago, it was clear that Asia was behind the curve. The common wisdom was, let's look to the U.S. for lessons because three to five years down the road the trends would come to our region. So our content was more about what the major international brands such as Expedia, and were doing and what we could learn from them.

Asia forging its own way forward

In 2016, it is clear that Asia has found its own way. In fact, in some instances, it is leading the way in terms of innovation. China, in particular, is setting the pace in mobile.

Melissa Yang, co-founder of Tujia, China's leading vacation-rentals site, said the reason why WeChat had a better user experience than Facebook Messenger was because it had been designed purely for mobile. In China, she said, when friends go out for meals, one pays and everyone taps their phones to transfer funds to that person. It's a paradigm shift in payments and shows the way messaging apps have become the new distribution channels.

Speaking at an airline conference last week in Amsterdam, Pieter Elbers, president and CEO of KLM Royal Dutch Airlines, said that WeChat was paving the way in innovation for Western companies. He added that the KLM shop on Alibaba attracted more visitors each day than the airline's own website drew in an entire year.

In his first appearance at WIT, Kayak CEO Steve Hafner said his company was making a serious commitment to Asia, and he was pleased with the growth it was seeing. He confessed to making a mistake 12 years ago when he turned down an offer for 25% of Qunar. The offer came from Fritz Demopoulos, co-founder of the Chinese metasearch giant, which was eventually acquired by Baidu and later by Ctrip.

Google executives also took the WIT stage for the first time to share their travel plans. Eric Zimmerman, director of Google Travel, reassured those in the audience that the company was out to make travel easier for customers, not to eat the industry's lunch.

"We're very focused on a wide gamut of travel problems," Zimmerman said. "Many of them overlap with things people [in the industry] are doing, but a lot of them aren't. We're really excited to connect with users to help them finish with their paths and move on to have a really nice trip. That's what matters to us."

Expedia, which celebrates its 20th anniversary this year, has clearly grown wiser through its experience in Asia, where its joint venture with AirAsia gave it a local partner that knows the area well and has regional reach. The AirAsia group has flown 60 million passengers in its 15 years of operations and is one of the largest people movers in the region.

Senior Expedia executives Cyril Ranque (lodging partner services) and Greg Schulze (in charge of anything that moves as senior vice president of commercial strategy and services) went onstage to share what Expedia was doing in the region.

Ranque said the tipping point for Expedia came when "we agreed to lock away our egos in the closet" and worked as a team to harness the global opportunity. Schulze relocated to Singapore in January to be in the thick of the region, the first time a global head at Expedia has been based in Asia.

Don't ignore the local giants

But as important as the global brands are in terms of how they are expanding and investing more resources into the region, the diversity of Asia also means there has been plenty of room for homegrown brands to grow and consolidate the hold in their markets during the past 12 years. What's more, all are innovating to stay ahead.

According to Phocuswright, Ctrip is the world's third largest OTA, in terms of global gross bookings, after Expedia and Priceline, and there seems to be no slowing its momentum. Earlier this year, it invested $180 million in India's MakeMyTrip, the other OTA giant in Asia. As WIT opened, there came the news that MakeMyTrip was merging with Goibibo, a move straight out of the Ctrip playbook: Buy out the competitor that's creating havoc in your market.

Jenny Wu, Ctrip’s chief strategy officer, speaking at the Web in Travel conference, said the key strategy for the company is to bring offline customers online.
Jenny Wu, Ctrip’s chief strategy officer, speaking at the Web in Travel conference, said the key strategy for the company is to bring offline customers online.

Jenny Wu, Ctrip's chief strategy officer, called it a milestone for the India market and said the consolidation would enable the two companies to "make a truce, put irrational competition aside and now refocus their energy on the real business and to think about how to improve products, efficiency and service for customers."

What's interesting is Ctrip's strategy to bring the offline market online, where the bulk of travel is still sold in Asia. That same week, it bought a controlling interest in Traveling Bestone, which has more than 5,000 brick-and-mortar storefronts in smaller cities in mainland China.

Wu said she watched the company for two years and found it had made great progress on its mobile platform. "The key to crack the online segment is to bring the offline online," she said. "It will help speed up penetration in lower-tier cities."

Alitrip is also not to be discounted. Being part of the massive Alibaba marketplace gives it power and customer reach. On Singles Day (Nov. 11, 2015), the one day when China's singles go crazy on shopping, Alitrip recorded 1.5 billion transactions and sold more than 800,000 outbound products, 860,000 room nights and 300,000 international plane tickets.

In Japan, Rakuten Travel recorded $4.7 billion in gross merchandise sales in 2015, a 16.4% growth over the previous year, selling 39 million room nights. As part of the Rakuten marketplace, it has access to customer data, which it is using to become a matching platform between hoteliers and customers rather than a booking platform, and its membership-based model differentiates it from other OTAs in the market.

In South Korea, the daily-deals site Tmon has emerged from out of nowhere to become one of the top three players in travel, thanks to the swing toward mobile commerce in that mobile-savvy market.

So what will it take to compete in Asia during the next 12 years?

Patience. Asia is a long-term game. Even if Kayak's Hafner had taken up the 25% offer in Qunar, he would have had to wait at least eight years before he saw rewards. But what a reward it would have been.

I can rattle off the rest -- commitment, talent, the right partners -- but I think the most essential quality you need is the courage to disrupt yourself.

When asked who Ctrip's competition was, Wu replied, "Ourselves. Whether it is for a company or person, the most competition should be yourself. You should challenge yourself and go beyond your boundaries. Think about how to challenge yourself and go beyond your boundaries to achieve another level of success in a more efficient way."

So if you think the last 12 years has been a time of rapid change, you ain't seen nothing yet in Asia. Prepare yourself for a wild ride into the future.


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