The travel search and booking process has seen many iterations, with the internet, mobile and voice all expected to turn the ecosystem on its head.
While these technologies provided additional channels for consumers and perhaps improved the experience, chaos did not ensue.
Step forward artificial intelligence (AI), which, depending on who you speak to, will either wipe out online travel agencies (OTAs) or boost their presence and power.
However, analysts following the OTAs do not see AI killing OTAs or the search-based travel model.
During the Street Talk session at The Phocuswright Conference, Mark Mahaney of Evercore predicted significant change but no demise.
“I think it’s just going to make the travel research and planning process so much better, so much more robust. It’s a night and day difference, or maybe it’s a night and evening difference.”
He added that the OTAs need to get their initiatives to market quicker and focus on getting higher up in the research and booking funnel.
Others on the panel, which included Lloyd Walmsley of Mizuho Securities and Emma Taylor of Barclays, agreed.
“It is a great consumer experience to kind of consolidate all this stuff and make it really easy to aggregate information,” Walmsley said. “That’s what LLMs are really good at. We’ve all seen the Google thing with data on how many sites people visit before making a booking. I think this will make travel planning a lot easier.”
He also highlighted a potential risk for OTAs in traffic acquisition costs and the likelihood of Google driving less traffic direct to them.
The analysts further discussed an uncertain future for metasearch, pointing to the recent writedown of Kayak by Booking Holdings and Tripadvisor’s focus on Viator.
Additionally, they touched on growth in the tours and activities segment and the opportunity going forward, especially in light of Klook’s planned listing on the public markets.
“It’s one of the segments in travel that is underpenetrated online still. It’s a segment that has a really fragmented supplier base, which is traditionally good for marketplaces. It’s a segment where the take-rate dynamics are generally more positive than in some other segments.”
See below for the full session, moderated by Jake Fuller of BTIG, which also discussed the travel startup funding climate and Airbnb’s move into hotels.
Street Talk: Finance, investment, M&A, IPOs in travel
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