BTN's annual answer book for business travel managers.
Renaissance Atlanta Waverly - May 12, 2019
New York City - May 17, 2019
Seattle Marriott Waterfront Hotel - May 21, 2019
TripActions' Ariel Cohen talks:
Artificial-intelligence enabled mobile booking and travel companion TripActions rolled out a new version of its app at the Global Business Travel Association convention in San Diego. The startup also rolled out the red carpet for travel buyers, sponsored a main stage session and had a sea of T-shirted employees raising brand awareness. Co-founder and CEO Ariel Cohen sat down with BTN editor-in-chief Elizabeth West.
BTN: TripActions' total raise at this point is $51 million. What are you spending it on—besides the big marketing push at GBTA?
Cohen: We are investing in two areas. Obviously, we continue to invest in our mobile app or Web app, going to more and more capabilities. Even more importantly, the infrastructure. If you want to be a disruptor in this space, you have to challenge the infrastructure.
BTN: Who do you consider your competitors?
Cohen: We're never shy on the fact that we want to take the market, so our competitors are Amex GBT, BCD, Carlson, Egencia. And we are very capable and very successful on replacing them.
BTN: I've never seen TripActions referred to as a travel management company. Do you consider it a TMC?
Cohen: Definitely. We are a TMC. We are a new kind of TMC. We aren't adhering to the rules of the industry in terms of who is the most important person: the user or buyer. We think the user is really important and then comes the buyer, so that's different than a traditional TMC model. We are also not as obsessed on back-end commissions and stuff like that. I'm very bullish about creating value [for] our customers. [The fact that we have] the ability to charge for this value suggests that we are creating value. Being highly dependent on others [for revenue] isn't a value-based business model. So we are a TMC, but we area completely different TMC. That's what a disruptor does, right?
BTN: Part of TripActions' disruptive power is its technology not only to bring in content but also to rationalize it through machine learning.
Cohen: TripActions is about creating choice, and that creates trust. If you bring all the inventory that is out there, it creates trust with the traveler and also with the [corporate] customer—things like [global distribution content] and corporate discounts. The traveler wants to see that everything out there is on the platform. Once you bring it all in, you have potential for a mess. [To make sense of it], you have to take very textual content and make data out of it. You need to take a hotel room description, for example, and make data out of it. Then you can run machine learning and create a match between the traveler, all his past behavior, other employees in the company or other companies that look like this one. It is really trying to understand the traveler, trying to understand if this room comes from a specific vendor, with this price, with these terms and conditions, etc. and creating a match. We don't automatically book for the traveler, which by the way, we could. We can predict with 90 percent accuracy what the traveler will book, but we don't think the market is ready for that. We want the traveler to choose.
BTN: What about on the agent side? They have to deal with all that content, as well.
Cohen: As much as we are investing in the external product, we're also investing in the agent's product. It's an environment that is masking all the other environments—whether that's Sabre or Expedia or Priceline or Booking.com. We also are bringing in low-cost carriers in Europe, in Asia/Pacific via direct connects and aggregators. Internally, we have what we call the trip ID, which is an itinerary. You can have a [passenger name record] that comes from Sabre that covers a certain portion of the trip, and you can have another trip ID [or] PNR that comes from another vendor. We merge it all [in the agent environment]. When you chat with [a TripActions agent] and change a leg, we immediately know that it impacts other parts of the trip. So we're asking, "Hey, do you also want us to change your hotel?"Internally, the agent doesn't look at this as a PNR. He looks at this as a trip, which is very different than the industry, where they are just going to Sabre. We found a way to [merge all the trip elements from all the sources] and mask the complexity.
BTN: Enabling proactive agent support is an important concept for TripActions. Visibility into the downstream effects of an itinerary change is part of that, but what else is involved?
Cohen: Over the years, we added a lot of AI that can personalize stuff, and then we started focusing a lot on support. If you want to create a solution people like, you have to do proactive support. We [can] identify travelers [who] are going to have an issue way before the airline does. We reach out to the traveler through the app [and say], "Hey, you have this problem. Here are possible solutions. Just choose one." We embed options inside the chat, and the traveler chooses. At that point, we do the full circle with itinerary. That's why we need that environment for the support agent to know the trip, to know everything about the traveler [because] personalizing it is very important. [The agent needs to know] the traveler's last Net Promoter Score, which is the measure of satisfaction, who they work for, what's the [travel] policy there? Then [the agent can] chat with the traveler and solve the issue. This is a big, big part of our investment. We get 97 percent satisfaction on our support.
BTN: What's changing with the traveler-facing mobile app?
Cohen: [In the booking path], we want to get down to the level of what type of seat they will get and what the chair looks like [on the plane]. You don't get all this from a GDS, so we think direct connect is important. We also have agreements with several providers right now, and we are implementing them as [part of] the travel companion piece of the app. There are integrations with Uber and Lyft, and we are building now the integrations to providers that will give us the airline boarding passes, seat information, pictures of the seats, everything. This is really important—and I don't think we realized this when we started—but if you're creating a lot of choice, you cannot assume that people have the [mobile] app of the airline or the hotel or the provider that they booked from. To be useful to the traveler, we have to be able to provide those integrations and push the notifications and information to the user. It's a work in progress, and we are rolling it out now.
BTN: How is machine learning providing smarter choices for travelers?
Cohen: In hotel selection, for example, you can sort it out based on loyalty clubs or you can sort it out based on our rewards feature, which saves the company money. You can sort it out by double dipping: loyalty club and our rewards. On airlines, because of branded fares, we are capable of telling the traveler, "Hey, you can choose this, but economy plus on Airline B costs the same [as] economy class on Airline A and business class is not as expensive as you think." So you present choices to travelers in a way that also offers a lot of knowledge. Of course, travel policy [limitations] are also important, but using machine learning to create knowledge and relevance for the traveler is really, really interesting.
BTN: TripActions takes hotel commissions and has preferred suppliers. If that's not a central revenue stream, where are you making money?
Cohen: We have to get back to the value. We can eliminate all the noise around travel. We can make it go away. We charge for it. We charge a platform fee. We charge for our customer success services. We have the booking fee, but it's one booking fee, not a transaction fee or [a fee if] you call an agent versus booking online. We've simplified and we've averaged it out. The traveler can call us, contact us, as much as they want; that's in the booking fee. We do make money from hotels and from airlines in a traditional way. Because we can make money on the platform, on the booking fee,we are not bullish on trying to lure travelers into booking the stuff that is more for us.
BTN: You say you're competing with the mega TMCs. Can you support global customers?
Cohen: Definitely. That's why we have gone global so fast. Our first global office was in London, and it's really following our customers. Box has a big presence there, and Bowers & Wilkins. We've also just opened a really big office in Amsterdam, which will be our European headquarters. We brought in the head of global customer support of Netflix to manage our organization there. We are expanding into Melbourne, Australia, into Singapore. We've just launched a solution for Box in Japan.
BTN: Australia is an interesting choice. Serko is big there, and the company has a similar content philosophy to TripActions.
Cohen: You saw me smiling because I think there is a great opportunity there. I was talking with customers there, or potential customers, and I think there is a great opportunity. Every place that I've visited, there is a great opportunity. The market is waiting for somebody to come and really present something that is more "today." And so the opportunity is everywhere.
BTN: Do you see profitability around the corner?
Cohen: You can't raise money at the levels we are raising if you cannot prove to investors that on the unit level, you are profitable. Now we are investing a lot in marketing, in growth, in infrastructure, which of course makes us not profitable. It's a huge market, and we want to take it. I don't see ourselves as a company being profitable anytime soon. On the unit level, however, we'll always be profitable. I think that's the only way to know if you're driving a good business.
Robotics process automation provider Troovo's software routes payment decisions based on each client's...
Global Business Travel Association VP of government relations Shane Downey said GBTA lobbying has...
With more than 750 aircraft across its operating companies, private aviation management company...