< PrevNext > Trend: Technology Innovation Platform Wars and the Battle for the Online Transaction By GoldSpring Consulting Managing Partner Will Tate / January 24, 2022 Share Travel Management Companies. Web Browsers. Online Booking Tools. Mobile Applications. Competitors, choices, combinations, collaborators or just clutter? Smart buyers always evaluate program components of individual gains versus larger, strategic gains. The part versus the whole.The 2021 buying spree among managed travel players portends significant changes for 2022: legacy TMCs buy booking tool-first TMCs (Amex GBT/Egencia), booking-first TMCs buy legacy TMCs (TripActions/Reed & Mackay), European TMCs buy US TMCs (TravelPerk/NexTravel), expense management buys travel tech (Emburse/Roadmap/DVI), charge cards buy expense management (U.S. Bank/TravelBank), and so on. How do we make sense of it all in one word? Platform.For travel buyers, platform is the supporting framework or the base from which a service is provided. For managed travel providers, it is a suite of services that enables more engagement, more control and more profit. What remains is the chase for transaction volume and related supplier revenues.But it hasn’t always been this way. TMCs welcomed others to create online booking tools. Online booking tools wanted no part of expense management. Expense management was eager to be stand alone. Travel providers stayed in their lanes and were downright giddy to do so. What changed?The common barriers to innovation were removed with technology improvements. Automation enabled lower capital investment, personal technology usage created corporate demand (market readiness), legacy technology (data centers) morphed to cloud computing, and wide access to distribution channels carved a path for integration. Fueled by excited investors with larger-than-expected valuations, travel platforms have grown exponentially in size and offerings.Amazon and Netflix get it and provided the winning model. They built platforms where users stay and get their needs met in a user-friendly interface, providing both quick access and personalization (recommendations) which build both engagement and loyalty. We are beginning this journey with integrated travel management platforms. Key Impacts in 2022Buyers can expect the following key impacts in 2022: online booking improvements, mobile emphasis, closed systems and more emphasis on supplier revenues—all accelerated by artificial intelligence and machine learning. Online booking began simply by automating the traditional travel agent processes. Now it has evolved to consumer-style offerings to match the consumer online experience. As non-TMCs developed the first tools, fulfillment efficiency was not at the top of the roadmap. TMCs bear the brunt of any online booking service issues while paying a reseller fee. 2022 will see TMCs taking more control over service of this booking channel while improving their margins.For these very same reasons TMCs will also emphasize mobile in the hope of replacing online booking channels. Further, TMCs can then leverage their other complementary technologies: chat, AI and machine learning, to name a few. TMCs also gain scale to maximize supplier revenue programs.Open systems will be another trend. Those permitting wide integration with other technologies hold the promise of options and content galore. The reality often results in integration costs, process inefficiencies, service issues, confusing merchandising and unfulfilled expectations. Closing the loop solves for these with greater control over service delivery, system effectiveness, customer service and supplier incentives.With more platform ownership, there is greater control over content and related offerings. One of many possible examples is the TMC proprietary hotel program. Significant investment expects significant returns, so providing these proprietary programs in every possible channel (mobile, online, telephonic and chat) creates the best possibility for increased throughput and TMC revenue.2022 will certainly see significant market changes. However, challenges remain. Working in a single country with single currency is very different than working with multinational client needs. Consolidation will mean less client customization, more standardized approaches to different markets, and longer lead times for architecture changes.Stakes Increase as Platform Plays ProliferateWise buyers will do as they always have: They will evaluate, measure, test, execute and then loop back to evaluate these platforms against their strategic imperatives. Now that many program component parts are part of the same whole, the altitude of competitive analysis has risen.It’s the age-old part versus whole. And our industry has courted both approaches. Lately though, for online, the platform whole is emerging the winner. Technology evolution has enabled this, earning TMCs and travel suppliers more loyalty on the front end, while an open systems model aids efficiencies on the back end. For suppliers, the product holy grail of more control over content and a broader range of offerings ensues. For buyers, the competitive thickening of big against big, means broad-scale evaluation and assessment of providers needs to be routinely conducted to ensure choice fits strategy. That’s how the buyer wins.