Identifying a competitor is an art and a science. In 1960, Theodore Levitt coined the term “marketing myopia” in a classic Harvard Business Review paper, pointing out that companies don’t ask the vital question, “What business are we in?” In the midst of today’s knowledge disruption, with buzz words such as blockchain, augmented reality, artificial intelligence, and biotechnology, the possibilities go beyond digital versions of existing business models.
Travel, intangible and evolving, is a perfect example of a product particularly vulnerable to marketing myopia. Who would have imagined high-end business travelers staying at Airbnb listings? Why travel when one can attend conferences from home? Why go on a vacation when the hassle of a busy airport is the first thing that comes to mind?
While companies such as Hilton, Marriott, Hyatt, Accor and others indeed compete with each other for a hotel stay, they compete with completely different verticals and industries for the customer experience. Thereby, as technology re-defines experience design, if travel companies keep seeing each other solely as competitors, rather than potential partners, they may help create the conditions and possibilities that will hurt or even drive them out of business.
Travel companies must get the next winning technology firsthand and effectively incorporate it in their product, rather than have such technology emerge as a competitor or be adapted so late as to provide minimal value for the customer.
Keep in mind that While partnering with cutting-edge startups seems logical, this strategy requires a mind shift from both the travel industry and the startup ecosystem.
The travel industry has a lot of homework lying ahead. It is behind, lacking an “innovation DNA” and fragmented, sometimes with systems that date back to the 70’s.
We can see that there is a large gap in development between traveltech and other areas such as fintech, biotech, autotech, just to mention a few.
Entrepreneurs tend to focus on industries where scaling up seems easier or where they see stronger organization commitment, And While there are startups in travel, most do not succeed, or end up switching to other industries. Besides, customizing a product for a particular travel company can seem exceedingly labor intensive, expensive and time consuming, so developers end up taking their innovation elsewhere.
The travel vertical not only must understand the ultimate importance of actively searching innovation but also must become much more appealing to tech entrepreneurs than it is today.
In order that the travel companies will remain relevant and innovative – they must embrace open innovation and collaboration.
That way, the startup will gain a strategic customer, learn on a specific industry, and make sure that its product is viable and ultimately grow faster and drive higher return to its investors. This way the organization will get access to a tremendous talent pool that not only is expensive to buy but often not available except via this type of collaboration.
Therefor creating an alliance of multiple travel organization, that together will have the scale and the reach and be the doorway to the travel industry for emerging technologies is paramount. This alliance will be collaborating with cutting edge startups and be able to compete with other industries and be attractive due to its size and diversity.
Let’s open our minds, see what other industries are doing and think outside the box. Alone, even the biggest travel companies are still rather small but together we can be the strongest and most influential industry. Let’s collaborate.