The Travel Retailer Of The Future - Amadeus

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The TravelRetailer ofthe FutureResearch Paperamadeus.com

Table of ContentsForeword by Pascale Caron3Setting the sceneA new generation of travel storesImpact on the travel ecosystem4Research Methodology & ApproachOur Mission: to take Generations Y and Zto travel agency storesOur team from The Sustainable Design SchoolWhat is Design Thinking?A qualitative study at the starting pointof the analysisBenchmarking current concept stores,not focusing solely on travelDefining and creating our personasA new travel experienceThe designer of travel experiences5Key findings and innovative solutionsA travel constellation with four innovativeconcepts: Share & Go app, QUA,Take me Along van and IFTHEA9Travel Retailer of the Future and beyond15Conclusion16About The SDS17About Amadeus18

Research paper The Travel Retailer of the FutureThe Travel Retailerof the FutureForeword byPascale CaronAssociate DirectorGlobal Consulting & Pre-SalesAmadeusMost travellers between theages of 20 and 30 yearsold have never set foot in aphysical travel agency before.And why should they?They are digital natives.Travellers are driving changeand forcing providers to evolvetheir business models to meetnew challenges. In response,travel retailers are evolving tooand are adopting new ways ofinteracting with younger generations.To help our travel retailer customers define theirbusiness for the travellers of the future, we’vedeveloped some business disruption scenarios incollaboration with The Sustainable Design School (TheSDS), based in Nice, France, which uses Design Thinkingas a way to approach sustainable innovation.The Sustainable Design School matches newgenerations of creative, curious students who areconcerned about our planet, with enterprises andindustries that are looking for new talent in designand sustainable innovation.Design Thinking is a methodology used by designersto solve complex problems. A design mindset isnot problem-focused; it’s focused on solutions andactions which can lead towards creating a preferredfuture. Design Thinking draws upon logic, imagination,intuition, and systemic reasoning to explore possibilitiesof what could be and to create desired outcomes thatbenefit customers.The objective of our research paper is twofold:1. To help travel retailers with physical storesattract younger generations who have neverbeen inside a travel agency retail shop before2. To inspire the travel retail world with innovativeideas and new perspectivesResearch Sources: The Sustainable Design SchoolThe results of our joint project are definitely an eyeopener. New generations want to be informed andinspired by real experiences — not by glossy brochureswith "photoshopped" imagery — and to have fullemotional experiences. Most importantly, they want tobe in control of their decisions and make smart choices,while having it all at their fingertips.Based on their research, The Sustainable DesignSchool imagined four innovative concepts thatmost appeal to Generations Y and Z’s way of life:Share & Go: a mobile app that connects a travelconsultant (the TOM, a Travel Organisation Manager)to potential travellersQUA: a solar-powered capsule that provides avirtual 360-degree immersive experienceTake me Along: a bus van people can hop on/off tohelp them find the type of vacation that matchestheir profile. They will enjoy a full physical and virtualjourney with a small group of their friends whilegoing from A to BIFTHEA: a new kind of travel agency experiencebuilt around the concept store modelWe believe this research paper will catch the interestof leisure travel retailers and online travel retailers alike.At Amadeus, we can accompany travel retailers onthe IT side thanks to our consultancy and innovationteam. The future is yours to decide – and this is just thebeginning. So, let’s shape the future of travel together.3

4The Travel Retailer of the Future Research paperSetting the sceneA new generation oftravel storesWhen you buy an iPad or an iPhone, do you go to theApple Store or do you go online?Some of you may answer online, but many still go tothe Apple Store: why?Because it’s a convivial place where you have access toexperts who can give you all the information you needbefore making a purchase. Some stores even organiseworkshops on specific topics to help you find what youneed, and to learn to use their products with ease andefficiency. It’s all about enjoying the experience.This is what some players in the travel industry,mainly retailers, have achieved with their newgeneration of concept stores. They’ve redesignedinteriors to create a more modern look and feelcoupled with new technology.Experience stores offer a technological touch thatappeals to a general sense of lifestyle by offeringmerchandise that matches customers’ aspirations.They focus on new features including, for example,a cosy interior design, smells and sounds, workshopand conference spaces, food sampling and bookshops.All of these features have a focus on blending apersonal and human touch with digital technologies.It’s a growing trend in travel: Thomas Cook’s researchshows that two-thirds of those who research theirholiday online go to travel retail stores, as they stillvalue speaking face-to-face with a travel expert whocan help them design a holiday that best suits theirneeds. TUI has refitted its stores adding digital andinteractive screens (exit paper posters!) and morefriendly, welcoming areas, in order to appeal to youngtravellers and help convert them into loyal customers.A French tour operator should reach 120 stores by theend of 2017, versus just 40 last year.From a purely travel retailer viewpoint, Flight Centreinitiated the same move with its ”hyper stores”, and STATravel completely refitted its stores to appeal to andinspire younger audiences. Another travel agency basedin Madrid also offers a coffee corner, a place for travelconferences, and an exhibition space.Most interestingly, we've noticed that many of theleisure online travel retailers have also embraced thistrend. For instance, in France, a purely online playerbought a French tour operator with retail stores.MakeMyTrip, a leading online travel agency in India,is opening physical shops to increase its reach tocustomers in areas without internet access but withhigh mobile penetration.Travellers are embracing this new experience. AfterHavas Voyage redesigned its retail stores in France,it noticed that seven out of ten people who walked inpurchased a trip with its agents, compared to only fiveout of ten before the refurbishment. In addition, thetravel agency’s new look attracted 25% new visitors.Impact on the travelecosystemMost people below the age of 30 have never walkedinto a physical travel agency store before, and gettingdigital natives to show up in person rather than onlinetakes some innovative thinking. Our joint research withThe Sustainable Design School shows that there couldbe opportunities for online players to strengthen theirbrand by establishing an offline presence groundedin travel.To create this paper, we asked The Sustainable DesignSchool to use scenario planning to map trends anddevise potential pathways to create a picture tailoredto our customers’ needs.We strongly believe that travel agencies need toreinvent their in-shop experience and have a futurestrategy for seamless integration between physicaland digital worlds. At Amadeus, we’re here to helpshape this future for travel retailers.In every sense, the best way to predict the future issimply to create your own.Source: Amadeus

Research paper The Travel Retailer of the FutureResearch Methodology& ApproachOur mission: to take Generations Y and Zto travel agency storesGeneration Z (aged today between 5 and 20 yearsold) are the adults of tomorrow. The influence thattravel companies have now will affect their purchasingbehaviour when they have children and even when theybecome the active seniors that are the bread and butterof today's travel retailers.Generations Y and Z are digital natives, but they oftenmiss having a physical and human connection in thisdigitalised world. This presents an opportunity forinnovation.To help us think outside of the box, Amadeuscollaborated with eight students aged between18 and 22 years old from The Sustainable DesignSchool in Nice, France. As digital natives themselves,they are best positioned to apply a Design Thinkingapproach to come up with new ways of combining thedigital and human aspects of travel retail.Our Team from The Sustainable Design School5

6The Travel Retailer of the Future Research paperWhat is Design Thinking? A qualitative studyDesign Thinking is a human-centred design approachat the starting pointthat helps solve complex problems in diverse areassuch as products, services, spaces, systems, businessof the analysismodels and strategy. It takes into account the targetuser’s socio-economic group, values, culture and theenvironment.Design Thinking values are based on optimism,empathy, collaboration, experience andexperimentation. The school focuses on designingsustainable solutions while taking into accounttechnological feasibility, business viability anduser desirability.Most importantly: Design Thinking has been proven tohave a positive impact on business.According to the Design Management Institute, whichanalyses the performance of US companies committedto Design Thinking, with its DMI* Value Index, 2014results showed that over the last ten years, design-ledcompanies have maintained significant stock marketadvantage, outperforming the S&P by an extraordinary219%**. As an example, two out of the three cofounders of Airbnb are graduates of the Rhode IslandSchool of Design. Starbucks, Nike, 3M and IBM, are alsopart of this index.* DMI: Design Maturity Matrix provides a simple mapping tool tomeasure the maturity of design in any organisation (Microsoft)** S&P 500: American stock market index based on the marketcapitalisations of 500 large companies having common stocklisted on the NYSE or NASDAQ.The students conducted 30 primary research interviewsin French cities and at airports. These results allowedthem to create a questionnaire that they posted onsocial networks, and a total of 500 people throughoutEurope completed this online survey. The outcome ofthis qualitative study was eye-opening.The sample revealed that:77%of those interviewed had never set foot in atravel agency20%occasionally visited one with their parentswhen they were younger49%found travel inspiration primarily through theirsocial network32% found travel inspiration mostly from TV reports14% found travel inspiration mostly from websites6% found travel inspiration mostly from magazines57% planned and organised their trip primarily on travelwebsites, while 43% planned activities bybrowsing non-travel specific sites on the InternetAn important insight from this generation is thatthey don’t want to look at brochures filled withpretty pictures that don’t reflect reality – theyprefer to see pictures taken by real people liketheir peers.Source: The SDS

Research paper The Travel Retailer of the FutureBenchmarking current concept stores, not focusing solely on travelThe students came up with aninteresting matrix to comparevarious concept stores.On the emotional and physicalaxes are Hyundai Library (a librarydedicated to design in Seoul, SouthKorea, offering access to morethan 11,000 books chosen by aninternational team of curatorsand critics) and 't Japanse Winkeltje,(a store reflecting Japanese culture,with a bright, modern space andsubtle Japanese designs). Althoughthese are not travel companies,they are stores where you canimmerse yourself and feel as ifyou have been transported to adestination through their sensoryexperience.Colette, a renowned trendy fashionconcept store in Paris, excels atcurating special, high quality designproducts from around the worldand has managed to stay relevantand full of energy, since its debutin 1997. Colette offers a variety ofeclectic products such as beautyproducts, fashion, jewellery aswell as food and high tech items.Shopping addicts return frequentlyin order to follow these new trends.On the physical and informationalaxes, our design studentshighlighted Thomas Cook, whichfocuses on human interaction: itstravel consultants don’t just sitbehind their desk, they greet clientsand explore the store with them.Definingand creatingour personasFollowing their in-depth study, theSDS students created two personas:Victor and Chloé, our target travellers.Both are digital natives and are usedto shopping online.Here are their profiles:Victor is a 19-year-old who tends totravel with friends to places where hecan party in a group.Chloé is a 25-year-old who is already workingfull-time. She likes to travel with her best friend.She looks for adventure and is happy to delegatesome of her decisions to someone who can giveher good advice.On the digital and informationalaxes, Tailor Corner offers tailoredsuits and shirts at affordable highstreet prices. Customers can go tothe retail shops where expert salesconsultants advise them on theirchoice of suit using its own uniquesoftware. Consultants simply enterall the measurements via theapplication interface, and the clientscan then easily create their ownpersonalised suits directly in theshop or later from their laptop ormobile phones.This example perfectly illustratesthe blend of online and offlineservices.7

8The Travel Retailer of the Future Research paperA new travel experienceThe students created an experience map for Victor and Chloé, before, during and after travel, highlighting whichmedia they used for inspiration, such as social media, travel websites and/or travel guides.The designer of travel experiencesThe study also helped the students define a new kind of travel advisor:The TOM – aka Travel Organisation Manager, someone we could also refer to as a "designer of travelexperiences". He’s passionate, dedicated, reliable, friendly and hyper-connected. You can count on him to give youthe right advice as he’s from the same generation: of course, he is a digital native as well.The main insights of this study are that GenerationsY and Z want to be inspired, and informed as well ashave a full emotional experience. They want to be incontrol and have a variety of offers to choose from.They are hyper-connected digital natives but aremissing some of the human touch. As a result, ourteam of students believes that any solution shouldintegrate both digital and physical dimensions.

Research paper The Travel Retailer of the FutureKey findings andinnovative solutionsA travel constellation with four innovative concepts:Share & Go app, QUA, Take me Along van and IFTHEAThe solution is a constellation with all the stars gravitating around the Travel Organisation Manager (TOM) and the concept store.In the middle, you have the TOM from the agencynamed IFTHEA (If the Agency ).Around it, you have a mobile application calledShare & Go, which is the glue between the TOMand the travellers.Then comes the concept of a mobile inspiration space,which enables the potential travellers and their TOM tomeet up at different locations. For example, the TOMcould meet students at the library during their lunchbreak, at a coffee shop near their home, or at any otherlocation that is convenient for them.This concept is very interesting: Generations Y and Zare less likely to go shopping in the city centre, butthey go to parties at their friend’s house or study atuniversity. If they don’t go to the travel agency, perhapsthe travel agency can go to them.9

10The Travel Retailer of the Future Research paperShare & Go is the mobile application that links thetraveller and the TOM.It can be downloaded from the mobile inspirationspaces. You can chat with your TOM (face-to-face orvirtually) at every stage of your travel. To make thisapp stickier we’ll enable travellers to chat with othermembers of the community, finding new friends totravel with (the Meetic of travel?!). Travellers can postphotos and members can give each other advice.Once a certain level of advice and badges has beenearned, we could imagine that the customer mightbecome a TOM.

Research paper The Travel Retailer of the FutureIf digital natives don’t go to the travel agency,let the travel agency go to themQUA means "where" in Latin.The logo shows the picture of an inspiration bubblewith the connection symbol at the bottom. ImagineQUA as a tiny travel agency; it’s a solar-poweredcapsule that provides a virtual 360-degree experience,attracting your attention from the street thanks tointeractive screens on the outside. The QUA will belocated where students are, for example at a concert.The capsule can fit a maximum of two people and ismost suited to Chloé, who prefers to travel with herbest friend.Going further, you can schedule an appointment withyour Travel Organisation Manager (TOM), stayingconnected to continue the experience on the interactiveShare & Go app.11

12The Travel Retailer of the Future Research paperYour next trip starts right herePicture this: you’re at a big concert of an artist youreally like; as you step inside the immersive capsule,you discover interactive screens that will inspire you,help you gather information on your chosen destinationand even help you find out where and when the nextperformance will take place. You can even projectyourself and live a full immersive experience atdesignated destinations of your choosing.So, now that you have this information, all you needto do is connect to someone to help you organiseyour trip: just choose the Travel Organisation Manager(TOM) you feel the most affinity with and stayconnected to continue the experience on the interactiveShare & Go app.

Research paper The Travel Retailer of the FutureThe Take me Along van travels from a university tothe nearest train or bus station. As pictured on the logo,you’re embarking on an on-the-road journey.Students gather a group of friends, a maximum ofsix, and the van will take them on both a physicaland virtual journey. It’s more suitable for Victor, who’slooking to travel with a group of friends. Inside, theydiscover panoramic screens with different atmospheres.First, they’ll be asked to fill in a questionnaire (on screen),which will help determine their profile, the kind oftravellers they are, their preferences etc. The systemoffers different destinations based on their collectiveprofile; the whole van is synchronised to reflect thedestination.There’s information about the destination via varioussocial networks, as well as personalised screens. TheShare & Go app ensures they can continue to progresstheir travel plans with the agency’s TOM.Your travel starts here: Imagine you’re at universityand are waiting with your friends at the bus stop,when you see this van. You’re curious but need to getto the station. The van can take you there, so youdecide to use it. Inside, with your friends, you answera questionnaire that defines which destinations bestmatch your profiles.The quiz shows that Africa is a great destination foryou all. During your journey to the station the screensdisplay pictures of Africa, moving at the same pace asthe van. You can smell scents that project you into anAfrican safari. It’s as if you’re already there.After this remarkable experience, you arrive at thestation and are brought back to reality (grey sky, smellycity ). That’s when you really need someone to talk to,to help you get going with your travel plans: you canstay connected via the mobile app with your agencybuddy, the TOM!13

14The Travel Retailer of the Future Research paperImagine a new agency experience starting themoment you walk into the store, with interactivescreens displaying different destinations. It’s as thoughyou’re walking on the beach in Hawaii, snorkelling inAustralia or skiing in the Alps. Sounds tempting, right?At the entrance of IFTHEA, you even have video portals(you see three of them on the wall in the picture below)that allow you to chat with people in different parts ofthe world; for instance, to a TOM in another country orto a group of travellers currently on an elephant trek,simply by using a webcam.Within the store, you’ll find sitting areas, withhammocks for instance, and discover an interactiveand sensory library which mixes sight, smell and touchto engage customers in a fun way. With interactivescreens, you can share photos and organise yourjourney with your friends and your TOM, all in a cosymeeting place with coffee or fresh juice.What’s more, just like in the van, why not choose yourfavourite destination as a group, using the tablet. Youcan even find extra travellers that share your intereststo join you on your trip.Like some well-known coffee shops, IFTHEA offers aplace where people can relax, meet others, hang out,read books, or even work. There’s nothing worse thanan empty place, people attract people!In this cosy area, you can discuss your travel with theTOM, who will have access to various ideas on an iPadand will search for the best possible trip.

Research paper The Travel Retailer of the Future15Travel Retailer of the Future,and beyondImagination doesn’t stop here andmore innovations are already inmotion. For example, we’d like tointroduce you to 1A-TA, our ownversion of C-3PO. He’s actually aPepper humanoid robot designedspecifically by Softbank Roboticsto interact with human beings.For our first experiment, weprogrammed him to break theice with customers in a travelagency and start collectinginformation on their preferences.1A-TA is able to read andunderstand people's reactions,allowing him to collect valuableinsights for the travel agent.Our little assistant can not onlyengage in conversation but alsoshow photos related to destinationssuch as landscapes, local foods, allkinds of photographs that can helpinspire customers and qualify theirneeds. Our deep learning algorithmprocesses the information beforepassing it on to the TOM who cannow better target their offers.Amadeus is evaluatingtechnologies, which may havea huge relevance for tourismand travel in the near future.Pascale CARONAssociate Director - Global Consulting & Pre-Sales, AmadeusFor instance, the HoloLenstechnology from Microsoft, couldenable you to view the inside of aplane to choose your seat thanksto mixed reality smart glasses. Inhospitality, the Oculus technology,could virtually put you inside ahotel room to get a feel for it priorto booking.

16The Travel Retailer of the Future Research paperConclusionThe consumer journey is on the brink of momentouschange. Today’s travellers expect answers that arefaster and more relevant to their immediate needs,and they expect to receive them during the whole travelcycle. The travel market itself has changed, shapedby the digital revolution, with innovative technologies,such as chatbots and Artificial Intelligence, already partof people’s lives. In such a fast evolving world, manyplayers could be at a crossroads.So how can traditional travel retailers adapt to newrealities and newer generations to stay relevant tothe travellers of tomorrow?Travel retailers now need to rethink their business, tore-invent themselves. They must engage with youngergenerations in a way that appeals to their lifestyle,and do so throughout the entire travel cycle – frominspiration, planning, during the journey and after it’sover – and with a truly collaborative approach.All of this may sound very futuristic, but at Amadeuswe believe that the best way to predict the future is tosimply create it, so we’re ready to step in and shapethe future of travel together.

Research paper The Travel Retailer of the FutureAbout The SDSLocated in the Plaine du Var eco-valley, between Niceand Sophia Antipolis, The Sustainable Design Schoolis an international graduate school of design andsustainable innovation at the service of Man. The SDSis also a member of UCA (Université Côte d’Azur), acommunity of Universities and Institutions.The school is a member of the international networkCUMULUS Association, involving 280 higher educationinstitutions and design universities across the world.Today, the SDS is part of exchange programmes withChina, India, Italy, Canada, Japan, Turkey, Georgia, Chili,Peru, Argentina and the USA.The SDS has a 5 year Masters programme (calledLMD), in Design and Sustainable Innovation, anda 3-year PhD Doctorate Degree in Research andSustainable Design,The Sustainable Design School is the founder of theFab’Azur Fablab and a partner of TEDxCannes.The school was founded by two designers and arenowned naval architect: Patrick le Quément, MaurilleLarivière and Marc Van Peteghem.The SDS follows a “teaching by doing” approach mixedwith a blend of competencies and cultures. Designand Sustainable Development projects are presentedto the students by large partner companies such as:Amadeus, Accenture, Air Liquide, BMW, Carrefour, CréditAgricole, Hermès, Michelin, Orange Business Services,L’Oréal, Renault, Sita Suez-Environnement, SchneiderElectric, Steelcase and Toyota to name but a few.The school also offers training in innovation methodsand design subjects (e.g. Design Thinking, FrugalInnovation, Open Innovation, Social Innovation).17

18The Travel Retailer of the Future Research paperAbout AmadeusWe all share the need to explore our world; to see newplaces, meet new people or be near what’s importantto us. Travel builds economies, broadens culture andcreates connections between societies. Travel powersprogress.Amadeus powers travel. Amadeus’ solutions connecttravellers to the journeys they want through travelagents, search engines, tour operators, airlines, airports,hotels, cars and railways.Technology has always been critical to developingglobal travel, increasing scale and access. Mobiledevices, artificial intelligence and data analytics arecontinuing that evolution, giving people ever moreideas, options and control over their journey.Amadeus moves with these changes. We havedeveloped our technology in partnership with thetravel industry for 30 years. We combine a deepunderstanding of how people travel with the abilityto design and deliver the most complex, trusted,critical systems our customers need.We develop technology every day, harnessingintelligent use of data, integrating new devices andarchitectures to deliver personalised and integratedjourneys. Our technology ensures transparency, choiceand simplicity for travellers and gives our customersthe tools to drive growth and efficiency.We are one company with a global mindset and a localpresence wherever our customers need us. We helpconnect over 1.5 billion people a year to local travelproviders in over 190 countries. We are open in how wework, innovating and collaborating with customers andpartners to move fast, deliver on new possibilities andsolve problems.Our purpose is to shape the future of travel.We are passionate in our pursuit of better technologythat makes better journeys. We are committed tousing technology to help global travel have a positiveimpact on communities and grow sustainably aroundthe world.We will succeed by working with our customers to helpeveryone shape their own journeys, creating value forcustomers, travellers and society.

Research paper The Travel Retailer of the FutureNotes19

2017 Amadeus IT Group SAYou can follow us on:AmadeusITGroupshapethefutureoftravel.com

14% found travel inspiration mostly from websites 6% found travel inspiration mostly from magazines 57% planned and organised their trip primarily on travel websites, while 43% planned activities by An important insight from this generation is that they don't want to look at brochures filled with

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