Asian travel brands have plenty of room to grow sales of ancillaries by presenting customers with personalized offers.
A report prepared by SapientRazorfish in the lead-up to Digital Travel Asia shows that while the share of revenue generated from ancillaries is modest.
- 61% of those surveyed said ancillary sales represent 20% or less of their sales revenue.
- Only 1% of those surveyed said it represents 60% or more of their sales revenue.
But 83% of Asian travel brands said they expect an increase in ancillary sales over the next twelve months and only 17% said they expected ancillary sales to decrease.
Seton Vermaak, travel & hospitality lead SEA at SapientRazorfish says:
“Such is a sphere that may be further bolstered as travel brands compete directly with OTAs, facilitating a relationship that affords direct sales for a range of travel products and services. This new model also has huge implications for data analytics capabilities—for both customer-facing insights and better supply chain management.
“Ancillary sales are about more than just face value revenue generation: they present a utility that heightens the end-to-end experience for travelers. These types of suggestions allow brands to showcase how well they know a traveller, to foster a relationship by showing an understanding of their need for convenience.
“This is an important driver for the new loyalty offering expected by today’s traveller. More than this, though, ancillary sales provide even more data—more information to share with strategic partners and to feed back into better understanding a customer.”
Travel brands listed data analytics which could be applied to personalization as a high priority for the coming year, which would allow them to present customers more appealing products, services, and experiences.