Digital Transformation Project: Typ Agency
The introduction of the Internet has not only changed whole travel experiences, but it has also turned the entire travel industry upside down, as new companies emerged to take advantage of the internet as a distribution channel, while many existing players were left struggling to keep up with “going online”. For our Digital Transformation Project we decided to analyse one of the “old” players, a Czech travel agency with more that 23 years of history: Typ Agency. With the Internet crawling with competition, Typ Agency is aware that a change is needed in order to remain competitive and attract more clients.
In our report we analyze different ways in which Typ Agency could embrace technology in order to improve its leisure traveler base – until now it was mostly focused on the business travel side of the Czech travel industry. The first option considered focuses on the development of a mobile application that would allow leisure travellers to browse travel deals and book flights, hotels and other travel products offered by Typ Agency. The second one is the social media option, in which the travel agency will sell its travel products through social media channels. As a third option, a null option was considered, but this option has been discarded, as a move into current technologies will be needed to stay competitive in the future.
After considering multiple KPI’s and a cost benefit analysis, we have chosen to implement the social media option. By implementing this option we expect that the premium service Typ agency currently offers mainly to its business clients and 24/7 crisis resolution, will lead to trading out behavior among leisure travelers seeking premium service as well, and thus choosing Typ Agency over cheaper offers with a lower provided service (Li, Kauffman, van Heck, Vervest & Dellaert, 2014).
With a social media presence (to start with on Facebook and Twitter), we expect to create a customer want to travel and to motivate them to book quickly, without having had the intention to go travelling when starting to use the social media platform (Bennett, 2012). The Facebook Buy Button, which will allow Typ Agency to start selling their B2C travel directly through Facebook, will be implemented as well. Another technology Typ Agency will use is auctioning travel bundles through social media. This is possible on Facebook with BuddyBid. Auctions in fact tend to create excitement and competitiveness among customers and this can lead them to spend more money on a bid than they would usually be willing to pay (Adam, Krämer & Müller, 2015).
The main benefit of the social media option is the relatively small investment required for implementation. Typ Agency could increase sales in the B2C travel sector, without having to incur big development costs. Another benefit is that the social media strategy can be started quickly: it is expected that Typ Agency will be able to use social media platforms to interact with customers and to advertise offers within approximately four to six months.
As mentioned before, currently Typ Agency does not have the capacity to interact properly with its leisure travel clients, as they are focusing more on the business travel side of the Czech travel industry. Therefore this social media strategy seems to be the best opportunity to move forward into new technologies and attract new leisure travellers, without compromising the service level for B2B customers.
Li, T., Kauffman, R., van Heck, E., Vervest, P., & Dellaert, B. (2014). Consumer Informedness and Firm Information Strategy. Information Systems Research, 25(2), 345-366.
Bennett, S. (2012). Social Media’s Influence On The Travel Industry [INFOGRAPHIC]. Adweek.com. Retrieved 2 October 2015, from http://www.adweek.com/socialtimes/online-travel-industry/467349
Adam, M., KrÄmer, J., & Müller, M. (2015). Auction Fever! How Time Pressure and Social Competition Affect Bidders Arousal and Bids in Retail Auctions. Journal Of Retailing, 91(3), 468-485.
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