Arnie Weissmann
The late Illinois Sen. Everett Dirksen claimed he never actually said, "A billion here, a billion there, pretty soon you're talking real money," but he wished he had. He said he was misquoted but that it sounded so good he usually didn't bother denying the attribution.
Even though Dirksen died in 1969, and a billion dollars ain't what it used to be, the $70 billion invested in the travel industry last year by venture capital and private equity firms is a significant sum of money. And among those deciding which companies receive a portion of those funds is Thayer Ventures, which invests exclusively in travel technology initiatives.
I attended its annual meeting in San Francisco earlier this month and listened to a series of speakers, including senior executives from Google, Microsoft, Marriott and Uber, address topics that ranged from artificial intelligence and Big Data to autonomous vehicles and virtual and augmented reality.
It was clear that a portion of the $70 billion will facilitate the future application of these technologies in travel, but one of the speakers anchored his discussion firmly in the present tense, challenging current assumptions and seeking to dispel myths he believes misguide development.
Alex Dichter, the director of global travel for the consulting firm McKinsey & Co., pointed out that new technologies often prove that common wisdom can morph, over time, into commonly accepted myths.
For example, hotel brands built on replicable brand standards seemed to suggest the supremacy of consistent delivery. But the success of Airbnb suggests otherwise.
Similarly, Uber killed the myth that private ground transportations -- taxis and car services -- had limited growth opportunities because they were only used infrequently by most consumers.
Dichter questioned the current obsession with courting millennials.
"Mathematically, it's true that within 50 years, they will be important," he allowed. "But they're just not as interesting a demographic as we think they are. Hipsters are building technology for hipsters but are missing an important opportunity: their parents."
Dichter believes that growth in travel will be driven by baby boomers until 2030, calling them "the most interesting demographic the travel industry has ever seen, with the time, money and interest to travel."
Switching topics, he went on to provide guidance to upscale hoteliers struggling to balance the need for high-touch service with technology. The question, he implied, might not be so much about technology vs. human service as taking note of changes in attitudes regarding how quickly people can get what they want.
"The trend is toward having an espresso machine in the room rather than calling down to room service," he said. Similarly, "in airline lounges, business-class passengers have traditionally been offered a buffet while first-class passengers have seated service. But now first-class passengers are migrating to the business-class buffets."
I would add that, at the luxe level, it's not only about instant gratification. Coffeemakers have been in Motel 6 rooms for decades. But an espresso machine, with a selection of pods of varying roasts and blends, adds cache. Similarly, if food in the business-class lounge wasn't appreciatively better than Sizzler's all-you-can-eat buffet, first-class passengers would practice the virtue of patience and retreat to their white linen tables.
The last myth he attacked was that "search is about breadth." In other words, the more options returned, the more likely a searcher will find what she or he is looking for. He turned to art gallery sales to bolster his argument against exhaustive supplies of inventory.
"Every gallery owner knows you never show a prospective buyer more than four paintings," he said, perhaps a well-known artist, an obscure newcomer and two somewhere in between. The buyer mulls the choices, but gallery owners know more sales are ultimately closed if, rather than telling clients they're going to like a specific painting, they instead tell them which painting they like.
"You have to help people assign value," Dichter said.
The overused term "curation" came from the art world, and it's worth pondering the implications of this example. To assign value, the buyer has to trust the seller's judgement. But just as calling oneself an artist doesn't mean the art one produces is good, likewise proclaiming oneself a curator doesn't automatically convey trust in judgment.
As this was a technology-focused forum, it made me wonder whether a website could build a trusted model of curation. Despite the advantages that Big Data insights have given OTAs, they nonetheless struggle with loyalty. A human adviser can say, effectively, "I like this safari," but can a machine?
I think the answer is "maybe," and I'm surprised we haven't seen a personality-branded OTA take off. There are known personalities who have loyal, trusting followers and whose reputations and opinions could drive purchases. And there are lesser-knowns -- perhaps current travel retailers -- who have the experience, credentials and the personality to break out.
An OTA site that leverages personality-driven sales on a large scale, amplifying what a trusted travel adviser does on a small scale, could be interesting. If someone can peel away a bit of that $70 billion to launch a site truly curated by a trusted individual, I believe that pretty soon -- to misquote Sen. Dirksen -- "you're talking real money."