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Chat, Shop, Buy: Messaging as the New Traveler Medium Researched and written by Douglas Quinby April 2016 A new report of the rise of messaging in travel from Phocuswright, the travel industry research authority

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Page 1: Phocuswright chat shop buy executive summary_4.29.16

Chat, Shop, Buy: Messaging as the New Traveler Medium

Researched and written by Douglas Quinby

April 2016

A new report of the rise of messaging in travel from

Phocuswright, the travel industry research authority

Page 2: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 2

About Phocuswright

Phocuswright is the travel industry research authority on how travelers,

suppliers and intermediaries connect.

Independent, rigorous and unbiased, Phocuswright delivers qualitative and

quantitative research on the evolving dynamics that influence travel,

tourism and hospitality distribution. Our marketplace intelligence is the

industry standard for segmentation, sizing, forecasting, trends, analysis and

consumer travel planning behavior. Every day around the world, senior

executives, marketers, strategists and research professionals from all

segments of the industry value chain use Phocuswright research for

competitive advantage.

The company is headquartered in the United States with Asia Pacific

operations based in India and local analysts on five continents.

Phocuswright is a wholly owned subsidiary of Northstar Travel Media, LLC.

Page 3: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 3

Copyright

All Phocuswright Inc. publications are protected by copyright. It is illegal

under U.S. federal law (17USC101 et seq.) to copy, fax or electronically

distribute copyrighted material without explicit permission. You may not

copy, reproduce, modify, republish, upload, post, transmit or distribute,

electronically or otherwise, any Phocuswright research report in any form or

by any means without prior written permission from Phocuswright Inc. Any

unauthorized use of the materials may violate copyright, trademark, and

other applicable laws and could result in criminal or civil penalties.

© Phocuswright

Page 4: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 4

The Rise of Messaging

1. https://blog.whatsapp.com/616/One-billion

2. http://newsroom.fb.com/news/2016/01/heres-to-2016-with-messenger/

3. http://www.statista.com/statistics/255778/number-of-active-wechat-messenger-accounts/

4. http://techcrunch.com/2016/02/02/what-is-this-a-gif-for-brands/?ncid=rss

5. Snapchat users June 2015: http://www.adweek.com/socialtimes/snapchat-is-the-fastest-growing-social-network-infographic/624116

The growth of mobile messaging has been

remarkable, and certainly undeniable. In

addition to the widespread use of traditional

SMS or text messaging, Internet-based mobile

chat apps have become default means of

communication among billions around the

world. According to Internet Trends 2015

from Mary Meeker of Kleiner Perkins Caufield

Byers, six of the 10 most used mobile apps

worldwide are messaging apps.

1 billion use WhatsApp1

800 million

use Facebook Messenger2

700 million use WeChat (Weixin) 3

275 million use kik4

200 million use Snapchat5

Chat Apps & Their Users

Messaging is also evolving rapidly. While mobile

chat apps emerged as free, Internet-based

alternatives to comparatively expensive text

messaging, numerous apps have introduced

a range of innovative features and functionality

to include pictures and video, commerce, brand

marketing, customer engagement and more.

Page 5: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 5

From Messaging to Medium More Than Just Chat

Image: WeChat

*Connie Chan, “When One App Rules Them All: The Case of WeChat and Mobile in China” (August 6, 2015).

Source: Phocuswright’s Chat, Shop, Buy: Messaging as the New Traveler Medium

Perhaps the most cited example of chat moving

beyond just messaging is China’s Weixin, or

WeChat. Its growth in China has been particularly

remarkable. The widely popular app has evolved

as much into an ecosystem* for commerce,

payments and other services, and is widely hailed

as a model for what the future of messaging apps

could become in the U.S., Europe and elsewhere.

WeChat enables third parties to build applications

and services within its platform, a model that

others, such as Facebook Messenger, are also

pursuing. The most robust apps are becoming

operating systems within the dominant mobile

platforms of Apple and Android.

The results view of China

Southern’s voice recognition

flight search within WeChat

Page 6: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 6

Source: Phocuswright’s Chat, Shop, Buy: Messaging as the New Traveler Medium

Chat, Shop, Buy: Messaging as the New Traveler Medium

This report examines the rise of messaging and the opportunity

for travel brands to leverage chat-based services for customer

engagement. Phocuswright’s Chat, Shop Buy addresses the following:

• The use of text and messaging apps among U.S. travelers;

• The growing ecosystem of chat-based travel planning services;

• The target traveler segments for chat-based travel planners and

the challenges in winning them over;

• The use of chat in hospitality for guest service and engagement;

• The role of bots, artificial intelligence and people in powering chat;

• The future of chat and how it will – and will not – impact travel.

Page 7: Phocuswright chat shop buy executive summary_4.29.16

Terms and Methodology

This study focuses on mobile messaging, including

text messaging (SMS) and Internet-based instant

messaging services for mobile devices. This report

uses “messaging” and “chat” interchangeably to

refer to Internet-based mobile apps for instant

messaging. It does not directly address all forms of

messaging, such as in-app and mobile OS push

notifications, email and other asynchronous

communication services.

Chat, Shop, Buy includes new consumer research

of 1,904 U.S. travelers on their use of messaging,

based on Phocuswright’s U.S. Traveler Technology

Survey 2015. Phocuswright also conducted interviews

across a range of startups offering messaging

services within travel, as well as established travel

companies introducing chat-based services.

Source: Phocuswright’s Chat, Shop, Buy: Messaging as the New Traveler Medium

© 2016 Phocuswright Inc. All Rights Reserved. 7

Page 8: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 8

What’s Covered in Chat, Shop, Buy: 1. The Rise of Messaging

2. U.S. Travelers & Chat

3. Chat, Shop, Buy

• Four Key Themes Behind

Chat-based Travel Planners

• Will Travelers Chat?

(And if so, Which Ones?)

• The Frequent Traveler

Challenge

• Ten Chat-based Travel

Planner Startups

4. The Guest Experience:

Getting the Message

• Hotel Help via Chat

• The Hotel-Guest Messaging

Startup Ecosystem

• Guest Requests: What They’re

Chatting About

5. The Next Message

• AI, or Scaling Humans

• Beyond the Message

• How Chat Will – and Will Not -

Change Travel

• Further Reading

Page 9: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 9

Charts Included in Chat, Shop, Buy: Figure 1: Traveler Use of Media for Sharing Trip Experiences

Figure 2: Traveler Use of Media for Sharing Trip Experiences by Age

Figure 3: Traveler Use of Messaging Apps

Figure 4: Traveler Use of Messaging Apps by Age and Income

Figure 5: How Travelers Approach Trip Planning

Figure 6: Annual Trip Frequency of U.S. Travelers

Figure 7: How Travelers Approach Trip Planning, by Trip Frequency

Figure 8: Nine Chat-Based Travel Planner Startups

Figure 9: How Hotel Guests Use Messaging (Checkmate)

Figure 10: How Hotel Guests Use Messaging (GoMoment)

Page 10: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 10

Startups Discussed in Chat, Shop, Buy:

Hotel-Guest Messaging

Alice

Checkmate

GoMoment

GuestDriven

Kipsu

Moncierge

Whistle

Zingle

Chat-Based Travel Planners

30SecondsToFly

Assist

Emma

ETA

GoButler

HelloGbye

Hyper

Lola

Operator

Pana

Scout

Page 11: Phocuswright chat shop buy executive summary_4.29.16

U.S. Travelers & Chat

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© 2016 Phocuswright Inc. All Rights Reserved. 12

Source: Phocuswright’s Chat, Shop, Buy: Messaging as the New Traveler Medium

Messaging & Travel

With the growing popularity of

chat apps, traveler use of mobile

messaging has risen dramatically,

and the impact on travel – from

shop and book to experience and

share – will only grow. Nearly

half of U.S. travelers used text

messaging and more than three in

10 used chat apps to share their

travel experiences in 2015

(see Figure 1, next slide), up

significantly from previous years.

Page 13: Phocuswright chat shop buy executive summary_4.29.16

© 2016 Phocuswright Inc. All Rights Reserved. 13

Figure 1: Traveler Use of Media for Sharing Trip Experiences

* Messaging apps not asked in 2012 and 2013.

Base: U.S. Online Travelers (N=1,904)

Source: Phocuswright’s U.S. Traveler Technology Survey 2015

0% 10% 20% 30% 40% 50% 60%

2012 2013 2014 2015

Text Messaging

Email

Messaging apps*

2015 saw a

big jump in

traveler use

of text and

mobile

messaging.

Page 14: Phocuswright chat shop buy executive summary_4.29.16

Read more from

Chat, Shop, Buy:

Messaging as the New Traveler

Medium

Get the full report here.

Researched and written by Douglas Quinby

April 2016

Phocuswright Inc.