The Role of Online Travel Agents in the Experience Economy

Anton Bogdanovychanton@it.uts.edu.au

University of Technology Sydney

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Outline

• Experience Economy

• Motivation Tourism

• Why Online Travel Agents?

• Motivation 3D Virtual Worlds

• 3D Electronic Institutions

• The World Trotter Travel Agency

• Conclusion

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Experience Economy

• In the emerging experience economy, the experiential component of a product or service is increasingly the basis of profit.

• “Just as people have cut back on goods to spend more money on services, now they also scrutinize the time and money they spend on services to make way for the more memorable—and more highly valued—experiences” (Pine and Gilmore, 1999, p.12).

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Features of the Travel Product

• Tourism product is intangible in nature. (Jackson, 1997). For this reason, tourists need to get as much correct information as they can feel confident that their desires and expectations will be fulfilled.

• It is remote in nature with the person selling a product possibly never having seen the destination sold and yet being the prime source of advice (Jackson, 1997). This has a consequence that the collective intelligence is required to provide customers with correct information about the trip.

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Features of the Travel Product• The description of a product is always subjective

(somebody’s perspective) and background related (Gee et. al, 1997). This suggests that the more real is the travel product presentation the less uncertain is the customer about its characteristics.

• The product is delivered by many different firms, which are typically different in terms of their functions and capabilities (Palmer & Bejou, 1995). For the customer this means that the more components are present in the desired package, the harder it is to order the package without help from travel intermediaries.

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Features of the Travel Product• Few other industries link so many diverse and

different kinds of products and services as the tourism industry (Edgell 1990, p.7). The list of all travel-oriented “commodities” is too large, so a catalogue is not feasible to produce (Rugg, 1973).

• The travellers of today decide to buy or not to buy depending on the quality of experience they receive during the trip selection (Yeoman et. al. 2005).

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Motivations of travelers• sense of power (visitors demanding service and attention)

• search for romance

• desire for cultural exchange

• need for leisure/escape

• desire of social contact

• following social trends

• change from routine to new experiences,

• satisfying curiosity and personal values (i.e. trips to places of religious significance)

• Involvement with the booking experience

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Destination characteristics• scenic beauty of a place• pleasant attributes of the local people• destination visitor image vs actual self-image and

ideal self-image• suitable accommodations• rest• relaxation• airfare

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Consequences Summary• Engaging experience is important

• Need as much Information as possible

• Objective representation of information

• Collective Intelligence is required

• Reduction of the package complexity

• Human expertise

• Social factors

• Self image recognition – user preferences

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• Expertise of the travel agents

• Impulse decisions

• Group booking

• Social interactions

• Loyalty

• Travellers value that their preferences are remembered

Travel Agents pros

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• Convenience

• Comfort of the familiar home environment

• Fast responses

• Multitasking

Online booking pros

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Motivation 3D Virtual Worlds

• Has more residents than Miami

• Has bigger GNP per capita than Bulgaria

Norrath, The online world created by Sony

Virtual worlds are one of a few online businesses that make money on the Web

Edward Castronova, USA, 2003

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3D Electronic Institutions

Electronic Institutions•Structured Interactions•Secure•Strong methodology•Guarantees that participants adhere to the institutional rules and fulfill the obligations

3D Electronic Institutions•Social•Secure•Structured Interactions

3D Virtual Worlds•Social & entertaining•Fully observable•High User Involvement•Impulse travelers •Not structured interactions

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Methodology

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Vision

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Runtime Architecture

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“World Trotter” Travel Agency

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“World Trotter” Travel AgencyBooking and destination search

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“World Trotter” Travel AgencyHotel Visualization Service

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“World Trotter” Travel AgencyDestination Visualization Service

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“World Trotter” Travel AgencyDestination Visualization Service

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“World Trotter” Travel AgencyShop Service

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Conclusion

Online travel agents are the most promising travel provider for the experience economy

We propose 3D Electronic Institutions technology to be utilized for the implementation of online travel agents

The World Trotter Travel Agency demonstrates our vision of how this technology can be employed

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Conclusion

The World Trotter Travel Agency– provides immersive 3D visualization– allows interaction with tourism products– facilitates implicit training of assistants– supports group booking– provides the grounds for a lively tourism

community– fosters social interaction and the exchange of

personal experiences