The travel industry in South-east Asia has come a long way since a decade ago. Traveloka was founded to solve the fundamental problem of flight discovery and booking present in Indonesia.
Access to travel alternatives and experiences across the region was also a challenge then. Trips were planned based on word of mouth or reliance on tour operators, focused on classic experiences – visiting Borobudur in Indonesia, swimming in Phi Phi Islands, sightseeing atop the Petronas Towers, cruising along Halong Bay, and cable car dining in Singapore. There was no transparency in flight options or pricing, so oftentimes, consumers are at the mercy of the travel consultant. This gap got us to build a platform that simplifies the painful process of travel booking across South-east Asia.
The next big challenge was financial access. At least 24 per cent of the population in South-east Asia is estimated to be ‘underbanked’. Due to the structural challenges in Indonesia and other parts of South-east Asia, it has been historically difficult to verify creditworthiness, with credit card penetration remaining at 10 per cent or less in Thailand, Indonesia and Vietnam.
Built on the foundation of deep customer trust and data from our beginnings in the travel business, we launched a number of financial services products, including pioneering Buy Now, Pay Later (BNPL) in Indonesia, and later two more products on the back of strong demand, making it easier for customers to enjoy these experiences.
As we move into travel recovery post-pandemic, the next frontier of travel will focus on leveraging technology to bridge the rift between the expectations and reality of travel.
Connected to disconnect
Travel is making a strong comeback. Airports and airlines alike are increasingly confident that they have reached a turning point in their financial recovery. Since the start of the year, travellers are quickly booking their next trips to fulfil their pent-up demand. As more countries fully reopen their borders, dropping all need for pre-departure and on-arrival tests, as well as quarantine requirements for the fully vaccinated, those looking to satisfy their wanderlust are increasingly encountering the nightmare of surging fares, alongside varying levels of concern and hesitance – from the virus to safety.
In order for travel to pick up and make a triumphant return to pre-pandemic levels, the purposeful deployment of technology will be key. Obviously, technology has been embedded in society now and has brought about many conveniences. Even the tourism industry, which has traditionally not been the most tech-connected industry, has stepped up to embrace digitalisation. For example, Changi Airport is making a concerted effort to make tech work harder for travellers, bringing contactless services to the next level. Self-check-in kiosks and baggage drops now operate when a person hovers their finger over a screen, and passengers can use automated immigration gates that scan faces and irises if those biometrics are registered in a passport.
The travellers of today want more holistic and personalised travel experiences. They are digitally engaged, and these connected consumers are expecting a better experience than ever before. The connected consumer is looking for instant gratification, everything and anything should be at their fingertips. If consumers can spend all their time looking at their phones; making comparisons before purchasing the products and/or services, all done on a single platform, fuss-free; travel should be no different. From the moment the individual thinks of taking a trip, to when they return safely to the comfort of their own homes, the new connected travel experience is the way to go.
The reality of travel
In actuality, the market for travel and local services continues to be highly fragmented in South-east Asia. There is a disparity between what discerning middle-class consumers expect, and what service providers can currently deliver. Technology can help to mitigate this problem by helping providers to better understand consumer preferences, and enabling them to create the experiences that they want – this is where the idea of a superapp comes to play.
Superapps need to understand the gaps and unique pain points that customers in each of their markets face, and then solve them. Strong data analytics capabilities are critical in understanding the different needs of consumers across the region, and to tailor and localise products and services accordingly is critical to ensuring success across geographies. Data insights will also play an important role in helping companies to meet and anticipate the future needs of consumers – particularly within the context of structural challenges across South-east Asia.
With this, superapps will connect providers and consumers, channelling feedback and guiding providers to improve their quality of service, which, in turn, establishes superior consumer experiences and gains better traction. Ultimately, with the speed of technological innovation, it is important that we establish clear principles for who we want to be as a global community, and that this is reflected in the technology we develop, and how it is implemented.
Technology must be used to build an equitable world
As we have seen, technology plays an important role in addressing the structural challenges in South-east Asia, such as financial inclusion and access to essential services. It will bring unprecedented opportunities to create greater equity and a better future for millions. But it is also clear that we need to ensure technology is building an equitable future for all; that all people and societies – from developed to emerging economies – are benefitting.
The pace of digitalisation will continue to accelerate and transform how we travel, connect, and live. Greater digitalisation will provide stronger data insights into the unique behaviours of South-east Asian consumers, and lifestyle services will become less fragmented as a result. We expect this to transform the customer experience, by necessitating personalisation never before seen in the world, in turn retaining and attracting customers.