- 5 months ago
Personalised trips, predictive insights, and smarter bookings. Trip.com leaders Schubert Lou and Edmund Ong share how AI is transforming travel as we know it.
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00:00Planning a holiday has never been easier. AI can design your itinerary, pick the perfect
00:17stay and book your flights instantly. But if technology is taking over the planning of your
00:23travel, what role is left for online travel platforms? So that is what we'll be discussing
00:28today and I'm really excited. Joining me on this episode we have Shubert Lu, he's the CEO of Trip.com
00:36and next to him we have Mr. Edmund On, he's the Senior Regional Director for Southeast Asia at
00:42Trip.com. Great to have you both here. So going back to my question earlier, if Google or ChatGPT
00:51can help me plan a perfect itinerary in seconds, what's left for OTAs like Trip.com? What is the
00:58role of a company like yours? Absolutely, that's a great question. So to start, planning is not the
01:04only piece of travel. We all agree with that. Planning is just a small bit of it. It may be a
01:09very time-consuming bit of it and AI is doing a good job to do it, but our platform what we can do is
01:16an entire ecosystem of travel. So we start from what we call the inspiration phase of travel into the
01:22actual planning into the actual booking into the fulfillment of the travel and the customer service
01:28behind it. So this ecosystem is what we offer on top of just AI planning. So the short answer back to
01:36your question is, yeah it does a bit of the job better, but overall we are incorporating that and
01:42understanding how AI can work and our booking can work together and solve the problem for our consumers.
01:48Okay, so let's get to how you are incorporating AI into your platform and how has it improved customer
01:54experience? Absolutely, so a few fold. One is we actually integrate some of our technology with the
02:00bigger search models out there. We integrate our solutions into theirs, so once you search in their
02:06platform you get routed to our travel services. The other is we have our own version of the AI we call
02:13Trip Genie that's in our apps right now where you can do detail planning and also the features more
02:19comprehensive, more error-proof in terms of accuracy, in terms of where you can go and what is the lag,
02:27what are the possible routes and so on. And once you have that, then you can actually book it. So that's
02:33the big difference between the traditional AI planner and a Trip Genie-enabled AI solution. Okay, so from what I
02:41have read, I have read Trip Genie usage jump about 200% last year. What is driving that search? I'd like
02:48to go to admin just to try to understand a bit more of, let's focus in on Southeast Asia especially.
02:54Right, right. Is this just curiosity of, no, I'm wanting to try AI or is AI really changing travel behavior among
03:00countries? I think it's really changing the way that how customers actually use AI to just do searching for
03:10their travel products. I think right now Trip Genie actually covers about more than 200 countries.
03:17But what is interesting to me is how, especially in this region, how different countries actually behave,
03:26the user behave. Take for example, Singaporeans, they love to use AI, a Trip Genie in this sense,
03:34to search for after hotel sales service, such as confirmation. They view it as a very effective
03:42efficiency tool. But whereas in Malaysia, Malaysians will use the hotel comparison in their research,
03:52right, to compare certain pricing. And this probably is how Malaysians use AI to, you know,
04:01to give them the best value for their money when it comes to booking hotels. I think Malaysians' intent
04:10of using that function itself is 2.5 times higher than the global average in terms of hotel pricing comparison.
04:18Okay, so that's the customer experience, right? But I do wonder, the usage of AI as a company
04:24operations-wise, right? How does that then translate into better efficiency or even revenue, cost savings,
04:32even? AI right now is infiltrating a lot of part of our product and our operation. Let's start with the
04:38product side. We have Trip Genie, which we talked about being a one-stop shop and able to book. We're also
04:45enabling other features on our site in terms of hyper-personalization, meaning that I know you,
04:51I know all the conversations you had with the platform, all the history, and all the type of
04:57booking you had. And we give that all to AI to give you the best recommendation we can. In the past,
05:04it was just your search criteria. Now is your history, your conversation, and all about you and
05:09give you something that you like. And then we're also using that in other technology, including,
05:14we call it Trip Trends, and we call it Trip Events. These are also tailored to you on what would you
05:22like in terms of what is happening around the world and what would be the best for our consumer. So it's
05:27infiltrating into all the different type of products. Just looking ahead, I'm just wondering,
05:32so let's say 10 years from now, right, will AI still recommend trips to you or it will tell you,
05:38this is what you need, this is what you want. Okay, so we're talking about that industry called ASI,
05:43right, artificial super intelligence. So in that world, it's prediction model, meaning that it will
05:50know you better than you do yourself. So you will actually tell you and recommend to you something that
05:56you should do. So I think that will be probably five to 10 years from now. And if that happens, then
06:03we truly have someone, there'll be a speaker that you just talked to, your interaction is no longer
06:08screen, you would just say, where should I go next week with my family? And it will give you all the
06:14resolution and then say, can I book for you? And you say yes, you will be done, right? So your travel
06:19becomes so seamless, that will be the future. Do you see your competition, the next stage of competition?
06:26Will it be from your other competitors? Or would it be an AI platform or a, I don't know, a social
06:33media platform that thinks, hey, maybe I want to get to travel? Interesting. I think the answer will be
06:39multi-fold. One is the entire industry is changing already. I think all our competitors and ourselves
06:46are looking into the AI solutions and how can that make our travel better. Then we're looking into
06:52other venues. So getting back to that multi-modal interaction. In the past, it's what we call GUI
06:58interface, graphical user interface. We're now migrating to what they call a LUI, language user
07:05interface. We don't think that's the most efficient. We think in the future it will be motion-based.
07:12Once you have that, then you have these smart devices.
07:14Paint us a picture. If I were to go on Trip.com in a few years from now with this integration,
07:19how would it look like this? For example, you have smart glasses on you. That's getting more and more
07:25powerful now. So you can then look into say, yeah, that's a picture I saw. That's an interesting place.
07:31You tap and say, where is that? And then the smart engine AI would say, yeah, that's the place that is
07:38in this part of the world. And this is a very popular trend nowadays. And people are going there. If you want me to
07:44book a ticket for you, it will be costing you this much. Are you interested? So this recognition capability,
07:51comparison capability, research capability will be all in one voice command. What you see and then
07:58what it can do will be all linked together. It's no longer a multi-search. I have to go there and find
08:04a photo and then come back and say, what is this place? And then tell me, where should I go? And so on.
08:09Everything we've done in one shot. I think the trend we're seeing right now is very much we call the
08:15event-centric entertainment trend. Okay. That's very tangible happening right now. Like concerts.
08:21Exactly. Formula One. Right. Since 2023, since the recovery from the pandemic, we're not seeing it
08:27just in one country. We're seeing it globally. Meaning in nine months, the number of concerts run
08:34in the entire world surpasses the entire 2020, 2019, right? And then surpassed it by 25% by the end
08:41of the year. So what we're seeing is people are traveling for a purpose. They want to find a reason,
08:48not just to visit friends and family anymore, or just the sightsee. I want to go there to enjoy,
08:54to have this fun moment that I can remember, because time is precious, right? What we all learn from the
09:00pandemic. So because of it, then this entertainment-based event-centric travel is actually emerging.
09:07We're seeing that being very, very powerful. And we see that a lot in Southeast Asia.
09:12We've seen spikes in hotel bookings in Singapore, when, you know, the likes of Taylor Swift,
09:18Lady Gaga, Coldplay came to perform in Singapore. In fact, when Taylor Swift came to Singapore,
09:27I was in Malaysia, traveling back from KL to Singapore. And on the print bag, all I hear was,
09:35oh yes, we can see her live in the action again. But the data tells us there's a spike in booking,
09:42per se, as compared year on year. And quite recently, there's some English football club that comes to
09:50Southeast Asia, right? You have the likes of Arsenal and Newcastle. Again, from our data standpoint,
09:59we see Indonesian fans, perhaps, or Malaysian fans, traveling to Singapore to see their favorite
10:04soccer players in Singapore. And of course, I have friends who travel to Hong Kong to watch
10:11Arsenal versus Toad to have. And, you know, traveling there just for the event.
10:17Okay.
10:18Right. Not for the destination, but for the event. So event-based traveling, I think this would be on the rise.
10:24What other trends have you noticed that perhaps post-pandemic that we may have not,
10:31well, that you have observed to have been growing?
10:34I think from last year, in Southeast Asia context, we've seen a continued interest in
10:42China as a destination. We've seen increased numbers in flight and hotel bookings for various
10:48cities in China, in countries like Thailand, Singapore, and Malaysia. I think that I will
10:56attribute that as the, you know, the visa being lived up and making people easier to travel to China, per se.
11:05But of course, I think over the past few years, the interest in China as a destination actually
11:13increases much more than other destinations that, traditional destinations that Southeast Asia actually likes.
11:21Okay. So how is STRIP.com positioning itself in terms of capturing this growing market? If you can
11:29speak to us about Southeast Asia particularly?
11:32I think for Southeast Asia-wise, right now, as I said, we are focusing on new and old destinations
11:42appealing to the local users, putting in a team of locals knowing when, where the locals are traveling,
11:51remains our very much focus. So you're also seeing airlines and hotels are also pushing for direct
11:58bookings. This is not just OTAs. So how are you seeing that competition too? It's getting to be even
12:05more crowded now. We don't see it as a competition per se. We actually think that there is a diverse
12:12offering and all the service providers were trying to capture the market and we actually offer that
12:18convenience for the consumer and also for the airlines to get into the right segment of the market.
12:24For them to do the same thing we do is actually much less efficient. Okay. Okay. Because we know the
12:29channel, we know how to operate it, we know how to operate the right efficiency and low cost. And for
12:35them to replicate the same thing, they need a 5,000 strong IT department, which is not practical for them.
12:42So OTA offers additional value to the channel providers, we call them, or the suppliers. Also,
12:49we actually offer additional customer service. That is something that the direct channels can never
12:54fulfill directly. For example, we offer the 30 seconds pickup by a real person service in customer
13:02service. So if you are not satisfied with your AI solution, we can actually route you to an agent,
13:08a live agent in 30 seconds. That's our promise. And many actual suppliers can do that. Right. So the
13:14additional value add is what we see the role that we play. Where do you see will be your biggest
13:20investments in the next couple of years besides technology, of course. Yeah. So I think a couple
13:25of places we want to get into sustainability. I think that's an underlying trend. It's not necessarily a
13:32super preference at this moment, but we see that as a table stick in maybe five years. People are
13:38really looking into how can I sustain this world while I still enjoy myself. So sustainable travel is
13:45one big trend that we're actually putting a lot of attention to. We're joining with the global
13:51Sustainable Tourism Council and working with them to display the right numbers, making the right choices,
13:57and helping that ecosystem to go further. We're actually seeing the millennials, the Gen Z's
14:04are doing it on their own preference in terms of the wellness part of their lifestyle. We're paying
14:10attention to that. And then also the silver generation, right? This is the baby boomers that
14:16actually has the money, they can actually spend it and they want to enjoy life at times where the other
14:22part of the population are busy working, right? So they can actually help the industry to continue
14:27to have consumption in the process. So that plays well with one another because we see everyone can
14:34travel on the weekend, but weekend time is very limited. From Monday to Friday, the hotels are half empty.
14:41So what do you do? Well, you want to promote travel for the people that can, right? So the silver generation
14:45will be another element that we pay attention to. Okay. All right. What would you say is
14:51perhaps the biggest threat that the industry is not talking about yet?
14:56So there are many threats. One is regulatory. Okay. I don't want to get into politics per se,
15:04but just use AI as an example. Different governments have different takes on what AI can do or cannot do.
15:13So they put out different regulatory requirements or policies where companies like us have to adopt to.
15:21And we do operate in 220 countries. And what do we do? We have to then tailor our solution to match each
15:28of these policies. That becomes quite challenging in how we can scale. So regulatory for sure is one of the
15:35challenges. The other challenge obviously is where does AI go in four to five years in terms of not just
15:43the technology itself, but how we operate as people. I think that is a big uncertainty that we have to pay
15:52attention to. Will AGI or ASI actually happen? If that happens, then what do we do? So I think those are
16:00unknowns that we have to really pay attention. Okay. Let's hone in on Southeast Asia then
16:07for you looking at the market because it's quite a dynamic market. It's growing really fast. So if you can
16:16share with us perhaps for your side, what do you see some of the biggest threat? Actually, I'm watching
16:22very closely. Shuba just mentioned about to be sustainable in environment. Sometimes, I mean, from our
16:32position, it's the young, right? They are paying more attention to the environment when they travel. But I worry
16:43about how can I deliver on these promises to them? Because the entire travel ecosystem, it's not, you know,
16:52under trip.com's purview per se, right? So that's one thing I'm watching out. I think within SEA region,
17:01also very important is the fluctuation in currency. It's quite volatile. And if such fluctuation,
17:11you know, swings wildly against the major booking currency, then I think there will be a shift of
17:17travel demand. And these are things that we cannot predict or hedge against, right? So these are the
17:25two major worries that I probably will have. Is price still the biggest determinant when it comes to
17:33customers choosing the platform they use? It really depends on which country we are looking at. But
17:41Southeast Asia per se, I would agree that to a certain extent, pricing does break apart.
17:48And the trust in that brand is important. I think on the third part would be whether this platform has a
17:56very strong and robust customer service team behind it, right? I think in trip, probably we are the only
18:05one that advertise our number, you know, customer service all over the place, just to gain that very
18:12valuable trust. I think as Evan pointed to, I think the market is much more diverse than we think it is.
18:20So price is definitely a important factor for a certain part of the population when they have a main
18:26purpose of going from A to B, like I said before. But we're thinking with these purposeable travel,
18:33event-based travel, entertainment travel, price is really not a main concern. If I have a mega star that
18:40I'm going after, Blackpink in Bangkok, I'm going. And if I'm going- If you can get a ticket.
18:45If you can get a ticket and they sell out in seconds. And then if that's the case,
18:50I really can't care less about price. So it all goes back to what is the main purpose of travel.
18:56And because of that, you can then dial your offerings according to that. If I can get you a concert ticket,
19:02you can probably allow me to sell you a hotel room and a flight ticket too. Is that something that
19:07you're looking at? That's exactly what we're paying attention to. So in the last couple of weeks,
19:11the team and I were- So in the last six months, I've found out more about
19:16K-pop bands and all the other names ever in my life, right? So the latest one we'll focus on is Seventeen.
19:23It's a very important band that has concerts in
19:27in Korea first and then going to Hong Kong, going to USA. We're trying to figure out how to get tickets
19:31of those and I'd be able to sell them when we're doing all sorts of events with them. So there's a lot
19:36effort we put in to make it very attractive for our customer. Your view about what are some of the
19:42bold bets that you will put in right now in terms of, you know, what's next in travel? What do you foresee
19:50would be the big things that you will double down on? Yeah. Yeah. So my answer right now,
19:55let me start and feel free to add my big bet or the bold prediction is still how does AI or ASI will
20:06be able to replace some of the way that we actually operate today and how does OTA get changed because
20:12of it? Like I said, we are now into this sort of multimodal interaction mode where people, how they book
20:21a trip in the future will be different. So how we then adapt to that environment will be very
20:28interesting in the next couple of years. So to me, that AI, the super intelligent part of it will be
20:34something that I think will happen. Is that something that the company is already investing in or looking
20:39into investing? We're trying to follow it. It's changing so fast that I don't think we're actually
20:43in creating it or inventing it, but rather we're just trying to follow how this technology evolved over
20:49time and how can we take advantage of that in our vertical of travel. Okay. What about you?
20:53I think just following what Shubha just said, I think SCA remains a area that for such tests to
21:01actually happen. Okay. Oh, why do I say this? I think the Southeast Asian population are young or very
21:09tech savvy, open to travel and because the ease of the high penetration of smartphone as well as the ease of
21:17adaption of digital payment allowed such tests to actually continue to test out before we grow it to
21:25the other market. And with the economic of Southeast Asia, most of them, you know, growing in strength,
21:33the middle class will emerge. And with that, we, I think, if I may, the smart dollars in Southeast Asia,
21:41of course. Yes, I agree with you. It's a very, very important market. All right. Well, thank you so
21:46much both to Shubha and Admin for sharing your insights. Best of luck with your plans. Thank you
21:51very much. Thank you very much. Thank you. Thank you.
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