Indirect vs Direct

Direct brands are slow Innovation is limited by Red tape Internal thinking Lack of collaboration Restricted access to data / inventory > Has the latency of direct brands helped to fuel intermediary growth?

Indirect - consumer benefits Strong Value Proposition Price / product Comparison Global Reach Simplicity in booking Particularly relevant in fragmented verticals > Indirect is here to stay

Indirect - business benefits Distribution Intermediaries are a highly productive channel Dominate search / acquisition Instant tap to fill inventory > No direct vs indirect – More efficient channel vs non?

Indirect – real costs Distribution costs High commission on hotels / cars + GDS fees flights Consumers pay the price However are true direct costs really understood > Are there hidden costs to direct acquisition? 1st time round indirect is cost effective. How do you hook customers in beyond that?

How are brands fighting back?

1. Direct proposition Tangible consumer benefits Hilton: Stop clicking around (book + join) Car rental: Touchless access Flights: Merchandising of extras & fare bundles > Is the obsession for direct bookings a result of the intermediary monopoly and high distribution costs?

2. Loyalty / data Customer ownership Power struggle: Direct vs Intermediaries Intermediaries looking beyond Acquisition Data and customer ownership is key > Direct brands need to protect the conversation across the entire journey: Loyalty & upsell

3. Additional services Customer access Ryanair: Deeper integration with ancillaries Airbnb: Expansion into tours / flights Airlines: Upsell of own services > Direct brands are extending their product range to compete with OTAs

Will this shift the needle?

Technology Improved access Blockchain: democratise data & inventory. Free thinking! NDC / APIs: Make indirect semi direct Tech to support direct or indirect proposition Anticipate behaviour of next generation > Unless the high barriers to entry into travel are removed innovation will be stiffled

Conclusion No longer about direct vs indirect (neither going away) About direct interaction with end consumer Getting access to data on consumer Merchandising power through any channel Comparable cost of sale (ROI will determine) Multiple channels will drive innovation