Mark Frary headed to Sabre's headquarters in Dallas and asked its chief executive what travel buyers should expect next
SABRE’S BELIEF that mobile is the future for travel was much in evidence. Chief executive Sam Gilliland said: “If we look out a few years, we will transition from what has been primarily focused on a desktop perspective to mobile devices. We are investing heavily in ensuring capabilities work well for this.”
At the heart of this development will be its mobile tool, Tripcase. The company used the press conference to reveal how it would integrate features of its travel planning tool Virtually There, the Get There corporate booking tool and existing Tripcase trip management functionality into a single mobile experience for travellers.
“Tripcase will be the first consumer mobile and web solution that integrates with the systems and policies used by travel agencies, travel management companies (TMCs) and corporations,” said John Samuel of Sabre’s Traveler Solutions group.
corporate consumers
As a result, corporate online booking tools are going to start looking more like consumer-facing travel websites, said Get There’s Suzanne Neufang.
“Travellers are asking why they can’t book business trips directly on the internet, and they’re saying they like sites such as Kayak, Expedia and Lastminute.”
Paul Wiley, Get There’s head of product strategy, added: “That is where we are coming in and doing usability testing – not against how we were in the past, but against the leading travel solutions in the world.”
Speaking to the conference, Sabre Holdings president Tom Klein revealed that travel companies were having to become more efficient because of the increased amount of shopping around by travellers. “A few years ago, we were seeing 30 transactions [calls on Sabre’s systems] for each ticket. It is now over 300,” he said.
Greg Webb is president of Sabre Travel Network, the company’s division focused on agencies. He said, looking ahead, productivity gains for TMCs are going to come from allowing “some decisions to be traveller-led without the travel agency being involved in the transaction”.
Webb added that Sabre’s recent success among TMCs in Europe had not been as a result of buying business, saying agency incentives are “growing but not at the rate they have been for a while”.
“I think Sabre has a product and service premium – better products and better customer service. We were never the incentive leader and we don’t think that is why an agency should participate,” he said.
Meanwhile, airlines are looking much more closely at the true lifetime value of customers, the gathered journalists were told. Robert Wiseman, Sabre’s chief technology officer, said the company was looking at tracking the value scores of travellers. “At Delta, we found that Gold tier members of their frequent flyer programme [Sky Miles] were actually more valuable than those in higher tiers,” he said.
profits and prophets
In a one-to-one session with chief executive Sam Gilliland, I asked how the company defended its healthy profit margins at a time when others in travel are struggling. “If you look at the tech sector, the type of investment necessary to achieve the objectives required that we secure higher margins for our investors,” he replied. “If you were not, you wouldn’t get the investment.”
And what of the future? Gilliland is concerned about oil prices. “The economy can be moving along nicely but if oil is anything above US$100 a barrel, airlines will continue to with withdraw from the least profitable markets,” he said. “There are numerous markets that airlines need to service because of their network – for example, Las Vegas. Why would an airline pull out of Vegas? When oil prices were up to US$140 a barrel, airlines started pulling out.”
It is a concern shared by the company’s airline clients. Some 69 per cent said in a recent survey that fuel price instability was their biggest concern.
What do the debt troubles at Travelport and wobbly economic markets mean for a future floating of Sabre on the stock market? “We have very patient owners and patient management. We are not going [to float] today or tomorrow,” said Gilliland. “When the market opens up and it looks like it makes sense, we will probably go out to market again. We have been private for four and a half years and I would be really surprised if [our private equity owners] didn’t have some ownership for the next four and a half years.”
On Sabre’s court battle with American Airlines, Gilliland was relatively tight-lipped: “It appears that AA is intent on using the legal system to negotiate new commercial agreements, while we believe there are more productive and less expensive ways of doing that.”