What is xTripz? And what opportunity are we looking at?
Updated: Jan 1
xTrips is disrupting the international travel market to make travelling cheaper for travellers and at the same time help increase operating margins for travel suppliers.
Our vision is to be a community-owned decentralised travel experiences platform that allows travellers to plan, search and book flights, accommodations, tour attractions and travel activities at the cheapest price possible on one single platform, while earning rewards through purchases, reviews, sharing and other activities. By utilising blockchain technology, cryptocurrency and smart contracts, xTripz puts the decision-making power back into the hands of the consumers, making trips just what they’re meant to be - exciting, seamless, fun and memorable!
Pain Points in the Travel Industry
“I have been in the travel industry since the early 80s, and some of the issues that travellers faced today is no smaller than it was 10 years ago.”
Greg Duffell - Former CEO of Pacific Asia Travel Association (PATA)
As early as the 1970s, Global Distribution Systems (GDS) were some of the first companies in the world to facilitate business to business (B2B) electronic commerce. Airlines realised that by automating the reservation process for travel agents, they could make the travel agents more productive and essentially turn them into an extension of the airline’s salesforce.
Today, a GDS is a worldwide conduit between travel bookers and suppliers, such as airlines, hotels, cruises and other travel activities and services providers. It communicates live product, price and availability data to travel agents and online booking engines, and allows for automated transactions. The tangled web of databases has become even more of a labyrinth following the explosion of online travel agencies (OTAs) like Booking.com, Expedia and Wotif. Hotels and other travel entities can use technology solutions to capitalise on this trend, tapping into GDSs like Amadeus, Sabre and Travelport.
In the early 2000s and after the impact of the Dotcom Crash has subsided, there was another wave of transformation driven by companies that had survived the crash. These companies were not just leaner and meaner, but also able to pick off weaker competitors. Bolstered eventually by the introduction of the iPhone in 2007, a period of rapid transformation ushered in an era of consolidation, which saw a dramatic increase in market concentration among just a few dominant players who used M&A to pursue growth in both supply and demand.
After all this consolidation, there are now just four major holding groups of OTAs and related travel sites (such as metasearch, rental cars, and restaurant reservations), controlling over 95% of the market:
Frenemies… That pretty much sums up the relationship between travel industry suppliers and online travel agencies (OTAs). On one hand, the hotel booking sites like OTAs provide a steady source of hotel bookings that reliably puts heads in beds, all without that much effort on the part of suppliers. On the other hand, this “effortless demand” comes at a hefty cost: up to 30% commissions on each booking. For the suppliers in the Travel and Tourism sector, the relationship with the OTAs becomes a necessary evil, or you struggle to get customers for your business.
Today, It’s increasingly difficult for new entrants to marshal enough resources to compete at scale. For context: Expedia and Booking spent over USD 10 billion in combined advertising dollars during 2018. OTAs remain dominant on both the demand side (due to deep-pocketed investments in digital advertising) and on the supply side (due to global footprints of local market managers), which makes for a nearly-impossible environment for upstarts -- and has brought the sector into intense regulatory scrutiny.
xTripz Network’s competitive advantage lies in the underlying decentralised digital economy that provides a stronger business model as compared to traditional travel businesses. The xTripz platform drives adoption through incentivising various behaviours as the consumer moves through the customer journey of planning, booking and enjoying their travel experiences.
Lets dive in and look at some of the problems in the travel industry and how xTripz Network can help to solve the challenges and make travelling a frictionless experience and create wonderful memories for everyone…
Problems faced by Travellers
1) Information Overload
Fragmented sources of information from all over the internet, with little certainty over the reliability of the information. The average person spends more than 10 hours planning a holiday, according to a new poll conducted by UK newspaper Independent. The survey of 7,800 tourists across 26 countries, including the UK, the US and Australia, revealed that most respondents typically started to lose interest while planning a break, 42 minutes into the process. In another Expedia Group whitepaper, travellers are inundated with a multitude of seemingly unlimited resources when researching hotel and flight options for an upcoming trip, especially in the 45 days leading up to a purchase. This is the time when shoppers consume the most content— making, on average, 38 visits to travel sites, and 15 visits just in the week prior to booking—in an effort to satisfy their voracious appetites for intelligence on all of their potential travel experiences and purchasing options.
2) Lack Trusted Reviews
Reviews are important. An independent study among 12,000 global travellers conducted by PhoCusWright in late 2013 on behalf of travel site, TripAdvisor, reveals that more than half of the respondents would not make a hotel booking until they read reviews about the property. 80% of travellers read 6-12 property reviews, with 1 in 5 reading more than 11 reviews, on average. People who had a negative experience were also 50% more likely to share it. Between 5 and 10 million reviews on TripAdvisor could be fake. Chris Emmins, of the online reputation management company Kwikchex, has been studying TripAdvisor for eight months and said he believed as many as 10 million reviews on the site were fake. "Unless they take some action to actually verify reviews it is going to become useless. The sophistication of the agencies that are working posting fake reviews is getting quite extraordinary," Mr Emmins said.
3) Dysfunctional In-trip tools
In Travelport’s "2018 Digital Traveler Survey" of 16,000 travelers from 25 countries, it was found that on average, travellers use 10 to 12 apps throughout the searching, booking and travelling parts of their trip. Google’s research showed that when it comes to downloading and using an app, 67% of travelers prefer an app with various functions rather than many single-purpose apps. As travel apps rapidly replace everything from boarding passes to car rental and hotel room keys, many such apps are falling short of user expectations, according to the J.D. Power Inaugural U.S. Travel App Satisfaction Study. Travel apps could be highly valuable tools but often fail to deliver on their promise to deliver better travel experiences.
4) Lack Flexible Payment Options
Online travel sector is growing global, yet payment remains local. European Travel Guide by PPRO and Klarna reveals that lack of payment options puts the brakes on travel plans. The research report reveals that one in five adults have cited a lack of flexible payment options as their biggest online travel shopping frustration. Cancelling trips and getting refunds for trips booked through a middleman like online travel agencies can be complicated. Some airlines are making it incredibly hard to determine if you’re eligible for a refund. Booking through an OTA complicates things further, since they need to check with the airline if they can process a refund on your behalf. As such, there’s a good chance you’re going to be stuck in a lot of back and forth between you, the travel provider and the OTA before getting the money you deserve.
5) Unfriendly Loyalty/reward Programme
IBM Institute of Business Value published an executive report in 2015, titled “Travel Loyalty: Discount Discontents”. According to the report, 67% of travel loyalty programme members would switch for a better deal. Almost all consumers identify themselves as brand loyalists, but the majority told Maritz Motivation that their loyalty could shift if a more enticing offer grabs their attention, citing price, product/service quality and promotions as their primary drivers for brand switching. 69% quit loyalty programmes because “benefits took too long to earn”. This year’s Merkle Loyalty Barometer Report showed that free products, discounts, and offers remain the benefits most desired by consumers from a loyalty programme, with 70% of consumers preferring discounts and offers.
Problems faced by Travel Suppliers
1) Polarised Reviews
No fair representation in review systems. A common problem with online reviews is polarisation bias with many extremely positive or negative reviews and few moderate opinions. This can give a misleading view of opinion about the product and company. It is proven that a company or brand with a higher overall rating and a large number of reviews can reap the rewards of such customer feedback, resulting in financial benefits. However, the brands and operators can have no control over the user-generated contents and travel experiences posted on various online reviews sites the likes of TripAdvisor, and have little recourse to defend themselves against malicious reviews or ratings.
2) Challenging Payment & Settlement
Travel is an ultra-high-risk sector for payment acquirers because most payments are for future delivery. If merchants fail to fulfil a service for which they have taken payment (often months in advance) customers can recover their money from the payment acquirer by initiating chargeback. Acquirers traditionally demand substantial cash collateral (holdbacks) or other financial security from travel merchants to mitigate this risk. Holdbacks lock away substantial funds for travel companies and can therefore be highly damaging to liquidity. High-profile collapses and the COVID-19 crisis have driven acquirers to impose even harsher terms or quit the travel sector completely.
3) Low Operating Margins
According to research numbers from Amadeus Hospitality, OTAs continue to dominate the online booking landscape, accounting for 64% of all online hotel bookings in 2019. And they charge commission of between 15% and 25% on bookings, and sometimes upwards of 30% for smaller independent hotels, severely denting their operating margins. The 2-1 ratio of OTA vs. direct bookings has remained consistent in recent years — despite the healthy Compound Annual Growth Rate (CAGR) achieved by direct booking channels. When you consider the commissions paid out to OTAs with each booking, it’s not hard to realise that every one of those bookings would amount to profits lost by hotels that OTAs will most assuredly reinvest in new technology, new tactics, and new strategies to maintain their competitive edge.
4) Little Customer Loyalty
The challenges around maintaining and generating guest loyalty are greater than ever before. The market-wide disruption caused by COVID-19, economic worries, proliferation of OTAs, review sites and social media commentary all influence the modern consumer’s decision in booking travel experiences and other travel activities. It will be those hoteliers who plan, listen and respond to guest needs who will be best positioned to attract new and returning business. More than 83% of travel companies reported that attracting new customers and retaining existing ones were their primary challenges. Travellers are very vocal in their desire for one-stop travel experiences, and 39% of travellers chose OTAs because they could book multiple aspects of their trip, as reflected in “Resetting the quest for travel loyalty in 2020” by Switch fly.
5) Hard to Introduce Personalisation
“Our Personalization report has shown that 83% of customers expect relevant information and travel experiences to be recommended to them based on their personal preferences. Consumers want personalised travel experiences because they want to feel like their interests and preferences are taken into account seriously.” as published in Sabre’s 2017 Radar Report. However data privacy and security poses several challenges in implementation. In May, Skift Research took the pulse of U.S. travellers to ask whether they were willing to share personal information such as age, gender, and address, in exchange for personalised travel offerings. A majority said no, with consumer resistance to sharing data being a key complicating factor.
Our competitive advantage lies in the underlying decentralized digital economy that provides a stronger business model as compared to traditional travel businesses. The xTripz platform drives adoption through incentivising various behaviours as the consumer moves through the customer journey of planning, booking and enjoying their trips.
The xTripz technology platform offers tremendous benefits to both the consumers and the merchants through the innovative use of blockchain and distributed ledger technologies to provide a trust-less and autonomous environment for purchasing and sales of travel experiences through an interoperable and cross-chain customer engagement tools and analytics service.
Here a snapshot of some of the innovative features that xTripz have in store:
xTrip Explorers are people who have fun when travelling, while earning rewards by producing high-quality content on travel activities they experienced. They will also have the chance to earn sales commissions when they help promote our products and services.
Decentralised Autonomous Organisation (DAO)
Community-owned platform and the decentralised governance structure to align the interests of all the parties in the ecosystem. The decentralisation ensures that no single party can dictate any major decision impacting the community.
Custom non-fungible tokens (NFT) of VIP memberships for $XTR travel token holders with a certain minimum holdings. Tokenised NFTs representing special packages for the high-end luxury market, which can be redeem or sold on partner NFT marketplace.
About xTripz Network:
xTripz Network aspires to become one of the best travel booking site in the world, one which is fully decentralised and community owned and governed. The xTripz platform facilitates discovery, shopping, booking and payment of travel products, with novel DeFi and NFT features, replacing travel gift cards with our $XTR travel token, and providing our users memorable travel experiences and wide offering of travel activities. Our travel guides provide up to date information, including popular searches on travel activities, glamping near me and travel cryptocurrency.