Weekend Review: Low-Cost-Carriers In the Spotlight + Ctrip Buys Trip.com for Its Meta Unit

The Travel Industry's Daily Agenda-Setting Newsletter

November 4, 2017 View in browser

Note From the Editor It takes some sectors longer than others to reinvent themselves. And so it is with British Airways parent IAG and Air France-KLM, as we point out in two stories below. Creating airlines within airlines hasn't gone particularly well in the past, but the early returns are that IAG is doing just fine so far with its long-haul, low-cost startup Level. Air France-KLM, meanwhile, will launch not-merely-millennial-focused Joon next month, its entry into the LCC fray. Both have high hopes that their startups will set them up for better days in the 21st Century. On the online travel front, this is apparently the era of gifting acquisitions to your siblings. A few months ago the Priceline Group bought Momondo for its Kayak unit, and this week Ctrip went on a shopping spree and picked up Trip.com for its Skyscanner unit. And 2017 isn't over yet — there are still 52 shopping days until Christmas. — Dennis Schaal, Executive Editor Skift Has Partnered With TOPHOTELPROJECTS Sponsored by TOPHOTELPROJECTS World Tour On November 15th our partner is hosting TOPHOTELPROJECTS World Tour New York at the Standard High Line. This networking event brings together an exclusive group of local hospitality professionals including investors/owners/developers, architects/interior designers, hoteliers, and suppliers. Learn More Top Stories Qatar Under Blockade Is a Mix of Time-Sucking Layovers and a Fascinating Crossroads While much of the news media focuses on bigger-picture geopolitical issues emanating from the Saudi-led blockade, it is actually the small constrictions that can be the most painful in Qatar. But, despite increased travel friction, Doha remains one of the most intriguing places in the world at the moment. IAG Is Serious About Growing Its Low-Cost, Long-Haul Airline IAG's testing of the low-cost, long-haul market with a virtual airline seems to have paid off. Its success shows that the model is here to stay. We'll be keeping a close eye on how this affects the legacy carriers, including those in IAG's own brand stable. Wall Street Journal Launches Online Travel Site Powered by Upside Upside is trying to reach a more high-yielding audience of business travelers through its partnership with The Wall Street Journal. Whether the Upside experience ends up resonating with its users over the long term is another story. Air France-KLM CEO Touts His Millennial-Focused Airline That's Really for Everyone You may have seen Air France's new airline designed for millennials. But that's mostly a creation of marketers. Let's be honest. This is a lower-cost airline that needs to attract passengers of all ages if it's going to be successful. Ctrip Buys Trip.com for Skyscanner to Enhance Local Recommendations Ctrip-backed Skyscanner will tap in-destination content from social reviews company Trip.com. But is the acquiring company's true plan to further mobile engagement? Or is it to nab a domain name that may be appeal more to Americans than Ctrip.com -- or Alibaba's Fliggy? Skift Call November 7: A Framework for Overtourism Solutions When your city sees demonstrations against tourists — or even expressions of discontent beyond peaceful protests — you know you have a problem. Destinations around the world are struggling to find the right balance between welcoming visitors and barring them. We'll discuss a framework for figuring out solutions. Flying Business of Loyalty: United Airlines Appoints a New Head of Loyalty United Airlines has a new head of loyalty starting this week at the same time that major changes are happening within the program. Interview: Air France-KLM CEO on Millennials and Unions of All Kinds Is there a tougher job in the airline industry than making Air France more nimble? It's an airline that prides itself on its systems and procedures. But to compete forcefully in the 21st century, an airline must take chances. Air France needs to be more, in that regard, like its Dutch sibling, KLM. Singapore Airlines Unveils a Massive First-Class Suite to Compete with Gulf Rivals We expect Singapore's new first-class suites will be considered among the world's best products. But the airline still faces intense competition from Gulf and Asian airlines. It's not clear how much this cabin update will help on that front. Tourism Proposing Solutions to Overtourism in Popular Destinations: A Skift Framework As destinations scramble to reduce the impact of tourism on their citizens, foundational work must still be done to create a repeatable framework and process for preventing overtourism. Virgin Voyages Sharpens Its Focus With Adult-Only Cruise Plan One of the buzz phrases in the cruise industry for the past couple of years has been "multigenerational cruising." Virgin Voyages sees an opportunity in keeping one generation off its inaugural ship. A Majority of Avid U.S. Travelers Have Never Used Airbnb Despite Airbnb's precipitous growth in the travel industry, our latest survey results show that the company still has lots of room for growth among U.S. travelers. Hospitality Loews Hotels Is Taking a Contrarian Approach With Its Asset-Heavy Strategy It'll be interesting to see what works better for relatively smaller hotel companies like Loews, Red Lion, and even Hyatt with each of their respectively divergent business strategies: traditional asset ownership; totally asset-light; and asset recycling. Hotel Direct-Booking Pushes Really Worked and Owners Were Big Winners The bigger question, however, is whether these campaigns will still work in 2017 and beyond; offering discounted rates can only last for so long. Hotels need to start thinking about how they can ensure this momentum continues in the long run without having to use discounted rates. Hilton CEO Previews New Brands and Tech Launches for 2018 Here's hoping that new "hostel on steroids" brand is more than just a beefed-up Tru by Hilton. And that the technology powering Hilton's Connected Room actually works. Digital Video: Expedia CEO on Blockchain and Competitive Threats Expedia Inc. seems ready to further develop existing brands like HomeAway in 2018. An opportunistic acquisition or two might also take place, but CEO Okerstrom says he's focusing on organic growth from companies already in Expedia's portfolio. Tours and Activities Site GetYourGuide Secures a $75 Million Funding Round Whoever said there's no money in tours-and-activities may want to have a chat with the folks at Battery Ventures, whose investment in GetYourGuide brings that startup's total funding to $175.5 million. Expedia Axes Its Price-Matching Guarantee in a Sharp Break From the Past Expedia's move seems odd, as hotel chains ramp up their direct-booking campaigns that include best-price guarantees. Our guess is that the company tested and found that most consumers are no longer swayed by price-matching offers. Or perhaps there was pressure from ongoing probes in Europe. Global Distribution Systems One in Five Amadeus Bookings Subject to New Fees as Air France Adds Surcharge Air France's decision to join Lufthansa and British Airways in leveling surcharges means that 20 percent of the airplane tickets booked through Amadeus would be subject to the new fees. Expect Amadeus to try to undermine the effort with every muscle it has. Sabre Stays Profitable After Layoffs as the Company Vows to Become Nimbler Investors liked Sabre's third quarter revenue and profit report. But the verdict is still out on whether the company is relying on cheap fixes like layoffs to hit its targets or if it is laying the groundwork for sustainable growth. Travelport Signs Deal to Get Hertz's Prepaid Car-Rental Rates for the First Time As its pace of revenue growth slows, travel-tech player Travelport needs to diversify beyond distributing airline tickets. Rental cars are one bright spot. It is gaining traction thanks to a new deal with Hertz. Business Travel The Hassle of Flying in an Age of Permanxiety You can argue it's never been a better time to fly. Fares are cheap, and amenities like Wi-Fi and free snacks keep improving. Even better, airlines are updating their mobile apps, making it easier for passengers to rebook from delayed or canceled flights. But some people — at times, frequent flyers but mostly the infrequent ones — still view flying as a pain. Business Travelers Rarely Use Virtual Payments In Another Sign of Companies' Slow Adoption Most companies still give their business travelers corporate cards or ask them to pay upfront for later reimbursement. Given the rapid development of mobile and virtual payment methods for consumers, corporate travel is lagging behind yet again. The Race to Capture Unmanaged Business Travelers — Skift Corporate Travel Innovation Report Upside hopes working with The Wall Street Journal will attract high-yield and repeat business travelers to its service. We've seen before that media-linked booking sites rarely have staying power. As a customer-acquisition move, though, it could pay off. For Gmail users: If you are using the tabbed inbox, Skift emails may be pushed to the 'Promotions' tab. To get updates from Skift direct to your primary inbox, drag and drop this email to that tab. 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