Saturday, September 30, 2023

Flightroutes24 adds hotels as it continues Global expansion

Flightroutes24, the global B2B marketplace for flight content, is ready to expand not only geographically but also across verticals – it is adding hotel content, launched in 2023, according to Nancy Zhou, co-founder and vice president, business development.

A report in WebinTravel said the company was repositioning itself as a “leading global travel content aggregator,” and it will launch a hotel booking channel to offer a one-stop “flight + hotel” product.

Zhou said, “Our customers were telling us they want a one-stop shopping experience, instead of having to work with several partners. So we thought, we already have customers, why not have more products for them?”

It offers more than 400,000 hotels, with content piped in from third parties in the beginning and have started to directly contract with hotels this year.

Hotels have a better profit margin than air, which is also getting more and more flight aggregators and platforms to solve an increasingly complex air distribution market, with the rise of low-cost airlines, now accounting for 30% of global air capacity, and the rollout of direct and NDC strategies by full-service airlines.

The company started off in Hong Kong and Shenzen in 2014 focused on delivering both local and global air content to Chinese travel agents, given the rise of the Chinese outbound travel market at the time.

“At that time, people in China could buy tickets easily within China, but when they wanted to travel globally, tickets were expensive,” said Zhou, who came from Qunar, the leading flight meta search in China at the time. “We wanted to aggregate global content and provide the best, reliable and most competitive air fares to travel agents in China.”

In 2019, it decided to expand outside China, to bring overseas travel agents onto its platform and provide them global comprehensive products. As it turned out, that was good timing because when COVID-19 struck and travel in China ground to a halt and stayed largely grounded for three years, its overseas business held up the company.

“We saw good movement globally during the pandemic. Our main business was affected and we invested in building out our global business.”

Claiming thousands of global partners and more than 60 point-of-sale countries, Zhou said overseas agents make up 80 per cent of the business, with the other 20% from China.

Flightroutes24 covers the full spectrum of air content, from low-cost to full-service, and offers a mix of its own content as well as partner content. It covers over 700 airlines and 500,000 routes, and in 2022 its transaction volume increased by 200% compared to 2019.

“Chinese outbound travel still hasn’t recovered fully, but international volumes are up and we see growth opportunities in those markets.”

While Southeast Asia and the rest of Asia currently form the bulk of overseas business, Zhou sees potential in markets like Europe and the United States for a player like Flightroutes24 to provide the technology solutions to support trade partners at a time of disruption in the flight space.

“I think the opportunities are not only in geographic markets but also in technology,” she said.

“Carriers’ selling capabilities are more and more tech-oriented. If we can have outstanding tech, we will have opportunities. We are investing strongly in our tech products to help solve problems for trade partners in Europe and the U.S. because they face different problems than, say, the agents in Asia.”

The company will invest in data services and software as a service solutions.

Asked about the biggest challenge it faces in expanding globally, she said, “It’s not only about building up trust, but we also need to ensure both partners make profits after a certain time.”

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