Q&A: Technology and travel in the Middle East
Business Review Middle East talks to Stewart Smith, Sojern’s Senior Director of Sales for the MEA region, about the fast-growing travel sector in the Middle East.
Tell us a little about Sojern
It is travel’s leading data-driven performance marketing engine serving over 1,000 travel brands worldwide. Its Sojern Traveller Platform, including 350 million user profiles and billions of traveller intent signals, along with custom data science and campaign optimisation algorithms designed to reach and convert travellers, delivered over $3 billion in bookings in 2015. Recognised by Deloitte as one of the fastest growing companies in tech, Sojern’s mission is to help every travel business reach, engage, and convert current and future travellers across channels. Sojern is headquartered in San Francisco and has an office in Dubai.
Why was opening an office in Dubai a priority for your business?
The Middle East is home to three of the world’s leading international airlines and a fast-growing hotel and tourism sector. In fact, the Middle East is the fastest-growing region for travel with the UAE being the dominant market. Not only that but with a young population, one in six customers in the Middle East is using the Internet as the booking platform of choice. The Sojern Traveller Platform will help travel brands connect with a young and tech-savvy audience that is looking to travel within - and outside of - the MEA region.
What were some of the challenges you faced in opening an office in the Middle East?
Understand who your customers are: One of the key challenges in opening an office in a new region is understanding who your customers are and reflecting their needs. It became clear early on that the UK for example, is ahead in terms of understanding and adoption of programmatic advertising and therefore it was vital for us to tailor our messages and the way we discuss our business with potential clients.
Tailor everything! Tailor your marketing messages, your prices, your payment terms, your pitches and your service to suit your new client's’ needs. Just because it worked in the US doesn’t mean it will work in MEA.
Recruit a team - It’s also key to remember that you can never underestimate local knowledge! Soon after we opened I recruited an experienced team to support our business in this region. Josh Beckwith, our Sales Director has worked in digital marketing in the Middle East & Africa region for over 8 years. Having a team who is experienced in the cultural differences of doing business in a new region instantly makes opening up a new office easier.
Be compliant: Another challenge in opening an office is ensuring you are compliant and not breaking any legal requirements specific to the region.
Location, location location: Choose an office location that is not only accessible for staff and clients but is also professional enough that you can conduct meetings there and host clients.
Be social: Join local networking groups and industry associations so you can meet people and learn from them as well as increase your pipeline of potential clients!
Enjoy it! Opening up a new office in a new region is a fun experience. Enjoy all the challenges and successes!
What are some of the unique characteristics of this region?
Despite there being a young population with 44 percent of the ME population under 20 years old and some of the world’s most active and dedicated smartphone users, there is a hesitancy to transact online. Consumers within this region still have an affinity towards cash payments when it comes to travel. According to ThinkDigital, among UAE leisure travellers 39 percent use the internet to plan their trip, but only 12 percent book their travel online. We may find that like some other global trends there is a short lag in this region when it comes to fully going online for travel. Having said that, I’ve noticed that although there is a lag in the adoption of some technologies, what would usually take the rest of the globe three to five years to fully adopt, takes the ME region far shorter. Again, it seems that once the region decides to commit, it moves quickly.
How does the digital marketing industry in the Middle East compare to Asia, Europe and the US?
It is following very similar trends to the rest of the globe, it’s just taking a little longer to be fully adopted. The combination of technology and data is extremely powerful in marketing and beyond the wave of programmatic buying and RTB, we are now beginning to see digital marketing entering the mainstream in the Middle East. With the Middle East considered as the fastest-growing region in travel, we are seeing brands utilising real-time data in order to target consumers in-market for their service at precisely the right time with a highly personalised offering in order to drive ROI.
What areas of the digital marketing industry in the Middle East region are more advanced than other areas globally?
In terms of mobile adoption, the Middle East region is only second to Asia-Pacific. According to eMarketer, as of mid-2015, almost 30 percent of the population in the region were using mobile devices to access the internet, equivalent to almost 110 million people. The number is set to increase to 172 million by 2020, by which time 42 percent of the population will have mobile internet access.
Growing mobile broadband and smartphone usage is driving an explosion in mobile data in the region. In fact, Middle East smartphone users are regarded as some of the most active and dedicated worldwide. The rise of mobile is changing booking patterns, consumer behaviour and business models in travel. This generation of millennials have a notably shorter attention span in an environment where they have access to an abundance of information, options and channels all in the palm of their hand. To compete, brands now need to develop customer-centric experiences that are highly personalised, engaging and delivered at exactly the right point in the path to purchase across all available channels.
What are some of the key challenges travel brands based in the Middle East are facing when it comes to targeting their customers and driving revenue?
The region’s affinity to traditional travel agencies and cash payments is certainly a challenge when it comes to creating a complete online digital marketing strategy for travel brands. That being said, some of the major Online Travel Agents (OTAs) have tailored successful models for the region. For example, Booking.com has an Arabic-language website, and also accepts offline payments on arrival at the hotel, in addition to credit card transactions. This suits travellers who want the value and choice of online booking, but still prefer to pay in person.
Another challenge which this region is not alone in facing is the need for personalisation. From hi-tech dream to everyday reality, the way we research and book travel is almost unrecognisable to five years ago. Today’s consumer has an abundance of channels and information sources now available to them across multiple devices making the path to purchase increasingly long and complex. In fact, these are the savviest consumers that markets have ever known. People understand the value exchange between the data they provide and the services they get in return. These trends along with the sharing economy and last-minute booking have all had a huge impact on the way consumers now book travel.
Read the November 2016 issue of Business Review Middle East magazine