In the week that one of the world’s biggest OTAs adds Google Assistant to its voice offering, Pamela Whitby catches up with Expedia’s head of research

If you had a billion-dollar war chest to invest in emerging technologies for travel, which would you bet on and whose lead would you follow? Given that Expedia Group earmarked $1.3bn for investment in technology in 2017, and has a rigorous test and learn culture, Abhijit Pal, Expedia’s head of research believes they may not be a bad bet.

So, where is one of the three giant global online travel agents (OTAs) putting its money? According to Pal, among the new and emerging technologies that the firm is both “excited by and cautious about” are virtual and augmented reality, AI and machine learning, cloud and voice.

While Expedia is at different stages of the journey with each, it is investing millions in cloud which is a “big bet, and a mature investment” in the drive to profitability. Another priority for Expedia is voice.

Expedia is excited by and cautious about new and emerging technologies and is investing heavily in cloud and voice

“We’re also investing heavily in voice because this is a technology that is becoming widely adopted. We know we need to be there because these are devices that our consumers are interacting with everyday,” he says.

In the US, adoption of voice is particularly marked. Nearly one in five US adults have access to a smart speaker and 20% of the population actually use these devices, according to research from Voicebot.ai. This growth trajectory shows no sign of abating either, according to Statista, which claims that the global smart home market will be worth $53 billion by 2022. Here again, the US is likely to be the biggest spender compared to other regions. 

More than just ‘skill’

As early as November 2016, Expedia launched its ‘skill’ for Amazon’s Alexa-enabled devices. This week, nearly two years on, Expedia has officially added Google’s voice assistant to the mix. “The Expedia Action is free, easy to use, and is available in English on any device that supports the Google Assistant,” says the official statement. While both allow users to, among other things, search for hotels and flights, add a rental car, access trip itineraries, check and review loyalty points, the big difference is that travellers can book in Google, thus building on the Alexa experience.

Today Expedia’s voice offering provides a realistic, fairly simplistic offering with the possibility for basic transactions – such as the ability to book a car. Pal argues, however, that in the future travellers will start to see more value.

“The future will look different, as we start innovating. But we do need to know more about the consumer and for this we need to have a better personalisation, better AI…those technologies really need to stack up before we can create a true transaction model [for voice],” he says. 

Technologies really need to stack up before we can create a true transaction model for voice

Like any commercial operation with the constrained resources, the ideal end goal from any investment in new technology must be to make a shed load of money. However, Expedia recognises the need to be “valuable to travellers beyond the transaction,” and Pal argues this doesn’t necessarily require huge investment. For example, the launch of augmented reality app that allows travellers to point a camera at their luggage to establish whether it will fit in the overhead bin is one example. The app may not sell a hotel room or flight but by being useful it helps to create stickiness, and may even lead to sharing on social media.

Too much choice is a bad thing

Voice may not be profitable for Expedia yet, nor cloud for that matter, but the potential for these technologies justifies the leap. And, both are expected to eventually deliver commercial value in time.

Looking to the future, then, advances in technology could mean that the phone eventually becomes the users primary computer. However, while screen-mirroring technology will address some of the challenges of screen size, voice offers a natural extension to the challenge of ever expanding choice.

Expedia Group today has 750,000 lodging options and is rapidly bringing 1.7 million vacation rentals into the mix, and this can create friction. “We believe choice is important for a dual-sided market place but at some point, too much choice may create conversion loss,” says Pal.

We believe choice is important for a dual-sided market place but at some point, too much choice may create conversion loss

Certainly, no brand wants consumers to be spending hours hopping around trying to pick the perfect accommodation for their stay, and voice has a potentially important role to play in narrowing down the choice. For Expedia how this plays out is still to be determined, but through investing in voice technologies like Google Action the signals become clearer.

What Expedia understands only too well is that it needs to be ready for action. “If and when the community and utilisation of various market places grows, then we can unlock the next stage of investment, to take the business case to the next level,” explains Pal.

EyeforTravel’s San Francisco agenda 2019 will launch soon and Expedia is one of the big global brands that will be taking to the stage