It’s no surprise that the travel industry is going through probably the worst crisis in its history and it affected every company either directly or indirectly. But the question remains, has it affected equally to every type of business? Definitely not.
Overhead
Different types of businesses of course have different levels of overhead that they need to run. The higher the payroll and fixed costs, the higher the risk you take when revenue plummets.
Metasearches are clear winners on this category because:
- Don’t have to operate the complexity of flights operations
- No customer support or post sales assistance
Financials
Cash Flow management and profit margins are also a great factor in how a business reacts to a crisis like Covid and again metasearches have an edge on this topic:
- Avoided refunds complaints
- Less legal liabilities
- No debt was taken on most cases
Marketing
When demand goes down that also means competition goes too. Less brands are bidding for those usually expensive CPCs and that translates to lower prices across the board.
Metasearches are better at digital marketing than most airlines and OTAs and the reason is that their business depends 100% on that, it’s their main value proposition. This competitive advantage comes in handy now more than ever. With lower CPCs they will be the ones to take advantage the most out of the situation. And even when demand picks up again it won’t be as high as before for a while, so marketing spend efficiency will be paramount. In the short term all this will end up being a market share increase for metasearches.
Final Thoughts
Since on every major category metasearches seem to have an edge we can conclude that we are in presence of a meta-dominated post covid travel market. This is not necessarily bad if you are an airline or OTA, but definitely represents a red flag that you should be paying more and more attention to them because they will soon become your main channel of acquisition, if it’s not already.
Investing in automation and setting up dynamic pricing strategies is more important than ever and you shouldn’t wait until everything is back to normal to start working on this. Then it will be already too late.
