For those not involved in the world of business the term ‘B2B’ sounds like a K-pop band or brand of sneakers. Add to that the word ‘travel’ and the Sunday lunch informal chat with your new mother-in-law can leave her more confused than enlightened.
Tried using the term ‘travel tech’? Yes, it just gets worse. Ah ha, you engineer the black boxes on jumbo jets or design indestructible wheels for suitcases!
Try another tack with ‘behind-the-scenes’ and well they imagine you literally behind-the-scenes, working on the luggage conveyer belt or in accounts payable at the hotel.
Despite the fact that they know you aren´t a pilot or hotel property owner, how often do friends and family ask you for discounts for flights or hotels?
The average person can be forgiven for only conjuring up images of consumer travel brands. But why do people in the travel industry still over-focus on this one area?
Money wise, they couldn´t be more wrong: B2B services are more profitable. For example, the market capitalization of many of the biggest hotels or airlines in Europe is still way less than some B2B travel technology firms such as Amadeus.
A well-known venture capital investor for the travel space once commented on how frustrating it was that nine out of 10 ideas pitched to them were for consumer services, despite such businesses tending to be risker and much lower profit margins.
Sadly the speaker line-ups for industry conferences gives the impression too that B2C is really the more dominant sphere.
Nonetheless, opinions on B2B are starting to shift as technology is creating more B2B opportunities than ever before – not least with the recovery underway and so many companies looking to save costs and introduce efficiencies, in a way that only technology could ever achieve.
This is why at Belvera Partners we are 100% focused on the B2B market: we know our strengths and focus on our core offering.
Consumers might be the final stop on the travel industry journey. But as the steady growth of B2B players and travel technology providers shows, consumers are far from the only stop along the way.