Author: Trevor Charles
The Middle East is quickly realizing that mobile apps are the new oil, especially within the travel industry! The region is large and very diverse, comprising of more than 12 nations each with its own uniqueness and characteristics regarding religion, language, culture, and politics. But the fundamental commonality that exists across the entire Middle East is that the population is very young, educated, and tech-savvy.
Just about one in five people in the region are between ages 15 and 24, making it one of the youngest population in the world. This young age, along with the fact that most people are always on their mobile devices, has greatly facilitated the rise of mobile applications in the region.
Mobile bookings and online travel, in general, are some of the areas that have shown a steady rise within the past few years. This industry, by 2023, is projected to hit the $15 billion mark across all regions in the Middle East. Such a figure will mark an increase of over 140% from the current state, according to Mena Research Partners.
This is because the region is undergoing something of a digital transformation across all touchpoints in their travel activities.
The increased rise of mobile travel bookings is being driven by travelers looking for quick overnight stays or last-minute deals. Mobile platforms such as travel apps are seen as the easiest means of providing prompt bookings for such impromptu plans. They also provide quicker searches at the best convenience possible.
Criteo’s Travel Flash Report (Winter 2017/2018) found that up to 89% of traffic for last-minute bookings come from mobile travel applications, which has also aided their spike in use. According to Devina Divecha, a travel analyst and expert, the rise of online travel bookings in the Middle East are set to disrupt the travel industry, shaking up even the biggest players such as TripAdvisor and Bookings.com.
Just like football players, train hard to improve and become NFL MVP of 2019, companies also are battling with each other seek to gain a competitive edge and become MVP of the industry. Either through the creation of space-age travel mobile apps or generating travel traffic through travel search engines in established websites.
In fact, other than travel apps, it is evidenced that multiple travel agencies, as well as search engines, have entered the Middle East, including both home-grown brands [such as Rehlat (Kuwait) and Tajawal (UAE)] and international companies [such as Cleartrip (India) and Wego (Singapore)].
All of these mobile booking platforms for travel have reported growth in bookings and interest from the consumers. For example, Wego, after entering the Singapore travel market six years ago, the company has had over 60% growth in revenue year after year achieving profitability [18 months ago] on $1 billion worth of gross travel bookings. Other such as Al Mosafer in Saudi Arabia are also big actors in the Middle East’s online travel industry. The company’s ‘book-now-pay-later’ model has massively built trust with customers, particularly those who had been wary of purchasing online in the past.
The rapid growth of mobile technology over the past decade, as well as increased connectivity and faster internet speeds, have facilitated this rise. As aforementioned, this is also expedited by the emergence of multi-billion dollar app development industry, young, tech-savvy population, and innovative, mobile-friendly websites. The result of this amalgamation has propelled the shift towards mobile-based browsing, which is seen as fast and convenient.
In other words, mobile bookings and searches are now, more than ever, used over computer and desktop in the Middle East. This is also coupled with the increased trust in online payments than it was in previous years. For example, the Gulf Cooperation Council, consist of six states in the Arabian Peninsula recorded a 110% increase in mobile bookings by the end of 2018. In this report, Kuwait had the highest rise with 81%, with Riyadh topping the list of the companies with the highest increase at 40%.
Online investments and partnerships are also said to play a significant role in the recent rise of mobile bookings in the region. Traditional travel agencies are realizing that some of their outmoded marketing strategies aren’t doing the tricks in the modern world. As such, they are investing heavily on up-to-the-minute strategies such as the creation of websites and SEOs to allow people to purchase their services online.
The rising usage of mobile internet via mobile devices now means that even traditional establishments can now tailor their strategies around the mobile model. Similarly, such agencies are also finding partnerships with other online providers and online travel agencies (OTAs) to ensure that their offering is brought straight to the eyes of their target customers via their smartphones. Tourism boards in these countries are also considering initiatives that are digitized, aimed at creating awareness not only locally but internationally as they endeavor to promote the regions travel attractions and destinations.