Airports, airlines, air service developers, service providers and others are seeking to creatively solve new and old problems alike, through partnerships. However keep in mind, there are many partnership formats benefiting businesses, from development partners to marketing partners and more.
First step prior to assessing partnerships is to identify which problem can be best solved through a strategic relationship. For an in-depth look at how to first approach a problem, explore the Cirium ebook, Innovating in a crisis.
Why partner now? As travel companies look for ways to pivot and adapt to new market demands, partnering could have some key advantages.
“Strategic relationships will be a driving force for revenue generation in the next 18 months. These relationships can be force multipliers for both parties, and Cirium sees those relationships as proof of how resilient this industry is,” says Danielle Molder, Vice President Global Partnerships.
Then how should companies use partnerships to build resiliency? In spite of the mounting pressures and moving targets, strategic partnerships reinforce speed-to-market, customer relationships, and quality services. Here are three benefits for those looking to fit partnerships into planning and go-to-market efforts.
Three leading benefits of partnering
1. Speed to market
One of the immediate benefits comes from gaining time and perspective. Spreading the load across partners can give both parties more time to focus on that newly simplified strategy, and streamline costs and resources. Within travel, this may look like a technology integration or white label partnership. Rather than delivering an end-to-end solution, many companies are smart to place the delivery of new tech outside their core competency with partners.
In the medical space for example, due to the pandemic, many organizations planned proactively to handle the potential increase in demand. Major hospital networks have ramped up focus on telemedicine. With the need for immediacy, Tufts Medical has partnered with a technology provider to expand the services they offer to the community.
It is also predicted large scale enterprises will shift existing technology work to IT consulting and boutique development shops. A recent survey found demand for expertise in cloud infrastructure outsourced to service providers, is set to increase in the next 18 months. Those technology providers who can bridge solution gaps for travel companies could be strong partners to navigate changes in the market.
2. Multiplying market reach
The right partnership could multiply market reach. If resources are limited, and it is hard to address all the possible target audiences, partnering can be a key step in amplifying go-to-market activities.
The economic downturn has many tourism destinations looking to their airline and airport partners for fresh ideas. We have already seen impromptu initiatives with these parties working together to bolster their appeal to those still interested in traveling. Travel bubbles are one such quick move to partner. Airline alliances like Malaysia and JAL, are another example intended to grow their collective airport network. In addition to alliances, airlines have increasingly expanded their partnerships for distribution, as well. Airline data providers working with Cirium benefit from reaching more than thirty-five percent of global travelers just through daily flight information accessed through the industry’s largest search and travel companies.
Building brand reputation through industry alliances can be a key move to protect existing market share, and for expansion into new markets. At this time, many consumers are re-evaluating brands vis a vis the choices they make. Consumers will align to those brands which reflect their views, and support their plans going forward. Companies considering partnership have to evaluate relationships on more than business need, but also on the overall value add to their brand.
Starbucks and Spotify classically exemplify tapping into and amplifying shared brand values. Both brands believe in the individual experience. Bringing music and coffee together was a natural fit, because every unique person has that unique mood. In the current conditions, there are new emerging needs which could drive similar shared brand values within the travel space.
Read more about the role industry partnerships can play in building customer confidence in a recent panel discussion with Cirium’s Robyn Grassanovits, VP of Emerging Business.
3. Sparking innovation
The rate of change in the industry is pressuring many companies to get creative in solving new customer problems. A third benefit from partnerships is innovating through combined knowledge and resources.
This is quickly becoming a focus in order to address some of the broad economic needs faced by governments around the world. Recently, Vietnam and Australia announced a strategic partnership to accelerate the use of AI for the economic recovery for Vietnam.
Scotland is another government seeking to support recovery through technology partnerships. The country has just announced, a new coalition to focus on innovative tech partnerships to spark growth within travel and tourism.
Key questions to ask before partnering:
- Will this partnership cannibalize existing business?
- Is a potential partner selling to a priority prospect?
- Is this partner, and deal, ethical, and aligned with corporate values?
- Does this relationship provide both organizations significant gain from working together?
- Do goals and objectives align for each party?
Choosing which opportunities to pursue can never be a sure bet. Knowing which specific customer problem to solve is a good start, though. Then, by having an idea of what benefits there are to gain, companies can explore partnership opportunities to accelerate their transformation.
See the Open Letter to Travel, for more ideas about innovating during crisis.
Read other articles about travel industry innovation here. Check out one of our upcoming or recorded webinars here.