The impact of electronic commerce on the travel industry an analysis methodology and case study

Abstract

We introduce an approach to analyzing the impact of electronic commerce on an industry, and describe how industry players can devise plans to take advantage of new business opportunities. We elaborate on this approach in the context of the travel industry. We draw on our work on classifying technologies used in electronic commerce, the business value of electronic commerce, and a current research project on the impact of electronic commerce on the travel industry. The paper includes a review of the business drivers (pull) and technological advances (push) in the industry; an analysis of the impact on the competitive structure of the industry using Michael Porter's (1980) framework in the context of electronic commerce; an analysis of the capabilities of the different actors and how electronic commerce will allow them to improve, transform or redefine them. This leads to a cross-analysis of the possible strategies for each actor in the industry, based on the available and planned technologies (focusing again on electronic commerce). From these strategies, one can derive the need for technological support (infrastructure and systems) and the organizational impact for each actor. This should be helpful in assisting industry actors to develop their electronic commerce strategies. The case study examines issues related to the management of travel distribution for leisure and corporate customers, and will especially study the reaction of travel agencies, computer reservation systems, product suppliers (e.g., airlines and hotels) and customers.

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