Skyscanner pivots from original model, becomes marketplace with bookings

Skyscanner is introducing what it calls a "marketplace" approach to the business, ending 17 years as one of the most successful search engines in online travel.

The U.K.-based company insists it is "not becoming an online travel agency" - instead, it is offering a three-pronged approach to connecting users with air tickets.

Still, crucially, Skyscanner will now become the merchant of record for air bookings for the first time as part of its shift away from the metasearch-only model.

Starting with flights and only on the brand's app and mobile website, users will be offered three ways to purchase their air tickets when they are shown search results.

One option will be to book with Skyscanner, with the company handling customer service, securing payments and taking ownership of all of the ticketing logistics for passengers.

A second method will be to secure the fare through its existing direct-booking service, where it handles the payment on the site but the airline or online travel agency partner continues to own the customer and be responsible for tickets.

The original metasearch model has not been banished completely, with a third option being the traditional list of partners that a user is passed over to online in order make the booking.

Speaking to PhocusWire this week ahead of the announcement, Skyscanner's CEO, Bryan Dove, who took over the reins from co-founder Gareth Williams in May 2017, says the major shift in strategy was "inspired" by its parent company Trip.com Group, which bought the company in November 2016 for $1.75 billion.

The Ctrip brand in China had used a similar strategy for some of its flight bookings, so Skyscanner has leveraged some of that technology, Dove says, to "move us faster to market" with the product.

Business and user experience decision

One of the reasons to move away from the old metasearch-only model, despite the introduction of a direct-booking facility a few years ago for some airline partners, was the continual frustration that many mobile users have with being offloaded to the partner site to secure the booking.

Dove says the marketplace-style platform (in the works for a couple of years) is a "necessary transition" for Skyscanner and that, in reality, often consumers will not care where the flight is secured, as long as the customer service is watertight and the ticketing and payment are handled efficiently.

But he believes only a few brands in travel have the "scale and influence" to introduce such a system that essentially "removes the pain of meta."

Dove says online travel agency partners will be participating, despite not being the merchant of record, including its mothership's core brand Ctrip, as well as JetMax, CheckMyFares and three others by the end of the year.

A small group of users in Singapore have been able to trial the new platform since May this year, with Australia added in June and another small, logged-in subset in the U.K. from last month.

Other English-speaking markets are next in the roadmap and then other countries are expected to be added over the course of the next 18 months, Dove says.

Although the introduction of the marketplace is initially only for flights, Dove says hotels and other products could feature further down the line. It may also be extended to the desktop website in due course.

It is hoped the ancillary products that are often only available on the airline's website (seat selection, meals, upgrades, etc.) will also be included by way of NDC-led connections in the Skyscanner booking path.