With a handful of publicly announced customers, the Kayak for Business Enterprise tool is taking a selective approach in bringing on new clients, Blockskye co-CEO and cofounder Brook Armstrong said during the BTN Innovate conference this week.
Built from collaboration between blockchain technology provider Blockskye, Kayak for Business and initial client PwC U.S., the Enterprise solution is in an “innovative period” where adding a large roster of clients is not the goal. When asked about current clients, Armstrong mentioned two announced by Kayak CEO Steve Hafner at last year’s Phocuswright Conference: multinational alcoholic beverage company Diageo and TripAdvisor. They also are contracting now to implement “three large global clients in a range of industries” as well as some medium-sized clients, he said.
It’s not yet the time for “hockey-stick” growth for the solution, according to Armstrong.
“We’ve really been looking for the right partners,” Armstrong said. “What we are doing is so innovative, and it’s crucial in this innovative period to pick folks who really want to change and solve these problems, so we’ve said no to a couple of folks. Over the next year, we’re really focused on the right set of customers and right partners and getting the platform globally operating.”
What we are doing is so innovative, and it’s crucial in this innovative period to pick folks who really want to change and solve these problems, so we’ve said no to a couple of folks.”
– Blockskye’s Brook Armstrong
The patient approach comes as Blockskye remains as one of the few widely publicized efforts to incorporate blockchain technology into corporate travel still standing from the days when the technology emerged as an industry buzzword. One of the more active players, Winding Tree, shut down earlier this year as CEO Maksim Izmaylov cited a lack of readiness in the travel industry to embrace the technology.
Other efforts with the technology have been more quietly put on hold or halted. HRS had been doing some work with blockchain around traveler profiles and identification authorization, but the company “made a pivoting decision in the 2021-2022 timeframe to focus on AI features and functionality,” according to an HRS spokesperson. Similarly, a collaboration between Travelport and IBM to use blockchain for hotel commission reconciliation was “paused” at the advent of the Covid-19 pandemic as “our priorities shifted to focus on the most urgent customer needs,” according to a Travelport spokesperson.
“We’re still actively working with IBM to explore AI and blockchain applications in travel, but there are no specific project details we can share at this time,” the spokesperson said.
Asked whether setbacks like Winding Tree gave him pause, Armstrong said he came into the business understanding the complexities of the travel industry and that change would take some time.
“If you are the type of entrepreneur that’s going to blame the failure on the lack of readiness [of the industry,] you should not have taken money from people,” Armstrong said. “The bar is higher than that.”
Ultimately, Armstrong said that change would come “gradually then suddenly.” Even as New Distribution Capability adoption grows, travelers will be drawn to direct bookings, so ease of servicing those bookings will remain a need, he said.
“We are very big believers that the Uniteds, the Bonvoys, the Southwests, they are going to do stuff on their app that’s never going to be in NDC,” Armstrong said. “Travelers using them in their personal travel will see stuff there that will never be in NDC. Our work is to make sure we are bringing you all that functionality back into the third-party [travel management company].”
He said he doesn’t even like to call bookings outside corporate channels “leakage.”
“Travelers do what they want; that’s just the market speaking,” Armstrong said. “People should be able to book on United or Bonvoy if they want, with policy and duty of care, and a third-party agency should be able to service it.”
With PwC U.S. as the pioneer, the company already has some numbers to hang its claims on. In a recent webinar with BTN, PwC senior manager of procurement and travel operations for the U.S. and Mexico Danielle Cavnor said the project has resulted in a 10 percent reduction in intermediary fees on typical airline ticket purchases and a 92 percent reduction in agent interactions for non-global-distribution-system bookings.
Armstrong also was asked if Blockskye was looking to work with agency partners beyond Kayak. He said Blockskye is “happy to work with any other TMC” but indicated he was seeing hesitancy from the TMCs, who he said are in a “tough spot” coming out of the hard hit from the Covid-19 pandemic and faced with a change that would require alteration of business models.
“Regardless of whether it’s tough or not, travelers want what they want, buyers want what they want, and suppliers want what they want,” Armstrong said. “We’re going to see TMCs who have the balance sheet and the right relationship with their investor and suppliers who can navigate into a new commercial model that’s more transparent, open and agnostic as far as fares.”
In the meantime, Armstrong said Kayak is a “wonderful partner” for Blockskye, and the company is “very dedicated to them.”
“They share the disruptive business model in the same way we do,” Armstrong said. “They bring to bear everything they’ve built on the leisure side. “We’ve been joined at the hip with them, and they’ve been a fantastic partner.”
