Latest / Reframe First / Matt Orrego, CEO & Co-Founder of Cornerstone | How Data & AI Are Reshaping Travel
Transcript
- Oleksij Rak: Hey guys, welcome to another episode of Reframe First. I'm Alexey, the host of the podcast, and let me welcome our today's guest, Matt O'Rego, CEO and co-founder at Cornerstone. So, hi Matt, it's great having you here. Mat Orrego: Hi Alexei, it's good to be with you as well. ⁓ I hear you're doing a lot of these podcasts and I've heard some of them, so I'm looking forward to being part of these. Oleksij Rak: Awesome. Thanks a lot for joining. So from what I read and learned about Cornerstone, you kind of solve complex business problems for travel industry. And you step in at the moment when like ⁓ buyer might purchase and then there is a lot of data post purchase. And that's the place where you step in and help big businesses and like hundreds of big businesses to. Mat Orrego: Mm-hmm. Oleksij Rak: manage all the data and to get more efficient, operational efficient and understand what they are dealing with. So like, is it right and could you tell us more about like what... Mat Orrego: Yeah, you yeah, you got it. You did some good research there. Yeah, so I got into the travel industry, you know, 30 plus years ago, if not longer. And, you know, got into it after being involved in financial services. And there I kind of started thinking about this whole area of data, data services and the middleware. Oleksij Rak: What? Mat Orrego: that you needed to have in order to facilitate ⁓ proper information services and to keep data in motion and to make sure that everything was well transactionally. then discovered the travel industry, which is a ⁓ huge transactional industry. ⁓ And finding that Oleksij Rak: There. Mat Orrego: ⁓ A lot of the work that we could do was around automation, automation of reservation processes, automation of the data services behind those reservation processes. And so at the simplest level, what we do is take the most complex, most fragmented areas of the travel industry and kind of figure out how to automate them, connect them, and make them make more sense from ⁓ an information perspective. ⁓ So we serve travel management companies, large corporate travel buyers, expense management teams, enterprise finance teams, because they're all looking for good information. And our philosophy is that it starts at the transaction, at the reservation level. And if you can influence that through the entire life cycle of a reservation, you can get some really good information and you can make some great decisions. Oleksij Rak: Yeah, awesome. And like speaking about your customers, what the most typical request that your customers come to you with? Mat Orrego: Yeah, our customers don't come to us asking for mid-office systems. They come to us typically with problems. And the biggest problems that they have are typically data issues. They don't have the proper synchronization of information going back into their decision support processes. In other words, their ability to provide good information internally, operationally, sometimes is compromised. It's not fulfilled. The data is not normalized. Oleksij Rak: . Mat Orrego: Often they have to provide information to their customers ⁓ in quarterly business reviews on how they're purchasing travel. So a large corporation that's using a ⁓ travel agency or a travel management company to manage their travel needs good information. They've signed contracts with suppliers. They want to make sure they're getting the best possible deal. Oleksij Rak: . . Mat Orrego: in the marketplace and they obviously want to make sure that their employees are following policy. And all of that is data and information that needs to be captured the very moment a transaction is fulfilled all the way to its storage inside of expense management systems. And we're kind of living in that entire life cycle managing, automating, capturing data. So it's really the problems. They're looking for decision support problems, good information, good reconciliation, those kind of things. Oleksij Rak: Awesome. And you raised quite an interesting topic. it's besides the customer's life cycle, it's also about your client's internal teams, how do they perform? So I've heard in travel industries for some partners of ours, like their internal teams, like sales teams or customer support teams are not performing as they expected to do. You know, the sales team needs to upsell something, but they're not. And the customer support team needs to react to some tickets, whatever like that. They need to follow certain guidelines and they are not. So is it also something you are picking up? and helping your clients with? Mat Orrego: Yeah, so at the core of our systems is a business rules management system, which is kind of the genesis to the AI world that we're living in right now, but very, very deterministic types of rules that we're applying constantly as information and transactions are flowing through our platform. And so those business rules have some very defined logic that automate messaging, that automate policy and Oleksij Rak: Yeah. Mat Orrego: compliance and governance issues. And so a lot of our customers, whether it's an internal operational need or they're applying policy to one of their customers, a lot of this has to do with properly managing that policy, seeing if the transaction matches the policy or the intended policy that a customer might have. And if they don't, maybe triggering a message or an email, now a Slack. Oleksij Rak: you Yeah. Mat Orrego: you know, message, you know, that says, hey, you know, you're in violation of this policy or these are the actions that you need to take in order to become more compliant with what the policy might be. And these policies can be financial policies, they can be operational policies, they can be lots of different kind of things. Oleksij Rak: Yeah, yeah, makes sense. It's about the data flows and yeah. Mat Orrego: It's about data flow and reacting to the data real time and being able to apply that. mean, before in the beginning, it was all about the reports and you did this analysis, but it was always an after action analysis. In other words, that month's transactions had already taken place. And then you started to see the policies that you needed to react to, but you were reacting to them 30, 60. Oleksij Rak: Yeah. Mat Orrego: days after the fact. And so now in this world where you're able to move data at the time and react to it much more quickly without this lack of latency and with wonderful APIs and integrations that we have to enterprise platforms, you can drive that kind of information a lot quicker. React to what's the problem and not have to do as much analysis. Oleksij Rak: Yeah. And like all these data flows in modern world with agentic AI, it's perfect place for some ingestion of small AI agents who can act on top of data. So it's not rule-based, it's like rather, I don't know, prompt-based. Do you also do something like that? Do you have some examples of... Mat Orrego: Right. prompt base. Yeah, I mean, that's starting to emerge. And what's interesting is, because we think about this a lot at Cornerstone, is how are these agentic processes going to apply? Because like I said, we've been very much in the business rules process, parameterized, very sophisticated, but as sophisticated as it's going to get, I think. And so it automates a lot of things. ⁓ But I think that Given that AI is a consumer-driven ⁓ momentum, that consumers now can interact with AI and LLMs, they're going to discover ways that they want to interact with the process of booking travel that are totally different from what is here today. And that's going to interject a whole new process of agentic Oleksij Rak: Yeah. Mm hmm. Yeah. Mat Orrego: ⁓ automations that I think will come less from the businesses that are the intermediaries like the travel agencies, but the requirements will get more driven from the consumer, think. Because they're going to have a totally different way of interacting with the process of buying travel and then traveling, because they'll interact with that process a whole lot different. Oleksij Rak: Yeah, for sure. We will get to that point of how consumers use agents to interact with travel providers. I rather meant when you have some data flows and the system, as you mentioned, is as sophisticated as the rules based that they build there. But sometimes you can have some external brain, like some agentic brain that based on Mat Orrego: Yeah, but I think that's going to have a huge influence on the operations of Oleksij Rak: like data signals and based on some information can act. So it's not an algorithm anymore. It's an agent. Do we try to like, because the data flows is something where, you know, it can be done. But I mean, I'm rather interested in if somebody is already doing that, like in your case. Mat Orrego: Yeah, we're starting to see that early days. Most of our focus on AIs and the AI tools and the models that we're using is very internal right now. We're making our agents, ⁓ our customer support side of what we do more efficient, more productive, being able to ingest ⁓ requests from customers a lot faster. We're also able to... Oleksij Rak: Yeah. Mat Orrego: to take requirements and automate them all the way through to technical requirements to deliver solutions faster. So our engineering team is really leveraging this. And now we're seeing with those efficiencies, we're seeing how our product managers are becoming more engineering centric. And then our engineering folks are becoming more product management centric. Oleksij Rak: Mm-hmm. Mat Orrego: And I think that that's kind of the beginning of the evolution because now we're discovering because of AI, different functional aspects of what we do as a company. And we're becoming much more effective and immersed in the problems of our customers. And I think that's what's going to really lead to our ability to provide really smart, agentic processes into the marketplace. Oleksij Rak: Yeah, yeah, for sure. Mat Orrego: Yeah, because we're kind of discovering the industry from a different angle now. Oleksij Rak: Matt, I really love numbers. Before we move on to some trends, do you have any numbers to share? How your business, your data processes and services that you are providing to your clients, how do they usually benefit the clients? How much can they gain from that? Mat Orrego: Yeah, mean, I think that what we think about from a numbers perspective in regards to our customers is the ability to process transactions on a real time basis. we're processing anywhere from 800,000 to over a million transactions on a daily basis through our platforms. Oleksij Rak: . So. Mat Orrego: Those are like new, new reservations. The travel has a way of having to remediate itself on a constant basis. There's schedule changes, there's voluntary and involuntary changes. So every one of those things, we're able to, ⁓ we acquire that reservation and we process that reservation ⁓ for different actions and different circumstances. Oleksij Rak: . Mat Orrego: So we've had to build at scale ⁓ a lot of what we've done. And so our technology is incredibly robust as it applies these business rules and these data transformations and all of this. And all of this comes from, for example, we have a product ⁓ that does benchmarking, the Cornerstone Travel Index. ⁓ It has 72 travel sellers or travel agencies Oleksij Rak: So. Mat Orrego: ⁓ If you will that are supporting 18,000 corporations that are supporting hundreds and thousands of travelers And so you see you know you see the scale of that, you know going from 72 to 18,000 to hundreds and thousands and millions of trips ⁓ And then the data that you gather from that and the automations that you have to build for that. Those those are the real Those are the real Oleksij Rak: Yeah. Yeah. Mat Orrego: numbers there because every one of those numbers, the 72 travel agencies, they're very concerned about the service levels that they're providing their customers. And so we have to automate for that. The 18,000 companies, they want to know they're spending their money correctly. So we have to provide information services to that. And then the hundreds and thousands of travelers, they're the ones on the road. They have to receive messaging real time. when something changes, when they want to make a change, what are the financial repercussions of that, all of those things. So you have this very one-to-many relationship that needs to scale the technology ⁓ for the different stakeholders in the process. Oleksij Rak: That's a big operation. About a million of transactions every single day. That's a lot. ⁓ Mat Orrego: Yeah, it is. mean, and you know, and it's, you know, it's a small fragment of the industry itself. And people don't realize in the travel industry itself has these huge numbers. But it's serviced by a relatively small community of ⁓ suppliers. There's only 200 airlines of which maybe 10 of them carry 90 % of the passengers around the world. ⁓ Oleksij Rak: Yeah, yeah, yeah. Mat Orrego: So things like that are amazing. Oleksij Rak: But what usually breaks at the operation of this kind of scale? Mat Orrego: what usually breaks. Oleksij Rak: Yeah, there's always something break. Mat Orrego: Yeah, mean, it's interesting. I ⁓ when I first started, it was relatively safe because I would I would load my software onto a stack of floppy drives. I don't know if your audience remembers what those are CDs now. And then we would ship the software to our customer. They would load it on their servers or on their computer. Oleksij Rak: I do. Mat Orrego: and it would run. then around 2000, that started changing over to hosted services. So we literally brought those computers into our data center and hosted it. And then things started migrating into the cloud, ⁓ virtualization, all of these things started happening. And so we started taking on more and more responsibility. So when you ask me when things break, Oleksij Rak: Yeah. Mat Orrego: Things break at the level of communications with the reservation systems. Things break in all sorts of things. But now we have these service level agreements ⁓ that require us to recover really fast because people are on the road. They're gonna check into a hotel. If the hotel hasn't received that confirmation, they're gonna show up and they don't have a room. ⁓ They have to show up at the airport and the reservation has been ticketed and issued. Oleksij Rak: Yeah. Mat Orrego: All of these things we're responsible for now. So when they break, bad things happen. Thankfully, it doesn't happen very often, or if it does, it's for short periods of time and we can recover. Oleksij Rak: Yeah, the world's responsibility was in my mind because the scale of operation is like millions of times daily. That's responsibility. Mat Orrego: Yeah, mean, and that's everyone, everyone pushes. Yeah, customers are just pushing all of these things away from them so they can focus on their core services and these IT services as SAS, then we're kind of doing that for them. Oleksij Rak: Awesome, awesome. That's a great operation. Congrats on that. Mat Orrego: Yeah, it's pretty fun. mean, and it's interesting because we have to really think about ⁓ the, when we have a problem, our people think about the problem technically, which they should because it's a technical issue. I remind them, you know, when things go bad like that, I remind them that it's somebody headed for the airport. They're going to show up, try to check in and their ticket hasn't been issued. Oleksij Rak: Yeah. Mat Orrego: I say, hey, this isn't just a technical database issue. We have to reconfigure something. This is a person that's potentially going to have their day totally screwed up because we didn't do our part. Oleksij Rak: Yeah, every line in database in your case is a person. Mat Orrego: Yeah, it's ultimately it's a every one of those reservations is not a bot. It's an actual person. AI hasn't started traveling yet, but I'm sure they will. Oleksij Rak: Yeah. By the way, sorry for jumping so far, but you raised an interesting topic. I recently had a discussion on this podcast with another guest, and they mentioned that the whole industry is seeing ⁓ the problem of AI agents flooding the legacy flight search with combinatorial queries. And it was never designed for that to be able to handle. instead of querying, I don't know, I want to go somewhere from my first to my 10th, for instance. User usually asks agent when it comes to agent, I want to go sometime in my end. Agent does all these combinatorial queries and the systems are not just ready for that. Mat Orrego: They're not. They're not. Oleksij Rak: And it's becoming a big issue. I've jumped to that because you just mentioned ⁓ something similar. ⁓ Do you see this kind of problem? And what do you think? Mat Orrego: ⁓ yeah. Yeah, what? It's huge. It's a huge problem. mean, it's, you know, the travel industry is not known for, I mean, it's known for its scale and the ability to do where it's gotten to, but it's done it on some very old legacy technology. And you have a lot of airlines, a lot of suppliers, you providers of travel services, airlines, hotels, you car rentals. crews, all of those, and we work with all of those, ⁓ have a lot of legacy technology. And legacy being not even on the cloud, mainframe type. Now, a lot of that has moved. But the issue of that getting moved into more modern ⁓ technologies and platforms, and now you introduce this agentic processes into it, where shopping can get done by bots and report back to the individual and say here are the options, it's creating a lot of look to book ratios. these are, so a lot of people are looking and the conversion of a look to an actual purchase is in the one to 2 % actually convert to an actual booking. So it's very, very low. Oleksij Rak: Mm-hmm. Mat Orrego: But now you have these massive agentic processes that are hitting these systems really, really hard. And the cost of distribution is starting to become a consideration because those are compute costs for them, for the airlines, for the hotels. So there's going to have to be a balance there ⁓ as well. Oleksij Rak: Mm-hmm. Mm-hmm. There will be some ballots at some point. The same as we have with tokens now in the agentic world. Tokens are becoming expensive, But I think the problem is bigger if some of these legacy systems are not designed to handle over a certain level of transactions. They just aren't. It's not a compute problem. Mat Orrego: Yeah. Oleksij Rak: problem of design of architectures that they are not designed for load. Mat Orrego: It's exactly, mean, and it's the airlines especially, I mean, but the hotel, everyone wants to have a modern retailing experience and package things. as you know, we've had these distribution platforms provided by companies like Amadeus and Sabre, people like that. I mean, and they've been in the industry as long as I have. Those were my first interfaces to the, you know, to. Oleksij Rak: Yeah. Mat Orrego: acquiring travel transactions, ⁓ but they haven't mechanically modernized in too much. So the airlines themselves have said, hey, I need to offer ⁓ more interesting packaging, a better airline retail experience that's more modern, akin to an Amazon kind of experience. But the airlines really want to make those changes and they're having to make a lot of backend changes to be even Oleksij Rak: Mm-hmm. Mat Orrego: to even have a modern kind of experience. But they're opening up their platforms more and more to these agentic processes. And I think that they're going to have to adjust as well to all of these potential interfaces, because the costs are going to be pretty high. But it's part of being in the game today now. They have to figure it out. Oleksij Rak: Yeah, yeah, for sure. Everybody is trying to adapt somehow. ⁓ Okay. Maybe next one would be, ⁓ I had a lot of discussions with people from online travel agencies, with tour operators, with people being on that side of the business, but you are on quite different side of the business. You're in data business. Mat Orrego: Well, I'm on the leisure side as well, too. yeah, ⁓ I am. I work there. There it's mostly through OTAs. So I work with companies like Expedia, for example, who are ⁓ mostly known for the leisure side of things. ⁓ But automating typical kind of things that are ⁓ more, less about corporate policy, because you don't really have too much of a policy when you, or corporate policy when you travel on vacation. ⁓ But more about the notification of travelers, the ability to provide a better experience around them and automating around those things. Oleksij Rak: Yeah. Yeah, I was rather leading to the question of you see the travel industry from data perspective mostly. I guess at least you see it much, much, much more than other companies do because they're interacting with user while you're providing data services and data intelligence services on top. How do you see that like over the last couple of years, the industry has changed? Mat Orrego: Mm-hmm. Yeah, that's true. Oleksij Rak: It did change. Everybody is telling about Gen.AI and about trade wars and about all that kind of stuff. But in terms of data and data flows, what major shifts have you noticed recently? Mat Orrego: With AI, I think the fundamentals are kind of the same. I think you have to prepare your data ⁓ and your data models in a way that are consumed differently. I think we're figuring that out. It's interesting because we're starting to work with larger aggregated data sets across our company. Oleksij Rak: So. Mat Orrego: customers, de-identified, and to create these larger data sets for consumption by agentic processes. And what we're finding is that ⁓ there are efficiencies ⁓ that you can bring to those data sets that allow the LLMs to do their jobs better, ⁓ that are more about master data management. Oleksij Rak: Mm-hmm. . Mm-hmm. Mat Orrego: and providing a ⁓ true schema description of each one of those data points and what their intent is. Things that when you produce a dashboard or provide information to a human being, that they kind of naturally are able to bring their perspective and look at the data and work through those assumptions. Well, you don't want that happening with the Jettych process. So you have to be much more ⁓ specific about some of these things so that the data itself is prepared to be utilized through AI andogenic processes. And I think that that's what we're finding, that it's a different way of acquiring and ⁓ staging that data with the right descriptors and the right tags and the right master data management around it in order for these systems to be more efficient. Oleksij Rak: . Do you see it as like potential trend or do you see this trend to right? it's something you are building up front or is it already a request from your clients? Mat Orrego: Yeah, no, it's, I wouldn't say that it's gone mainline yet. ⁓ The thing about the travel industry is it tends to be very aspirational and then it's slow to change. But we're starting to see it. mean, examples of, start with the demonstration of ⁓ Oleksij Rak: Yeah. Mat Orrego: of, for example, conversations that you can have with your data. So the ability to somebody to go in and write a prompt and receive information back. But then they want to bump that information against other kind of data like their policy or ⁓ their hierarchy within their company. And they want to know things that have to do. How many people travel to New York City? Oleksij Rak: Mm-hmm. Mm-hmm. Mat Orrego: ⁓ last year for the, XYZ conference and what was the average hotel costs for that and what should I project for next year? So it's, it's those type of things. So, so now every reservation has to be tagged with the intent of that trip for them to be able to know that it applies to next year's conferences that they want to do. Oleksij Rak: and Okay. Mat Orrego: know, some kind of forecasting on. So what you're finding is, what we're finding is that it's not as simple as providing a transaction database. You have to associate that transaction database with a lot of other information and master data in order for it to make sense to an LLM and for those kind of interactions. Oleksij Rak: Yeah, you mean like internal tools where you can do some forecasting by chatting with a bot and the bot knows that Mat Orrego: Yeah, exactly. what you're finding is that a lot of this, which is different for us, is getting done by internal teams. In other words, the internal team of these companies are wanting these data sets for them to play around with and to do this work, which was very different. So the socialization of data and information as it Oleksij Rak: Yep. Mat Orrego: works itself into companies that are standing up their own AI teams to bring efficiencies and productivity across their entire company. It's a different way of interacting and working with our customers today. Oleksij Rak: Yeah. Yeah, I've heard stories about bigger companies letting go big teams of data analysts because they were replaced by this kind of AI agents. Because instead of like... Mat Orrego: Yeah. Oleksij Rak: making the ticket and waiting for a day or two to get the report on some data analysis and report on some question, you can get it in 10 minutes, which I think is about so. you. Yep. Mat Orrego: Yeah, exactly, exactly. And so we have to prepare ourselves for that. as in any industry, I think it is to offer information so that it can get consumed ⁓ by different stakeholders and still keep in mind security, all the info sec requirements, governance, all of those things. Those are table stakes. You still have to have. Oleksij Rak: Yeah. Yeah, yeah, for sure. I recently heard from one of my guests, it's not from travel industry, but from e-commerce, kind of similar problems. They are working with data and they have all these dashboards, reports, like of all the data, but the problem is that like human needs to look into the data to be able to act on that. And what they're trying to do is some agentic approach that... agent will look into the dashboard, agent will try to identify potential issues and either file notifications, or tickets about that, or just act if it's something simple. So that's built up on top of what you're mentioning. So you're trying to make all the data agent ready, but this is like something next is like act on top of the data. Did you? experience that in travel industry from your clients? Do they want something like that? Is there a room for that? Mat Orrego: Yeah, I mean, it's interesting. I our customers, you know, are, you know, I think right now, you know, in our customer base, mean, there's really two, you know, two types of customers. There's the customer that sits on the operation side of the business and trying to deliver, you know, to their customer. And what they're asking for, I mean, from AI or from their data, you from their information services ⁓ is efficiencies ⁓ and the ability to provide efficiencies ⁓ across their operations and do so in a way that allows them to be customer service ⁓ centric. ⁓ retention is the opportunity here, I think. If you can provide a more productive, more customer friendly ⁓ service. Oleksij Rak: Mm-hmm. Mat Orrego: ⁓ do that in a way that allows the consumer to be able to do a lot of this themselves, then you're likely going to retain that customer. ⁓ And so that's what efficiency means to them. The other side of it is on the buyer side of it, whether it's the consumer or a company that's buying business ⁓ travel. And the thing that they're looking for is transparency. Oleksij Rak: Yep. Yeah. Yeah. Mat Orrego: And they're looking for efficiencies and the ability to get the best possible content ⁓ for consuming what they need to consume. And as you know, the travel industry is very fragmented. ⁓ And sometimes, know, transparency is not there because you don't know what's going on. So I think you have this real contention now with the buyers ⁓ that they don't trust the content. Oleksij Rak: Yeah. Mat Orrego: that's being provided to them and how can AI help with that? And I think that this is where this massive shopping idea is going to come about, which I think the suppliers aren't ready for if they let loose the agentic processes to go in and look at every corner to find the best possible deal. Because right now, the consumer is shopping all over the place. They're going from Expedia to Priceline. Oleksij Rak: Twitter. Mat Orrego: to ⁓ different services in search of things. And so I think what we were talking about before, this trust and opaqueness in the current model is going to cost the suppliers a bit. Oleksij Rak: Yeah. Actually, you brought two interesting topics. Probably I will name them and we will discuss one by one. First is what I'm hearing from all the intermediates in travel industry. Not the buyer side, not the end supplier, the line item owner. But all the intermediaries is first, they care about customer support because they really try hard to turn the customer acquisition funnel into this kind of flywheel that the customer returns to them. And second one is they care a lot about personalization, hyper-personalization to a certain extent, while they do not really have data. Because as you mentioned, like... customers are jumping here and there. It's not like Netflix, which you're watching every day and Netflix knows everything about you, So like, first, like let's address the first one. ⁓ So ⁓ they care about customer support and trying to retain the customer in the loop. So user AI is a threat for intermediaries. User AI agents like living on user site. that can communicate directly to the airlines that you mentioned before, that airlines are trying to expose their data to agents. If this kind of interaction between user and airline, where there are agents, like agents talking to agent, is it a threat for the intermediaries? Mat Orrego: Yeah, I think it's a threat to certain business models. I think that wherever you have an industry that has intermediaries, they provide a lot of value. when you introduce AI and agentic processes, AI is competing for human labor costs, to reduce human labor costs. Ultimately, that's what it does. So absolutely, it's a threat to those roles. Oleksij Rak: Yeah. Yeah. Yeah. Yep. Mat Orrego: that have been traditionally provided by intermediaries, ⁓ which has always been very labor-centric. Now, intermediaries also can provide a lot of, you know, can provide people as well. There's the proper insertion of a human experience in the process, ⁓ but there are just some things that just are too expensive to provide through people now that can be done through agentic processes. So I think both the business models ⁓ are challenged as well as certain roles and responsibilities that have been defined inside of service organizations in travel that are going to change and are going to be replaced. Oleksij Rak: Because like, intermediaries do not have anything defendable, so... Mat Orrego: They don't, but they do have a relationship. They do have a relationship with the customer. They do have that trust. ⁓ The fact of the matter is that ⁓ they're able to often orchestrate an experience that comes from different suppliers, an airline, a tour, an activity, vacation rental. Oleksij Rak: Yeah. Mat Orrego: And none of those activities are known by any of the other providers. The airline knows nothing about the vacation rental that that consumer is going to be staying in, but the agency does. mean, and so you can have an online experience that brings it all together. But I find that at a customer service level, it's just very fragmented. So you still need people in there to kind of connect that up. Now, I think that's going to change. It's going to become more efficient. Oleksij Rak: Yep. Yeah. Mat Orrego: But then the interactions between all of those suppliers and all those products needs to be better coordinated too. Oleksij Rak: So it's kind of like building some personalized package for the end user. And one thing that's still defendable by them is the customer support. And that's why they trying to invest really hard into customer support. Because there is always a question of what if. You can buy it like a tour, a ticket from airline. You can buy some Airbnb. You can buy whatever. Mat Orrego: Right. Oleksij Rak: what if something happens and what if things do not go right and then you need this kind of customer support that's provided by these intermediaries. Mat Orrego: Correct. Correct. Yep. No, I find it, I still find it that the, ⁓ I'm surprised at the number of travel agencies that have still ⁓ the labor that they still do. I mean, that has not materially decreased yet. Oleksij Rak: They're mine. Mat Orrego: In other words, they're still employing a lot of people to provide that post-reservation support and service. And it surprises me too that a lot of travel agencies ⁓ continue to have people on the front lines, that people still want to pick up the phone ⁓ and work with an individual to plan a special event. mean, they're not finding. that necessarily. They might do the research using AI, so they come as a much more educated consumer, but then they want that individual to plan out the details and to bring some of things together. Sometimes, I think that's an interesting hybrid there as to how you're going. Because the consumer themselves can do a lot of the research Oleksij Rak: Yeah, Mat Orrego: and then come much more prepared to say, is specifically what I want to do. Oleksij Rak: Yeah, yeah, but still people want to chat with people. That's what I'm hearing also, like again and again. So everybody's surprised. But people want to chat with people. Mat Orrego: Yeah, I mean, and I think it's great. Yeah, I think it's great people are hanging out with people still and want to work with other people. think that's a good thing. Oleksij Rak: Yeah, for sure it is. The second point was about they're trying to do this kind of hyper personalization, like building custom packages for the user and so on. But you do not really have a lot of touch points with the user. People are usually traveling two times a year and people not being loyal to the brand, because that's what happens in travel industry. Yeah, and so the brand does not really have too many touch points about the customer touching points and they do not have really a lot of information about the customer to be able to provide personalized free. Probably that's one of the reasons why travel agents still exist because they do try to build a personal relation with you and be able to provide. What do you see in terms of data? How does it play out in terms of like your clients are getting their customers? How they try to personalize or not? What do you see there in terms of data? Mat Orrego: Yeah, mean, what I'm seeing is that ⁓ the personalization, mean, look, so let's, on the leisure side of things, I think that you have personalization that is mostly driven from ⁓ either the experience that people have had ⁓ and how they like to do things. Oleksij Rak: Mm-hm. Mat Orrego: And you have a category of traveler that runs the gamut of sophistication from the person that travels locally on their vacation, doesn't go too far. And then you have the world explorers that go to places that they've never been to. ⁓ I think what our data is showing is that the consumer, the world travel is becoming more and more. Oleksij Rak: Mm-hmm. Mat Orrego: are leaving their countries more, they're going to explore the world, which I think is great. ⁓ And they're wanting to have authentic experiences ⁓ when they do this, because this is precious time. It's two weeks to four weeks out of the year that allows them to do something meaningful. They're going to invest a meaningful amount of money to do that, and they want a personal experience from that. And I think that people have kind of discovered that opportunity to be able do that. So local tourism, the ability to put together the right activities, the right ⁓ agendas around that, I'm seeing more and more of that. And I see that through transactions that are not just air and hotel, it's air and vacation rentals, it's activities, it's things like that that start showing into the transaction. On the business travel side of things, people also want personalization. The consumer themselves wants to stay. The traveler, the employee traveler wants to stay in their favorite hotel. It's often driven by loyalty. That's a preference for them. But they want to use their points to potentially upgrade. So they don't want to sit in a middle seat in the back of the plane. They want to sit in the front of the plane. And so they're going to use their status to be able to To customize that experience for themselves or even contribute some of their miles to be able to do that In those things and get upgraded at hotels because they're a gold or platinum status on Marriott or starwood whatever you might have so so personalization personalization is a big thing and we're seeing more and more of that just driving The consumer both on the leisure and business side Oleksij Rak: So you're seeing your clients are selling to their customers some packages with like personalized package, but how do they do the personalization if they do not have much information about Mat Orrego: Yeah, think the person on the business side of it, just to wrap that up, mean, you obviously have to follow the policy, but there's this entire concept, I mean, I don't like the name of it too much, called BLEASURE, where you have business and leisure being combined into these. And they're facilitating that ⁓ through the corporate travel functions. Oleksij Rak: Yeah. Mat Orrego: But obviously breaking out the expenses and costs so that the business traveler assumes their personal portion of those costs versus the business side of it. So we're seeing that even transactionally having to accommodate those kind of policies that people are traveling not only for business but also for spending the weekend or using part of their flight to go visit their kids and. Oleksij Rak: Mm-hmm. Mat Orrego: in some location and things like that. So you really have to accommodate for that a lot. Oleksij Rak: Yeah, yeah, for sure. Maybe one more. I don't know if you like monitoring this kind of data. I've been hearing recently a lot about booking windows change, seasonal trends that have shifted. Not shifted, but rather flattened. If usually people were booking... leisure vacations. Americans are usually doing that during December for the next year. Europeans, Germans are doing that on January for the next year because they are planning their next year. This year it flattened and some people say it will just spread over the year or so. Some are not so sure about that. Did you know, do you see this kind of behavior in your data? Do you even monitor that because probably this is not Mat Orrego: Yeah, yeah, we monitor, you ⁓ on that. mean, it's I think people are being a little bit more conservative, you know, if that's what you mean by flattening, ⁓ you know, that, you know, that that worst Oleksij Rak: It's to do. Yeah, it's not people buying, people no longer buying a year in advance. They are rather buying a few weeks before the trip. Mat Orrego: Correct, correct. Yeah, we're seeing, you know, in business travel, we're seeing that more and more. mean, and the numbers are showing on the Cornerstone Travel Index, we're showing no ⁓ real advantage to that, you know, to that 21 to 45 day timeframe. I mean, and ⁓ you're seeing a lot of deals come to bear a lot closer to the travel date. And I think that certainly I'm seeing that on the business travel side of things and starting to see it in advanced bookings as well too, that you don't have ⁓ those big year-long booking windows like you used to. But I mean, you still do. I mean, you still have consumers that are going to plan that far out, but I think you have a lot more impromptu ⁓ kind of purchasing going on. Oleksij Rak: Yeah. I heard from few businesses and some of our partners also that it has changed this year a lot. this year's behavior of booking for a year in advance, it's not there anymore. some people think it will come over during the summer season or something. Others are just freaking out. Mat Orrego: Yeah, no, it's true. mean, and the travel industry kind of tends to lag a little bit ⁓ because again, especially on the leisure side of things, it kind of counts on that advanced traveler there. But we are, we're definitely seeing a little bit of a change there transactionally. And on the business travel side of things too, we're seeing a little bit more conservatism around kind of known events, large events and things like that. Oleksij Rak: Yeah. Mat Orrego: that people aren't advanced booking some of those as well. Oleksij Rak: aren't conservative. People are booking last moment, they are booking upfront. Mat Orrego: Yeah, mean, a little bit on, I think a lot of people are just adjusting to, you know, to the needs that they have, you know, less, you know, especially on the business side of things. ⁓ Certainly, I mean, post COVID in business travel, ⁓ a lot of that is now being done via Zoom interactions ⁓ and more and more meetings because of people working virtually, bringing together teams. tends to be a lot more group travel. Oleksij Rak: Yeah. Mat Orrego: than more of that traditional transient travel where someone would go to a city and visit a bunch of customers. That tends to be less now. Oleksij Rak: Yeah, yeah. Awesome. I'm kind of out of questions. Yeah, I can bring, but still, that was really interesting discussion. I'm a big fan of data and you work a lot with data. So I was really curious to check the difference, like serious about what's happening in terms of in travel. Thanks a lot for this discussion. Mat Orrego: Yeah, yeah, no, that's fine. Yeah, well, you know, it's the main... Yeah, absolutely. Really enjoyed it, Alexia, as well, too. And I agree with you. Data drives a lot ⁓ of the success of this industry and certainly will in the future. But I appreciate the time here with you today. Oleksij Rak: Yeah. Yeah, me too. Before we wrap it up, is there anything else you would like to add on top of what we discussed? Mat Orrego: No, not really. I think we covered a lot of really good topics. Oleksij Rak: Awesome. Then thanks Matt a lot for joining, for coming and for sharing all these ideas and discussing the trends in the industry. Mat Orrego: Great, thank you, Alexei. Look forward to doing this again sometime soon. Oleksij Rak: Yeah. Yeah, for sure, for sure. That's a great discussion. Have a great time. Mat Orrego: Great, thank you. All right, thank you. Oleksij Rak: Yeah, thank you.