And this time, Asia will set its own pace and rules  

A weakening global economy; rising fuel prices; inflation; changing travellers' habits in how they shop and buy, consumers' environmental concerns, destination "fatigue", technological advancements, the increased hassles of travel … the list goes on.

Certain analysts are calling it the "perfect storm" to hit the travel and tourism industry. They said that too after 911, remember?

I recall Barry Sternlicht, chairman and CEO of Starwood Hotels & Resorts, after he accepted the Innovation award at HICAP (Hotel Investment Conference Asia Pacific) 2002, saying, "Terrorism, the economy and war – and now we hold our breath for Iraq and a resolution to the Al-Qaeda problem."

(Right Yeoh Siew Hoon)

Well, we all know what happened then.

Then too, the world was a lot more US-centric. The two sleeping giants of Asia, China and India, were still in slumber. When America sneezed, Asia caught pneumonia.

Is the perfect storm today different from then? Will Asia be dragged into the maelstrom or will it be able to hold its own? How will Asia's travel and tourism ride out this latest wave of changes and challenges to come out of the other side, dry and mighty?

There are many who say Asia's travel industry is at a critical stage of its evolution. Built on the back of a prosperous West, at a time when destinations in Asia were the exotic playgrounds of the rich and famous, and the not so rich and famous, consumers of the West, products and services were developed that catered to Western tastes.

Asian airlines took the best out of Western practices and added that extra twist – Asian service and hospitality – something that still holds them in more superior stead than their Western brethren.

Western hotel brands which came to Asia brought their processes and systems and again added that extra twist – Asian service and hospitality. That combination has led to some of the world's greatest hotels being found in the region.

Destinations scrambled to project images of the Asian smile, pristine beaches, exotic islands, golden sunsets and natural rainforests to an easily-enamoured Western consumer.

A supply chain developed around these three main drivers. Consolidators, tour operators, travel agents, ground operators – each added their own value to the chain. The consumer was then clearly at the end of that chain.

Well, the world is a different place today.

Nearly three-quarters of all travel to Asia is intra-regional. It's neighbours visiting neighbours. More than half of all visitors to Hong Kong come from China. The same scenario is repeated in Macau – who do you think they are building all those mega casinos for? Out of Singapore's 10.2 million visitors last year, more than 7 million came from South-east Asia. Who do you think it is building those two Integrated Resorts for?

Is the new demand begetting new supply as well as new distribution channels? Ish.

Malaysia's AirAsia led the way in allowing everyone to fly. Now it is hoping its Tune Hotels, with its pay as you use concept, will enable everyone to stay.

Singapore is facing a serious situation – not enough diversity in the accommodation types so that it is having to turn away badly-needed business from regional markets. Not enough mid-range hotels and not enough hotels of character and colour to cater to a more sophisticated traveler, whether from Asia or the West.

In China, the hotel group to watch is local brand Home Inns, which, as of March 31, included 299 hotels in operation, covering 75 cities in China. In its first quarter 2008 financial highlights, it reported total revenues increased by 94.9% year-over-year to RMB357.0 million (US$50.9 million).

Western brands are bringing their budget models to the table. They are also having to review their global branding template. Do brand templates set in the West necessarily work for the Asian palate?

The age of globalisation, which actually meant Western ideas and innovation implemented with cheap Asian labour, goods and services, has given way to what new pundits call global connected-ness, in which ideas and innovation can come from anywhere and anything can be made anywhere, everywhere, anytime.

For all our global connected-ness, however, travelers' needs and motivations are different. What drives Asian travelers is different from that which influences their Western counterparts.

The Japanese led the vanguard in showing the world what group travel could be like. Then came the Koreans. Now the Chinese – New York, I read, is preparing for a "Chinese" invasion.

The Asian traveller is many faces, of course, just like Americans, Australians or Germans. There are cheap ones. Rich ones. Shoot-and-run types. Relax-and-pay-a-lot types. One thing most of them seem to do better than their Western brothers and sisters before them is, eat and shop.

And it is the way they shop prior to their travels that is having one of the most profound impacts in the Asian travel landscape.

The Internet and new technology have facilitated one of the biggest groundshifts in the travel supply chain in Asia. Eager and early adoption of new technology, huge and growing Internet populations across Asia and the far more voracious adoption of mobile devices are driving the transformation of the online travel space in the region.

While traditional travel agents still rule in many markets, the shifts towards online sites have already taken place in more matured markets with Internet-savvy consumers.

Traditional tour operators now derive much of their income from online sales – ie from selling on their contracted room inventory to third party websites, a grey area frowned upon by suppliers but there's not much they can do in a fragmented and unruly market like Asia. One tour operator based in Thailand reports that 40% of his revenues come through this grey channel.

Just as the new Asian traveler is destined to transform the Asian travel landscape from the types of airlines to the kinds of hotels and the sorts of places, he or she is also transforming the Asian online travel space.

And it is no longer about Asia picking up on the pace set by the West – that if something happened in the West, it will also happen in Asia some years down the road. It is Asia setting its own pace and dictating its own terms of evolution.

Many issues will shape the transformation. The high usage of mobile devices versus comparative web-based devices – will this mean more mobile solutions? The "community" culture of Asian societies – will this mean social networking sites will have better traction here? The language diversity of Asia – does this mean a leaning towards videos and other rich content that are "universal"? The high-handedness of most Asian governments when it comes to the media and the Internet – will this mean more power to alternative media?

It is this transformation that the WIT-Web In Travel 2008 conference taking place in Singapore on Oct 21-22 will address with its theme "Ideas. Execution. Action".

It is also why this year's keynote speaker is KP Ho, executive chairman, Banyan Tree Holdings, a man who transformed an Asian family business into a global hotel brand that clearly has roots in Asia but is expanding beyond the region with its own agenda and vision. It's the other half of the globalisation mirror. 

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