Some observers of mobile technologies wonder if they’re killing people’s “do-it-yourself” mentality, as a multitude of apps enable users to hire others to tackle tasks for them on demand, from grocery shopping and delivery to assembling their furniture.
One area where smartphone owners apparently don’t want to completely hand off a task to someone else? Travel booking.
That’s what Lola discovered in testing early versions of its product. Boston-based Lola, a two-year-old travel technology startup led by Kayak co-founder Paul English, was betting that frequent travelers would gravitate toward a 21st century take on the travel-booking process: texting with a human travel agent who would research flights and hotels, make recommendations, help book the trip, and be on call to handle any questions or problems that arise.
But the company found that while users liked to chat with a human agent, “they were cheating on us a little bit and going outside Lola when they wanted to book on their own,” he says. “There are times when they just want to go ‘click click,’ and book their own hotel without waiting to chat with someone.”
The initial version of Lola’s product was “chat only,” English (pictured above) says, so users couldn’t book anything themselves within the app.
A new version the company announced today is a combination of self-service travel-booking tools and an on-demand “concierge” service, which enables users to chat with a travel agent when needed, English says.
The new app follows a bigger shift the 60-person company announced earlier this year: It’s now focusing mainly on serving frequent business travelers. English calls them “road warriors”—people who travel around 10 to 20 times a year for work. Business travelers made up around a quarter of Kayak’s users over the 10 years that English was the company’s chief technology officer, he says. Lola has seen stronger demand from that group. About two-thirds of its early users are business travelers, English says.
“We didn’t really aim at them” initially, he says.
Lola’s app is still available for anyone to use, English says. But in early testing, the company found that the average consumer didn’t want to pay for the concierge service. Lola’s shift in focus “wasn’t so much a move away from consumers. It was more like a move toward businesses because that’s where the excitement was,” English says.
Lola fits into a few trends, including the “consumerization of business software,” as English puts it—making business apps that are easy to use and look fresh, like people have come to expect from consumer technologies.
Lola is also one of a growing number of businesses powered by a combination of humans and artificial intelligence-related software. Its users can search for and book flights and hotels in the app, which uses algorithms to deliver personalized recommendations based on user preferences and purchase history. Unlike many online travel companies, English says that Lola isn’t taking payments from businesses to promote their offerings in searches.
Lola has raised $45 million from investors, including GV, General Catalyst Partners, and Accel. The startup will try to differentiate itself from larger corporate travel agencies like Egencia and American Express by offering more modern software tools and charging less for support, English says.
The company says it plans to start charging for its concierge service next year; prices haven’t been announced yet. Lola plans to make money primarily by charging airlines and hotels commissions, usually taking around a 10 percent cut of the purchases users make, English says. The startup is initially targeting employees of small businesses.
Over the past few months, Lola has tweaked its tools to cater more toward business travelers. For example, when users search the Lola app for flights, it will display direct flights before those with stops, even if the non-stop options are more expensive, because business travelers usually prefer shorter trips (and often have the budget to pay extra). Later versions of the app will incorporate more features for business teams, English says. He declined to share details, but one broad idea is making it easier for employees to coordinate travel and share information, he says.
Lola’s concierge service is primarily geared toward helping users deal with stressful situations while traveling. The company’s staff of 15 travel agents can help with booking new flights if there’s a cancellation, say, or negotiating an earlier check-in at a hotel if the person needs to shower before a meeting, English says.
“It’s kind of like having a great personal assistant focused on travel,” English says. “People are using more self-service tools. But business travelers have told us they do want someone to advocate for them, especially when they’re on the road.”
English estimates about 20 percent of users’ interactions with the revamped Lola app will involve a human worker—much lower than with the original model. That should mean an easier path to profitability, English says, since the company can serve more customers with fewer resources. But he’s still excited about the company’s human touch because he thinks it will help build deeper relationships with customers than if its service was “just pure bits on a screen,” he adds.
Another feature users asked for is the ability to book travel in the app, but still earn rewards through loyalty programs, like frequent flyer miles and hotel points, English says. Many business travelers have a dozen or more travel apps installed on their smartphones because if they make purchases through travel search firms like Kayak or Expedia, they don’t earn rewards points, he says. The goal with Lola is to have the best of both worlds—a meta-search app that consolidates their travel apps into one, but still earns them the benefits of booking directly with hotels and airlines.
“It’s a better experience for the traveler, and it’s much better for the hotels,” English argues. “They have a love-hate relationship with sites like Expedia. … Hotels like the [additional] traffic, but they don’t like that Expedia tries to own the customer and tries to do cross-selling and up-selling.”