1. Forecasting -
Does it still
work?
EyeForTravel
November 29, Prague
Kate Varini, Oxford Brookes
Larissa Koupriouchina, Hotelschool The Hague

2. How many twists?

3. How many twists?

4. Uncertainty is
different

5. Uncertainty is
different

6. Black swans
are on the
increase
See the video clip here
http://www.youtube.com/watch?v=BDbuJtAiABA

7. Speed of transactions

8. ❖ Mobile web access from smartphones
will surpass traditional PCs by 2013
(Gartner Research)
❖ 1,200 % increase in 2011 of travel
category searches via mobile device
2011(Google)
❖ 3,000 % increase of hotel searches
on Google Maps (Google)
❖ Mobile bookings are expected to
exceed $160 million during 2011
(PhoCusWright)
Speed of transactions

9. Flash sales are moving from niche to mainstream
distribution channel

10. Low cost competition

11. Budget hotels in top 6 Chinese cities

12. Increasing population

13. Climate change

14. Traditional segmentation doesn’t work

15. Traditional segmentation doesn’t work

16. Managing
complexity
• Signal detection
• Contingency planning
• Managing black swans?

17. 5 Top Lessons from
forecasting research
1. “Simple” models do not
necessarily fit past data
well but predict the future
better than complex or
sophisticated statistical
models.
2. Both statistical models and
human judgment have
been unable to capture the
full extent of future
uncertainty.

18. 5 Top Lessons from
forecasting research
3. Expert judgment is typically
inferior to simple statistical
models.
4. Forecasts made by experts
are no more accurate than
those of knowledgeable
individuals.
5. Averaging the predictions
of several individuals
usually improves
forecasting

19. Judgmental forecasting
Conventional wisdom Empirical findings
The amount of information does
The more information we have, not improve the accuracy,
the more accurate the decision instead it increases the
confidence
Monetary rewards and Human behavior is too complex
punishments contribute to better to be motivated by monetary
performance factors alone
In many repetitive, routine
Experience and /or expertise decisions, experience and/or
improve accuracy of decisions expertise do not contribute to
future-oriented decisions

20. Forecasting by
experts

21. How to deal with