How Agoda's CEO Omri Morgenshtern is pushing boundaries far beyond its home turf #Phocuswright
Summary
In this fireside chat at Phocuswright, Agoda CEO Omri Morgenshtern speaks with Siew Hoon Yeoh of WIT and Northstar Travel Group Asia about Agoda's strategic direction, the role of AI in travel, and the company's ambitions beyond its Asian home market. The session marks a historic moment as the first time in Phocuswright's 30-year history that the conference opens with an Asian travel brand.
Morgenshtern addresses the much-discussed narrative around the potential demise of OTAs in an AI-driven world, firmly rejecting pessimism. He argues that AI represents a golden opportunity for OTAs to 'move up the funnel' and become the new travel search engines themselves — replacing dependence on Google and other search platforms. He notes that the technical and financial barriers to building this capability have dropped dramatically, and Agoda and Booking Holdings are actively investing in it. He predicts that within two to seven years, the user experience in travel search will be fundamentally different, led by OTAs.
On the question of which consumer problems AI should solve, Morgenshtern deliberately steers away from the 'sexy' topic of AI-powered trip planning, arguing the more impactful and underserved pain points lie further down the funnel: cross-border payment friction, foreign exchange anxiety, access to financing for travel expenses, connecting room bookings, and handling things that go wrong mid-trip. He frames trust as the ultimate currency — one bad interaction loses a customer, while solving these pain points earns lifetime loyalty.
Regarding Asia specifically, Morgenshtern explains that Asian markets are more complex and fragmented than Western markets, requiring entirely different solutions for Japan, China, Indonesia, Thailand, and India. He acknowledges Asian consumers — especially the large wave of new, young travelers entering the market — may adopt new AI features faster, but stops short of predicting Asia will 'leapfrog' the West in AI adoption, suggesting it will likely happen everywhere simultaneously.
Morgenshtern shares that Agoda's own internal study found 95% of developers across Southeast Asia and India are already using AI — a near-universal adoption rate in back-office operations. He draws a distinction between back-office AI (where the case was always obvious) and consumer-facing AI (where changing ingrained consumer behavior requires delivering dramatically more value, not just incremental improvement).
On product philosophy, he stresses that the solution to AI-powered travel discovery is neither purely conversational chat nor purely improved UX — it is a hybrid that nobody has cracked yet, and Agoda is running thousands of experiments daily to find that answer.
The conversation closes with Morgenshtern's long-held prediction that OTAs will increasingly resemble banks, particularly given the enormous fintech infrastructure already operating inside OTAs (payment optimization, FX management, loyalty schemes). He sees OTAs as the ideal distribution layer for financial products tied to travel expenditure — loans, savings, FX hedging — and believes this convergence will accelerate globally, not just in the US loyalty-driven market.
Key Takeaways
- •OTAs should view AI as an opportunity to become the new travel search engines, reducing dependence on Google by owning the full funnel from discovery to booking.
- •The most impactful unsolved consumer problems in travel are not trip planning but lower-funnel issues: cross-border payments, FX fees, connecting room bookings, and mid-trip problem resolution.
- •Trust is the most critical OTA asset — a single bad interaction can permanently lose a customer, making reliability and problem-solving more important than feature innovation.
- •Resist the temptation to build for hype; systematically identify and solve real consumer pain points one after another rather than chasing what 'looks good.'
- •Consumer-facing AI requires delivering dramatically more value (not just incremental improvement) to change ingrained behavior — be willing to experiment but set a high bar before broad rollout.
- •AI-powered travel product design requires combining conversational AI with UX innovation — neither chat-only nor UX-only approaches are sufficient on their own.
- •Asian markets require distinct, localized solutions for each country — the same product that works in Japan will not work in Indonesia or India, which makes scaling innovation harder but more defensible.
- •OTAs already operate as large-scale fintech companies internally; the next strategic move is to expose that infrastructure externally and partner with or compete against financial institutions.
- •Holding strategic direction steady under competitive pressure ('holding the line') is as important as the ability to pivot — stay the course when the strategy is sound.
- •The wave of new, young consumers entering travel in Asia makes the region particularly receptive to new AI-driven features, even if it won't definitively 'leapfrog' the West.
Transcript
[laughter] we have to bring a bit of Thailand to to San Diego. So, good morning. And Sawika Omry, great to see you. And uh so you know in Asia how we like to change things up, right? I think and so instead of ending the session with this game of cards, we're going to start with it, right? And watch how I shuffle. Would you like to cut the cards? >> Sure. >> Okay. >> Do I get to bet? >> Yeah. Then pick one. and then answer whatever question is on the card. Okay. >> The one thing I've been waiting...
