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5 trends to watch in online travel

Posted by simon ashwin On Wednesday 21 Feb 07

A couple of key learning points I picked up at the Amadeus Horizons 2008 conference held in Bangkok on travel distribution.

1. It’s about servicing, not selling online

John Lonergan, general manager-direct channels of Qantas, said that online had become more about servicing than selling for his airline. He said there were hidden costs in the online channel and the biggest single cost of sale on Qantas.com.au was call centre charges.

“It is better for us not to sell online but to service online.”

What’s working in the online channel? Loyalty programmes. Up to 80% of redemptions are booked online, said Lonergan.

“Servicing online is not about reducing costs – it’s about the right content to the right customer at the right time.”

In the end, he said, “Some will book direct, all will fly.”

2. It’s about being personal, and being everywhere

Last year, BA generated 1.5 billion Euros in direct revenues from its website. Up to 38% of passengers in the UK book online, compared with 27% of passengers globally.

Carsten Willert, general manager, E-Commerce, BA, said its Executive Club had become a 100% online programme – a one-stop shop for selling, servicing and loyalty.

Features BA is working on – personalization, dynamic packaging – allowing BA to earn ancillary revenues (there’s that word again) and customers to book non-airline products, enhanced redemption capability.

And ba.com, he said, wants to be everywhere – gadgets, mobile, the works.

3. Low cost may be here in Asia but Asians still want some level of service...

travel websites get personal

Posted by simon ashwin On Saturday 27 Jan 07

It’s not just about the price. As the hint of summer vacation emerges on the horizon, wanna-be travelers begin sifting through travel guides, both real and online, to concoct just the right vacation getaway. Price matters hugely, especially for travelers heading overseas with anemic dollars. But just as important is getting the best value out of a trip.

That means before they plunk down thousands on a trip, travelers are craving real reviews and recommendations from others who have been there, eaten that. And online travel companies are snapping to attention.

A flock of relatively new online travel companies offer myriad ways to compare airfares and hotel rates and of course, book reservations. Others are promoting unpolished–and unvarnished–reviews contributed by fellow travelers. Still others promise to help keep us organized.

You can call it WebTravel 2.0–or you can just pull out what you need to plan your vacation.

“The influence of social networking and community services is growing significantly for online travel,” says Douglas Quinby, senior director of research at PhoCusWright. “Seeking information and looking for perspective–like-minded experience and judgments–are currently trumping the straightforward hunt for the best price. Services that facilitate a purchasing decision by aggregating or filtering content make [online travel information] relevant to the user.”

Online travel companies, including Travelocity and Expedia, are now some of the oldest Internet brands. But they’re buffing up how they serve vacationers by acquiring social networking sites that focus on travel. Travelocity’s parent company, Sabre Holdings, acquired social travel site IgoUgo in 2005. The following year,...

the future of the online travel industry

Posted by simon ashwin On Wednesday 10 Jan 07

The online travel industry is one of the most competitive of any that I think exist online or offline today. In a market previously dominated by two or three players, the rise of travel aggregator sites such as Kayak and Sidestep has made travel an even greater price-driven commodity. These aggregation sites are increasingly becoming a first point of call for experienced online travel deal seekers looking for the best deals on airfare, hotels, and car rentals. Despite efforts from the big three (Orbitz, Expedia and Travelocity) to bring out enhanced content (often through partnerships with content providers like Frommers), the majority of site visitors are still task oriented and highly price conscious.

Adding pressure to these OTAs (Online Travel Agents) is the growing prevalence of low price guarantees which have been announced by most large hotel chains, including Hilton, Marriott, and Starwood -- which are taking hotel bookings away and leaving only airfares and car rentals (both lower margin). As a result, the opportunity for any of the many competitors in this space is increasingly concentrated in two areas:

Corporate travel (exclusive deals, recurring sales, full price tickets, etc.)
Package deals (last minute deals, book everything at once, specials)

The big three know this. Each has last minute deals (sourced through Site59 - one of the few successful online travel models out there) and dedicated corporate travel areas. Yet amidst all these challenges, there is hope in the fact...

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