The " "PhoCusWright surprise" occurs when I meet an online travel start up(s) at PhoCusWright that I have never heard of but is (are) number one in their category by some reasonable measure. Yesterday's surprise was Localyte. 
A PhoCusWright side effect that I look forward to is meeting online travel companies that I have never heard of but are number one in their category by some reasonable measure.Impressive. Surprising.Now to the challenges.
"Grabs recommendations from a 40k strong army of local experts to provide travel advice. Can be used by travel agents to advertise their location. Growing to 700k reviews in 2 years. Travelers can pose questions to locals and they will respond accordingly. The program can be used using the Global Sherpa iPhone app. the locals get a system of points and rewards to motivate the contributors. They throttle questions so people don’t get inundated. Open API so that anyone can integrate this technology into their sites."
"I have concerns about the accreditation of the local and how to be sure they are not a rep of a particular travel product and therefore biased"Sean Keener of Bootsnall via a tweet put it even more bluntly
"What constitutes a local expert? - local tour provider often times equals spammer in my experience. "For my local region (Bondi in Sydney) the number one expert on Localyte is a travel agent living in Sydney. As a Sydney based travel agent it is true that this Localyte member is going to know what to do and where to go. But there is also a commercial angle here. The challenge for Localyte will be how to balance the commercial interest of the expert with the brand pitch for providing unbiased local advice.
Here is the Localyte demo from PhoCusWright
My first post for Tnooz was on Augmented reality and mobile. In it I have a couple of videos of some great looking AR travel apps. However since I am trapped in the Blackberry world (my company uses blackberry) I have not had a chance to try out any of these for myself. That has left open the question as to whether or not the hype of Augmented Reality matches...well.. the reality of Augmented Reality.
Interview I conducted with Google's Travel MD Rob Torres at PhoCusWright has just gone live at Tnooz. We discuss online video, social media in the search stream, mobile and more. Here is the link for 1:1 with Rob at PCW.
Thanks to Josh over at hostelmanagement for pointing me to the TechCrunch article confirming the terms of the WRI sale to Hellman and Friedman for $340mm netting boss Ray Nolan some $100. More at the post titled "Boo.com owner made $100m – but not from Boo". My original post on the sale plan is here. Latest financials for the business were (according to TechCrunch)"Hostelworld was the cash cow for WRI, bringing in €18.3 million profit on revenue of €38 million from €350 million worth of transactions last year"No wonder that Nolan's co-founder Fergal Mooney looked happy at PhoCusWright last week.
In July 2004, Qantas proudly announced the launch of ReadyRooms (another announcement story here). An online last minute hotel booking system to take on Wotif, Lastminute.com.au (then owned by travel.com.au now owned by Wotif) and RatestoGo (owned by Orbitz). Then sometime around late 2006 early 2007 the ReadyRooms brand disappeared from Qantas sites. It was replaced with a generic "Qantas Hotels" brand. I noticed the brand confusion in this review post of the Qantas online hotels product.
Came across an post today called "MakeMyTrip.com: The Story of Online Travel Booking Startup" on the WorkHomeMoney blog. Is an interview with MakeMyTrip founder Deep Kalra. MMT is the biggest of the four local OTAs (other three are Yatra, Cleartrip and the now Travelocity owned Travelguru)."1. Makemytrip.com is now making $5 million in US dollars of profit this year.Other facts from the post I did not know is that MMT have 20 physical stores
2. The gross booking reached about $500 million.
3. Revenues are up 88% during the recession.
4. One-out-of-every-twelve domestic flights in India is booked via MakeMyTrip.com.
5. It sells 2,500 of railways tickets (the second largest category in travel) every day."
Another follow up from yesterday’s Travel Innovation Summit at the PhoCusWright. During the presentation I saw a lot screens and tech diagrams from innovators showing the latest in Web 2/3.0 technology. Lots of impressive looking technology touching on search, collaboration, analytics, content aggregation, mobile and more. Despite the impressive nature of the technology on display I came away reminded that technology is not enough for innovation. With innovation there is also critical need for an execution element and timing the product with social readiness for its adoption. For a new piece of technology to be capable of becoming an innovation it has to be timed to match the social movement and consumer readiness to use it (or be capable of holding on long enough for consumers to catch up). This was particularly front of mind for me because only recently we learnt about Yahoo! finally shutting down GeoCities (TechCrunch story here). A business it bought for $2.87billion. At the height of GeoCities (wikipedia here) popularity it was the number one place for user generated content and destination information. It was the blogging platform before there were blogging platforms. Countless personal GeoCities pages were set up by individuals to talk about their lives, animals, home towns, travel experiences and more. Millions of words of local content were available through GeoCities years before TravelMuse, Nileguide, Geckogo, Tripsay, TripAdvisor, Uptake, etc were a glint in an angel funder’s eye. Yet it died. Clearly not for lack of user generated content. Sean Keener of BootsnAll said at breakfast yesterday that GeoCities died because Yahoo! blew it because they did not know what to do with it. There is something in this. But another reason why GeoCities died was that it came out too far ahead of the desire for consumers to share themselves with the InterTube world. When GeoCities was at its peak in 2000/2001 the traffic was high, the usage was ok but there was no revenue model (no AdSense or equiv) and no sharing and distribution mechanisms (twitter, facebook, URL shortening). The consumer trend for writing, sharing and engaging in social commentary was not there to support the business. The product/technology was launched too far ahead of the social desire and trend to use it.
Don’t believe in this need for technology and social change to be together? Let me give you another example. In 1996 – as a young lawyer- I was excited to load PointCast as my screen saver. Without me having to click a button or search a site, news and information was pushed to me. All the information I used to have to surf around to find was coming to me in a means that was more convenient, faster and “hands free”. Everybody in the firm followed suit and downloaded the product. Then in Jan 1997 (wikipedia story here) Murdoch offered $450mm for company. While PointCast was holding out for more money network admins across the corporate world were finding their network s crashing down under the load of constant information queries. Employees were banned from using PointCast. Without complaint we shrugged and uninstalled PointCast. The critical part was “without complaint”. We liked the feature but did not need it. It was not that big a deal to go back to reading the local paper, BBC and CNN online. Within moments Murdoch pulled the bid and PointCast was later sold for (a paltry) $7mm and shut down a year later. Fast forward to 2009 and each of us has a newsreader indexing hundreds of information and news site. If companies tried to block newsreaders there would be an employee revolution and drop in productivity. PointCast was the first prototype of a news reader but socially we did not need to fight for it and did not miss it much when it left because there wasn’t enough content out there to compel the need for an aggregation product. Technology came too early for the consumers.
My point from these two examples is that when trying to innovate it is critical to focus as much on timing and social readiness as it is to focus on the technology and product. Making sure consumers are available and ready to pick up what you are building.
I talk about this in my EveryYou concept. Our ability to develop a specific and targeted recommendation of one based on the unique combination of desires, needs and interests of each individual at any moment in time is only now becoming available because of the matching of technological capability (near unlimited processing power) and consumer desire to share information and data and receive targeted advice and replies.
I have been reflecting back on the PhoCusWright Travel Innovation Summit. At this event 33 companies (start ups, established companies and entrepreneurs with ideas) pitched new products seeking fame and recognition for their innovation. The final four will go through the rest of the conference competing for the Travel Innovation Summit winner prize.
I will be twittering all week at PhoCusWright in Orlando. Follow me @timothychughes or watch hashtags #phocuswright and #pcw09.
This is part 2 of my interview with Jared Salter, CEO of time based travel discovery and inspiration company Joobili (pictured here to the right of Joobili Co-founder Tamas Gabor). In Part 1 we discussed the founding of the company including raising money in BOOT: Your site starts of with a time based search rather than destination based search. You need a lot of data to provide consumers with information on every event and activity around the world. Where do you get the data from and how do you plan to get more?
Jared from Joobili: We started off by creating it in house with a team of writers scouring the web, collecting events and writing up. We needed to do this to get us started, however clearly there is a scalability issue with approach. Now we are partnering with local tourism offices to access their content. In this area there is a big advantage is being in
BOOT: Where are you in the evolution of the product?
Jared from Joobili: Very early. We only became visible to Google in the last month as we were so focused on the front end. I am not worried about this as I feel this is pretty common with start ups.
BOOT: A challenge with a discovery and inspiration site is to decide how to balance up front searching and refinement. How much to you request from the consumer before a search is conducted versus how much to you move the consumer information collection to the post search refinement stage. I could not help but notice that in a random search I have just conducted for Nov 11-18, the number one recommended event is the Raben-Chilibi Turnip Festival in Richterswil
Jared from Joobili: It was a big internal debate and am not sure we have found the answer yet. We made the decision to err on the side of simplicity by having only a date search at the beginning. You might seem more filters on the front page in later versions but for launch we erred on simplicity with just time search up-front.
We will need a much need larger content base before pushing the filter angle and profiling. Paraphrasing TripAdvisor’s Marc Charron– when it comes to profiling “rather than figuring out who you are, it is about figuring out when you are”. Completely agree with your EveryYou idea. We are saying to the customer – “tell us when you are and then filter who you are”.
BOOT: Another challenge for a discovery and inspiration site is building customer loyalty. Getting the customer to use the product more than once. How have you through about the challenge of customer retention?
Jared from Joobili: According to Google, the online travel research process is 29 days from inspiration to book. Therefore we are planning to introduce a save search parameter. We know you want to go on holiday on a certain date – so we will let you save that search. We can then provide email notification any time a new event is added to the database. Or eventually build a recommendation engine based on that search parameter.
The next part will be integrating price into the results through partnerships with other sites. One other trend is that price is no longer the sole motivator as discounting becomes permanent. For example we have been working with Wizz air [Low cost carrier in
BOOT: What else in online travel has you excited?
Jared from Joobili: I am so focused on the discovery space that I have not thought about other areas. Everyone is talking mobile and Augmented Reality which is going to going to be great and interesting. But there are fundamental issues with online travel that we have not yet figured out and discovery is one of them
BOOT: How radical do you think the change will be in how we search and book travel online? Are the big four Online Travel Agents facing the same sort of radical change and industry shift that the offline agents faced in the 1990s and if they are not careful the OTAs could be in real danger?
Jarend from Joobili This period of change is not exactly the same [as the 1990s early 2000s were for offline]. The big OTAs will not be the innovators in the industry but have such a controlling part of the pie. Joobili can innovate the discovery process but need the big guys to make the booking. We hope we generate more interest in the discovery stage.
This will be more than just about content – as consumers have to know what you are searching for. All of these sites are throwing in content for SEO benefits but still asking consumer to type in what they want. Is not about the content it is the interface or experience to help the consumer to discover something new.
My take and summary
I enjoyed this chat with Jared. Not least of which because it was good to get a European perspective on the travel discovery market. Joobili is still in seed stage so we need to be a little bit forgiving on the “turnip” result but it highlights that there is a lot of data collection and back end refinement/recommendation work that Joobili needs to do before the product is ready for any dramatic marketing investment. I think Jared knows this. For more on the challenges in starting a content company see my 3 rules for starting a UGC business.
User/crowd generated content available through the mega review site TripAdvisor has done a lot of things to the industry. On the consumer side they arguably changed the purchase patterns by putting user generated content at the heart of the decision making process. On the hotel marketing side they generated a whole industry of review gaming and UGC manufacture. And...on the start-up side they have convince online travel entrepreneurs that there is a business model based solely on attracting customer because of users contributing their experiences, ideas, content and more is unbeatable.
As always Seeking Alpha have posted a very useful transcript of the Priceline (PCLN) Earnings (Q3). With no other source of information the performance of Priceline's Asian based Agoda.com I will keep on with my program of extracting and sharing with you Agoda information shared in the earnings call"Agoda also reported improved growth in excess of 100%, which contributed to the sequential improvement in worldwide merchant gross bookings growth from 22% to 33%. Agoda's growth rates reflect weakness in the prior period due to economic conditions and civil unrest in Thailand, and there are also signs of economic improvement in Asian markets."PCLN CEO Jeffrey Boyd on hotel numbers- asked " I think you only added 2,000 hotels in the quarter. Any reason that might have slowed down a bit?. "
"...we don't look at the absolute hotel count as defining the market. Our counts on a year-over-year basis are still up significantly. And it is still an important part of what we're doing not just internationally but here in the United States to add hotels to all of our programs, and potentially more important to make sure that we've got the right rates and availability from the hotels that do participate with Priceline and Booking.com and Agoda. That can be as meaningful to the output of the business as adding new hotels."PCLN CEO Jeffrey Boyd on competitors- asked "anything new on the competitive front that you're seeing in Europe or Asia? "
"From a competitive perspective, I think that you have heard in the conference calls of the two competitors that are publicly traded that they're very focused on the international hotel opportunity, that Expedia is making an agency product available to hotels, and Orbitz is really trying to reorient its organization to focus primarily on hotel bookings. So it continues to be very competitive out there. And we work very hard to keep track of what's going on with the competition, but we also try very hard to make sure that we're doing what we think is right for our business and not necessarily trying to map what they're doing."
"And if you look at the great results that we're seeing in Asia from Agoda and from Booking.com in its new markets, what you're seeing is that every time we enter into a new market we are doing it from a stronger position than we did in the last new market. And so it just gets us very excited about Asia and the Pacific and what we're doing in the Middle East and South America and in North America for Booking.com and the international traveler. "
