we apologise but the audio/video system on this flight is not working and has had to be shut down
to build a tourism website where people can book rooms in New Zealand's hotels, motels, campgrounds and other accommodation.There is some blahblah in the press release about how this will be different to Wotif because it will target "ordinary kiwis" while Wotif is focused on businessmen. Don't believe it. Assuming the site is launched this will be an old fashioned battle between an established brand leader (Wotif) and a new entrant that hopes to push traffic from one form of ecommerce to another. At this stage it is clearly - advantage Wotif.
Expedia AU is now the "official online agent" for the Sydney Swans (who - for my international readers- play a type of football only played in Australia). Part of the deal is Expedia branding on the football at home games introducing almost a world online travel first of pay per kick. Is not the first time Expedia AU boss Arthur Hoffmann (seen here with Sydney coach Paul Roos) has been active with an offline branding campaign (you will recall the lovely ladies in lemon). It is also not Expedia's first foray into kick based sports 
sponsorship. For a period around 2002 (and maybe longer) Expedia was a mat sponsor of the brutal sport of Ultimate Fighting Championship. As you can see from the image, left that was pay per kick, smack, wack, hack, twack and break your back marketing at its finest."The VOD was working perfectly, the seat was great, the product is not that bad"It turned me to thinking about why I am so tough on Qantas and a realised the answer. It is not because I do not want to fly them. In fact the contrary is true. I have previously and would again rank them as my number 4 preferred long haul carrier (though I have not flown Emirates or Virgin Atlantic). They have a very good product. The seats good, the food among the best in the sky and the lounges great (especially the showers). My problem is not, "do they have a good product", it is "the product is not as good as they say it is". Service industries are about delivering to the expectations you set. I am annoyed and angry with Qantas because they say that their seat is the biggest in its class, the VOD system the best, the service the friendliest, the pillows the fluffiest, that devaluations of frequent flyer miles are in my best interest and that their focus is purely on its customers when the truth is that Cathay, Singapore and BA beat them on all those functional fronts and that cost cutting and efficiency are the number one thing on their mind not service.
"There is no place in the world any more for travel agents....Expedia's Dead" (in a fantastic Irish accent)I assume the Dead pay cash....
Picture the scene: you walk into a clothes store, and quickly spot the perfect Friday night shirt. You look at the price – 19€ - perfect. You take it to the counter, the check-out guy/girl scans it, then says, “that’ll be 25€ please.” You look at the check-out guy/girl quizzically, smile and point at the price on the ticket, to which they answer, “oh, that is the tax-excluded price.” Personally I would either ask for the manager, or more likely walk out of the store in disgust.
I am used to a tax-included price in the store. I am not used to waiting until the last minute until the final price is presented to me. I am not, ever, going to buy a hotel stay at Booking.com for exactly this reason.
Booking.com doesn’t include a tax-included price in its website, even at the point where the customer is adding their credit card details to the page. In fact, Booking.com is not alone in this practice. Many hotel aggregators quote tax-exclusive prices, at least in the first step of the purchase process.
So then, back to the original question. How does the humble hotelier, hoping to get some 0% commission sales through their own website, price the stay, especially knowing that the same room is appearing on their distributors sites without tax included? Do they make me happy and provide a fully inclusive price, or accept that their wannabe customers are actually shopping around and finding (very unclear) tax-exclusive prices on their resellers websites?
Their appears to be two forces at work here. Legality and profit.
Dealing with profit first, the decision appears to be a difficult one. Does our hotelier risk customer dissatisfaction after the purchase when they realize that the price has changed for the worse (and risk a cancellation perhaps), or risk not having that customer at all?
It might be that this issue is best answered by looking at how the hotel resellers are displaying prices and thus understanding better what the customer sees when they are shopping around. I did a little research and there appears to be three main ways of displaying prices:
The following is a list of the way that some of the popular travel sites display hotel prices
| Site | Display on 1st results page | Full price quoted at point of credit card |
| Per day prices without taxes, total on results page taxes and charges included | Yes | |
| Tax included | Yes | |
| Tax included | Yes | |
| Booking.com | Prices without taxes | No |
| Prices without taxes | No prices on this page | |
| Tax included | Yes | |
| Prices without taxes | No |
Three of the seven sites I looked at don’t even quote the final price payable on the page where the customer adds their credit card details. It looks like Booking.com, HRS and Ratestogo don’t really mind the negative feelings that could occur here. Perhaps then customers don’t have a negative feeling in this case.
For most hotel websites the fact is that if their rooms are displayed on any of the tax-exclusive sites then they might be better quoting tax-exclusive rates, at least initially. This would at least lead to a level playing field where comparison shoppers are concerned. It might increase conversion rates, and reduce distribution payments also. What is also clear is that pricing, regardless of the tax issue should be clear about what is included and what is not.
So what about legality? Legal or not, it appears that some large organizations with deep pockets are operating a tax-exclusive pricing policy. Perhaps then hotels shouldn’t be worried about the legality as long as far more visible websites are practising this.
UPDATE - Some nice friends and others have rightly pointed out that often the tax pricing situations I have described occur in countries where taxation is more difficult to deal with. My market of interest is Spain, and for Spain all the information written above is true. For other destinations it may not be. However, having worked for many years with the development side of online travel I have to mention that not correcting this problem is less because it is impossible to solve, but because a high enough priority has not been assigned to solve it. Let’s hope in time that common sense prevails and clear pricing practices are forced on all travel vendors.
"to give shareholders more time to review disclosures that it made to the Securities and Exchange Commission March 19."It is strange that Sabre is making disclosures so late into the process and therefore risking the possible negative perceptions that comes from a delay in the vote. From the Travelweekly report there does not seem to be anything peculiar in the disclosure but the rumour-monger in me finds it strange that it happened at all.
"[to help] business owners raise the financial performance of their travel, tourism and hospitality assets. Through the execution of bold ideas.."Not exactly sure what that means - sounds like a mix of consulting services, capital raising/corporate advisory work and corporate planning. More details here. It is great to see that team back together and will keep an eye on the PR wires as their client list developments.
I had a very interesting conversation a week or so ago with the CEO of 2.0 start up Travelgator - Chris DeBrusk. Travelgator is a two year old company, their site came out of beta in August 2006 with their major release hitting the cyberways early last month (Feb).
Like a lot of the new travel services companies Travelgator are looking to build a community around travel – around helping people find out what they want to do next in travel and help them draw on the experiences of other to decide. More on the company and how they are trying to differentiate themselves from the pack in a latter post - first, the prospect of speaking to Travelgator turned me to thinking about the market history that has led to this new wave of travel companies and what inherent needs they have for success.
In thinking through this I thought back on the phases of online travel - I decided there have been three broad overlapping phases.
Phase 1 (1995-2003) – I know where I want to go, find me the cheapest price.
Expedia, Travelocity and (the subsequently acquired) Preview started the market by turning the green screen around and giving early Internet uses access to travel agent booking processes. This made visible the dark art of booking travel. The low cost carriers followed quickly as did start ups on other locations such as Lastminute in the
Phase (2000-2006) – I want to find a deal on where to stay, can you help me with rates, availability and advice.
Expedia buys Travelscape (and eventually HRN) and the merchant model goes mainstream (by the way good Expedia history here). Soon everyone is contracting directly with hotels, a pace that accelerates as the hotel industry tries to recover from the horrors of 9/11, SARS and more. TripAdvisor (soon to also be part of Expedia) adds the next piece to the puzzle with the power of group based recommendation.
Phase 3 (2005 – now) – what do I do next, where should I go next.
A global audience that has travelled, enjoyed booming economies and is comfortable sharing everything and anything with a keyboard and mouse, has bought the wisdom of crowds mantra and wants to know what the world knows. Out of this comes social networking in TripAdvisor, investments in WAYN and start-ups like Travelgator.
I remember meeting in 1999 the founder and members of a company called TravelDonkey. Now little more than a traffic page – at the time the business model was to capture the experiences of travellers from the entire world and share them. People would be able to write in with their trip notes in real time. Search and matching algorithms would match like minded travellers and enable them to interact and build community. The CEO of the time (Sally Meecham – side note I had forgotten Sally’s last name but Googled “Sally Travel Donkey” and naturally found it) shopped this story throughout
The big question for Phase 3 (and something I will discuss in the context of Travelgator in a later post) is - when does the provision of options, choice and possibilities confuse customers. In Phase 1 and 2 I sat through usability labs and customer surveys that showed that the more choice you gave a customer through buttons, links, options etc, the less they did. There are famous surveys in old school retail proving that a point is reached when you give a customer so much choice that they choose nothing. Each of the phase 3 business models therefore have an near impossible challenge – how do you provide choice, how do you meet the need from the consumer to find out “what to do next” without either providing too much choice or (to go to the other extreme) targeting in on a niche that is so small or focused that there is no money in it. Don’t know the answer but am looking forward to thinking on it more, watching others and finding out. What do you think?
Will target this thinking in tighter with comments on Travelgator soon.
