Friday, May 04, 2007

Expedia Spain, too little too late or better late than never?

Expedia has announced its Spanish launch. Expedia went first to the UK and Germany but then slowed, entering France after its competitors form the early days (Lastminute and eBookers), taking a softly softly approaches to the rest of Europe. The strategy was successesful as a lot of money was thrown by the competition in smaller markets while Expedia proved itself a winner in the UK through focus. However the question remains whether they have been too cautious and waited too long for Spain. I asked Euro online travel expert, BOOT guest editor and honorary Spaniard Michael Potts of e-interactive to give us his thoughts. Here is what he had to say...

I'm a bit confused about this post, because I don't know whether to write either:
  • The online travel market in Spain is buzzing, and at last the great bastion of online travel has come to this great country.or
  • Nothing has really happened, except that Expedia has started pushing the PPC bid levels on Google and Yahoo up as they try desperately to deliver the volume and market share that their US bosses want to see.

So, why my confusion? Well:

I have been waiting for Expedia to launch here for 2 years - it means that the market is mature enough to support their demanding targets for success, and in other developing markets Expedia has been the explosive catalyst that made the entire online travel market go crazy.

BUT there are three reasons why Expedia will have to work harder in this market than they may think

  1. Spain is different - the Spanish are more price sensitive than most Europeans and although they use the internet (a lot) to research travel, buying it online is a different thing entirely. Expedia is a lot of things but it is not cheap;
  2. The "marketing" market is relatively mature in Spain - there doesn't appear to be a lot of partnership agreements, PPC undervalue, affiliates or cheap bus ads freely and easily available. These have traditionally been ways that Expedia has quickly gained traction in other new markets; and
  3., and some very mature OTA's already exist in this market - accounted for 70% of all online travel transactions in 2001 and is still a massive player in Spain., and all seem to have steady growth and market experience and hotel-only players, and are also strong here.

Clearly its not going to be plain sailing for Expedia. Whereas in Italy, for instance, they moved early, captured some great marketing agreements and set the bar for competitors to follow, they are too late to the party in Spain.

Good luck Expedia, Spain needs you, I'm just sorry it took so long.

1 comment:

Sumitra said...

Silicon Valley entrepreneur and strategy consultant Sramana Mitra evaluates Expedia based on her Web 3.0 framework.