Friday, June 29, 2007

Easy does it with online packaging and cross sell

easyJet announced today the launch of easyJet Holidays with the hotel section being powered by First Choice's Hotelopia. Here is the Travelmole article and the confirmation of Hotelopia's involvement.

An airline doing a deal with a hotel provider is nothing new. In fact we have seen great twists recently with Singapore airlines finally agreeing that they needed outside help with hotels by signing with GTA's Octopustravel and Ryanair signing up with the "undead" white label arm of Expedia (called World Wide Travel Exchange or WWTE). The difference here is the the quality of the integration.

I spoke recently in this post on what airlines need to do to stay on top in online travel. My number one suggestion was to focus on cross sell. Crucially to not treat hotel partners as a simple white label relationships or an ad sales deal where all the airline focused on was the size of the commission cheque at the expense of functionality, choice, price and all the other things that are important in building customer relationships. Pure white-label deals leave open a functionality and convenience gap that online agents (OTAs) with decent screen scraping/API connections and packaging technology can fill. Airlines that did not participate in the GDS had a presume insurmountable advantage over OTAs as the OTAs had no access to inventory. Now that aggregation technologies have found ways around the GDS non-participation, this advantage is disappearing. Now it is smart OTAs that can have the advantage as they can package and cross sell where airlines with dull white-label arrangements cannot.

The easyJet integration is a great step in maintaining the advantage over OTAs. I searched a random flight from Luton to Edinburgh (June 30 out, 7 Aug back) on both the site and the easyjetholiday site. Through the cross sell on the "regular" site after I searched for flights and the full holiday functionality of holiday site I received the same offers at the same prices. The process was seamless and matched the experience of booking through an Expedia or Orbitz (though I did not complete the booking so have to assume that all goes well once credit cards are entered).

This focus on product, experience and price is in contrast to Ryanair who have no cross sell and have done little to alter the look of their WWTE product other than header, footer and colours.

Congrats to easyJet on this launch.

Am not predicting the death of,, and other big traffic airlines sites that have not embraced product focused cross sell but will predict that for so long as these airlines take a casual attitude to complementary products they will be providing market opportunities for the online agents they hate so much.


Anonymous said...

hold the applause dude,
try to book a holiday London to Greek island. clicked on the hotel and get a Computer ERROR... not all is what it seems

Anonymous said...

good points allround and not an unsurprising move from easyjet considered this was clear to the market when they did the last RFP. What is interesting is that they are moving hard and fast into the packaged market - where the hotelopia ownership is very active. who build their DP technology?

Tim Hughes said...

Good question - anyone out there know?