Tim Hughes puts the boot into the highs and lows of the online travel business (with an Australasian/Asian bias) with some blogging about consuming and loving travel thrown in.
Friday, June 29, 2007
Easy does it with online packaging and cross sell
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 easyjet.com 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 Ryanair.com, Qantas.com, Virgin-blue.com 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.
Thursday, June 28, 2007
Seven hours on the tarmac in seven minutes
No excuses Delta - none at all.
Wednesday, June 27, 2007
301 not out
My thoughts in the last 100 posts have been mostly around branding and loyalty in community and page view based models (so called Travel 2.0) and in the Generation Y consumer:
- First broke down online travel into three phases - "Find me a cheap ticket", "help me with a hotel recommendation" and now "what do I do next";
- Then looked at the concept of building and maintain scale in these services. While the costs of market entry are much lower than for retailers, the burden of innovation to retain loyalty i higher;
- Next discussed whether or not there was a "middle ground"in response to comments from Ian McCaig of Lastminute.com; and
- Finally, looked at loyally in Generation Y comparing three styles of branding - Revlon branding, Harry Potter branding and Night Club branding.
- offered a bit of advice to airlines that may or may not be low cost any more and those trying to run non-airline brands;
- introduced guest editor Mike Potts of e-interactive who put up a number of stories (here, here and here for example). I asked for others to come forward (with no response);
- proved that I am going soft in 2007 by giving snaps Lonely Planet and defending Qantas;
- saw the dead rise with Ryanair and Expedia cutting a deal for Expedia to take over the Ryanair Hotels business;
- watched the battle in China is being won by ctrip as eLong lost a CEO and went back into the red;
- helped spread the tech meme of the T-list with a small start then see it explode into an overwhelming number of links;
- started a vicious rumour about Amadeus in France;
- wondered why pilots were suddenly drinking more than usual (and then trying to stumble into the cockpit);
- of course it would not be the BOOT without random animals with a story on rampaging rabbits in Milan; and
- finally - gave the wife a moment to scream for the sanctity of the hills of Tuscany.
Tuesday, June 19, 2007
Taking a break - back on the blog around June 27
Monday, June 18, 2007
Hare raising delays in Milan
Expedia rumour of the week, month, year
was speculation in morning trading that Expedia is working on a deal that would take the company private at $30 a share, spin off its TripAdvisor business and eliminate 400 jobs.
I have heard nothing either way but did see that the stock price, while at a 52 week high, is almost exactly where it was 104 weeks (ie two years) ago (here is the yahoo finance chart). So it could just be that the good times for the economy and online travel are continuing to role and the Expedia stock price is bouncing back without any special help.
Sunday, June 17, 2007
The ones I read most
- aaron dalrymple
- Albert Barra
- Blog on Travel
- Dot tourism
- e-interactive blog
- Happy Hotelier
- Hotel Blogs by Guillaume Thevenot
- Hotel Internet Marketing News and Know-How
- inFlightHQ — Business Travel Blog
- Mike Wylie
- m-Travel.com and Travel Distribution News
- Online Travel Review — Daily Airline News
- Social Media On the Fly
- The BOOT - the Business Of Online Travel
- The Sydney Morning Herald Blogs: Travel
- Tourism Internet Marketing Blog
- Travel Rants
- Travel Start-Ups
- Travolution Blog
- TripAdvisor: We Are Not Making This Up.
- Viator Travel Blog
- Upgrade: Travel Better
- Luxury Travel Blog
- Adirondack Base Camp
- ADV Italia
- Air France Mexico - Weblog
- Apple Core Hotels
- Aviación Digital
- Bitácora de viajes
- Blog de gestión turística
- Blog de Viajes
- Brief Blog
- BuhlerWorks by Joe Buhler
- de viaje a Brasil
- Desde el Río Paraná a Tierra del Fuego
- Diario del Viajero
- Dutto Relaciones Públicas
- E-Mercadeo.com Marketing 2.0 en Internet
- en transición
- Entradas 31-40 » Diario del Viajero
- Entreprendre dans le e-Tourisme
- Erin Julian
- Escapadas Europa.
- Europe A La Carte Blog
- Explorando Perú
- Exposed Planet
- General Manager’s Blog - Opus Hotel Vancouver
- Hawthorne Hotel
- Hotel Blog
- Hotels , Friends and more…..personal blog
- Ibiza a pie de foto
- Kirkland Weblog
- Kiwi Viajero
- La Coctelera: ZuHause - Inicio
- Les Explorers
- Living with Legends: Hotel Chelsea Blog
- Marriot on the Move
- Me-go: Around-the-World
- My Travel Backpack
- National Geographic Inside Traveler
- New York Hospitality
- New York Traveler
- Notes from the Road - Travels in City and Country
- Planeta Viajes
- Primera Clase
- Rolling Rains Report
- The Cottage Chat
- The Cranky Flier
- The Front Desk
- The Lost Girls
- The McCluskey Blog
- The Travel & Hospitality Diaries
- The Travel Cooler - travel articles and photographs
- The Travel PR Blog
- The World Is Not Flat
- They Let Her Travel
- Tim Leffel’s Cheapest Destinations
- Toni Mascaró Blog Barcelona
- Top viajeros
- Tourismus - Zukunft
- Travel and Web 2.0
- Travel Horizons
- Travel Weekly Blog
- TripCart :: The Travel Blog
- TURISMO + ACTUALIDAD
- Two Dog Zoo Travel
- Viajar Asia.
- Web 2.0 Travel Tools
- Weekendhotel Weblog
- Xavier Cobos
- Yahoo! 360° - Profile - Lodgeman’s Profile
- A Long Ride
- Absolut BCN - Blog de Barcelona
- Airport Blog
- Andrew Pascoe’s Under The Rotunda blog
- Aquela Passagem ! Dicas Para Encontrar Aquela Passagem Aérea
- Argentina’s Travel Guide
- Back of House in DXB
- BedJump.com - Bed Jump - Hotel Bed Jumping
- Blog Rydges.com
- Brand Canada Blog
- Brave New Traveler - Online Travel Magazine
- Brazil Travel Blog
- Buenos Aires Argentina Guide |
- Buenos Aires Daily
- Buenos Aires through my eyes
- Buenos Aires, City of Faded Elegance
- Bull City Mutterings
- Chileno - Life in Santiago, Chile Travel
- Chronicles of On The Road Travel
- Comercialización hotelera? a donde vamos?
- De Viajero.com
- Diane Clarkson
- eHotelTools.com - Index
- Family Travel
- Foreign Perspectives
- France This Way
- Frank Arr - an aussie microsoft blogger
- Geeky Traveller - A Travel Blog for Nerds
- Guía de Viajes - La Aventura de Viajar
- HISTORY INTERNATIONAL - Drive Thru History
- Holiday Pad 2.0 - The Holiday and Vacation Weblog
- Jaunted -The Pop Culture Travel Guide
- Jen’s Site
- Jens Thraenhart
- Kulinarisch Reisen - Blog der Österreich Werbung
- La Descripción del Mundo
- Leatherwood Trail - Home Page
- Line of sight
- Lonely Planet | Travel Blog
- Los viajes de Jota
- Marketing Turístico
- My Marrakesh
- New York Traveler
- Normandy Gite - Le Gaillon
- Nos vamos de turismo!
- Notas do Turismo
- Our Journals - Netherlands
- Pasa en Buenos Aires
- Randy’s Journal
- Real Travel
- Relactions blog
- The Lobby from SPG
- Touristik-Blog hokat.de
- Trabber Noticias
- Travel & Tourism Technology Trends
- Travel Blog @ National Geographic Traveler
- Travel Post Insider
- Travel Stuff
- TurismoNet : Biblioteca digital
- Vagablogging :: Rolf Potts Vagabonding Blog
- Valencia está de moda
- Viaje na Viagem
- Voy de viaje
- Vuelos Baratos en Internet
- Vuelos Baratos en Internet
- World Hum | Travel Dispatches from a Shrinking Planet
Wednesday, June 13, 2007
Ctrip opens a physical store - not as revolutionary as you think
In truth Ctrip has always been an offline business as defined in other markets. The online travel business in China is all about call centre sales. According to Investor's Business Daily - Ctrip has 2,000 plus people in their call centre processing customer requests and bookings at hotels and nearly 70% of all customers make a reservation by phone. This does not mean that Ctrip are a bunch of technology Luddites, in fact the contrary. They have some of the best call centre technology and customer phone tracking systems that they are. Doing all they can to build up relationships with customers to make repeat bookings easy and to track the hell out of the activities of the sales staff to make them as efficient as possible. This is not a criticism as this is what is best for growth and sales in China. But it does mean that while we can get excited about the growth of Ctrip and the potential for online travel, we have to always note that the transaction engine is drive by people and calls, not bits and boxes with flashing lights.
UPDATE - Hotelmarketing is reporting that ctrip has announced plans to open an enormous call centre (reportedly the largest in Asia) - with more than 2,400 seats (capacity of up to 5,000).
Tuesday, June 12, 2007
Asdoo - alpha version of online instant confirmation conferences
With that background, I received in the post over the weekend the supplier/media kit from new product specific entrant - Asdoo. Asdoo are targeting the meetings and events market. While the site has the initial look and feel of a hotel only player if you chosse the "meetings/conferences" search features you see the options for adding conference room types (ie boardroom or conference) then catering, audio visual, rooms before and after (on or off the company account) and more. A step by step path through all of the pieces needed to book a conference or event.
The site is announced in beta but I would call it pre-beta (or alpha). The technology/UI all works (at least from the front end) but they have yet to load the inventory. The pack they sent to me has had a lot of money spent on it with ticket wallets, cds and marketing guides. All targeted for hoteliers and GMs of Sales to entice them to provide inventory to Asdoo.
I understand the business idea here. They refer to a recent PhoCusWright report on the Group and Meetings market to provide support for the model but I don't need that to agree that there is a market for making events and conferences easier to book online. If Asdoo can crack the challenges in front of them then I can see genuine revenue potential. However there are two big challenges that have to be cracked for the good times to flow:
1. Complex Booking for Consumers: Even with good technology and UI, this is still a complex booking. There are multiple variables - start dates, check in dates, conference room configuration, hotel room numbers, audio visual, catering, start and finish times and more. Traditionally online travel has only worked when it is simple for the customer. As soon as it gets complicated - consumers want to pick up the phone. Asdoo will need to ensure it has done all it can to make the booking path as simple as possible and provide customer support/backup in the early days.
2. Achieving supplier scale: Hoteliers love conferences. The food and beverage bill provides high margin joy and sooner or later the boss throws the card behind the bar and the attendees start sucking back house wine and beer at 8-10 bucks a glass. But it will take a great product/sales team to convince a series of hotels to load up the complex inventory types to fill Asdoo with enough to make the site viable.
In this first review of Asdoo and the conference market I think that the business model is a good one and as far as I know Asdoo is the first to market (or one of the first - comment if you know more) but the user interface will need a step up and customer support to be near perfect to drive consumer confidence and booking. Further a killer sales team is needed to drive supplier participation. Mostly however they will need patience (and therefore funding). This model will take time and market persistence to gain traction.
Congrats to the team a Asdoo including boss Arthur Avram on the launch. The materials say they have been at it for 4 years of development. With the site up - the fun now begins.
Sunday, June 10, 2007
Ex-Expedia execs executing
Former Expedia CEO Erik Blachford is back in the news as the CEO of TerraPass a carbon trading/offset company. Mike Fridgen has more on this here (Travel Start-Ups: Puddle Jumper TerraPass).
UPDATE - cheeky quote in Valleywag (originally the San Jose Mercury News) from another ex-Expedia CEO Rich Barton on the immediate legal action coming from the launch of Avvo
"Getting sued was, cavalierly, part of the playbook."All publicity is good publicity. Why would the now CEO of real estate site Zillow be commenting on Avvo? Well he is also a partner at Benchmark the firm funding Avvo.
Saturday, June 09, 2007
Sol Melia and flawed search marking reports
(Versión Español disponible en la blog propio de Mike Potts aquí)
It seems that publishing SEO benchmarking reports for the Spanish hotels market and using them for PR is all the rage these days, Adesis Netlife did it last year (downloadable here) and concluded that NH Hotels was the best in the market, now Sol Melia have released some PR quoting a report by Abser-t, claining they have the best positioning in search engines in Spain. These “SEO benchmarking studies” take a look at a few rival hotels chains performance in search engine visibility and try and present the findings as figures/scores so as to compare.
This report (references found in www.hoteltur.com as well as on the Sol Melia site here), not content with finding interesting ways to make Sol Melia’s SEO (natural positioning) performance look good, actually attempts to measure PAID search marketing performance (PPC) as well! Let’s get one thing straight:
It is IMPOSSIBLE to compare two companies PPC marketing campaigns by this type of qualitative analysis, never mind 10! Full stop.
I could write for hours about how this report is flawed in its facts and its methodology. It is without a doubt the biggest load of publicity biased rubbish I have ever read. If Sol Melia did pay for this (and we don't know if they did or not), then it would be like paying to take someone to dinner, then publishing the pictures to prove how attractive you are!
Here are the reasons why this report, and this way of measuring search visibility, are fundamentally wrong.
1. You cannot measure PPC performance in a comparative and qualitative way – paid search marketing changes placements by the second. Try doing a search for “hotels in Barcelona”. Then hit the refresh button. Did the paid results change order, did some ads disappear, some up, some down? YES, because Google optimizes campaigns against budget per day, because some companies use bid management systems, and because companies play with campaigns manually as well.
2. In this report the authors have decided to use a linear points scoring system for the natural listings, giving the top spot for a keyword 30 points, the second 29, and so on, then adding up the score for specific keyword searches. This is flawed and simplistic because;
a. Keywords and search engines are not linear things! Between 80 and 90% of search only result in visits to the first page of results, so coming on page 2,3 or 4 means nothing. There is no weighting of scores to account for this.
b. All keywords are not born equal. Some keywords drive lots of traffic and no sales to hotels, whilst others are valuable drivers of revenue.
c. Different hotels are targeting different markets. Some hotel chains are more family or leisure orientated, whilst others have more business hotels. Should the keywords deemed “successful” be the same for all these? Clearly not.
3. In at least two cases the report fails to report the results of important domains that belong to Sol Melia’s rivals. Hesperia Hotels, for instance, have three keys domains live – Hesperia.com, Hesperia.es and Hotels-hesperia.es. But the report only mentions one of these. Again a lack of balance and insight.
4. Finally it makes no sense to compare with no adjustment or analytical compensation a chain like Sol Melia with 350 hotels (and all the visibility that goes with this), with a chain like Hesperia that has only 50 properties.
This report was written by people who at best have no idea of how to use search engine marketing, what it means to value search marketing placement, or why keyword marketing works for some and not for others. At worst they do know, don't care and and simply trying to generate PR. It is embarrassing to Sol Melia's online marketing credentials to give this report any credence and support.
One last thing. It is possible to see whether a hotel chain is working hard on making sure that their distribution partners and competitors are not bidding on their hotels own branded keywords. This is an important part of a hotel chains PPC strategy, and involves both legal and commercial issues (for instance stopping resellers and their affiliates bidding against hotel names in Google). For example I just went on Google.es and typed “melia white house London”. What came second in the paid listings (when I did the search at 14.54 on 8th June 2007)? www.Hotels.UK-bookings.com, an affiliate of Booking.com.
Friday, June 08, 2007
The BOOT - The Business of Online Travel
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Thursday, June 07, 2007
Go Voyages on IPO path with (I think) a big mezzanine round
Now we hear that GoVoyages has raised a further Euro55 million from European Capital S.A. SICAR a division of European Capital Limited. Have not found a reference to how much big a share this gives European Capital but assuming that GoVoyages is still profitable and still growing you would have to assume that there was an increase in the valuation - giving European Capital around 15% of the company.
Looking at European Capital's website one of the things they specialise in is mezzanine capital - that is funding just before an exit event, usually an IPO. My guess then is even though a profitable GoVoyages does not really need the money, this is a pre-IPO play. The size of the stake is consistent with this guess. If true, expect to hear news of IPO planning (or a big trade sale) towards the end of the year
Poker and Online Travel 2
Tuesday, June 05, 2007
Travelpod CEO interview
Travelpod are a travel blogging platform and social network. The site - though it looks like a start-up- has been around since 1997. Luc and the 6 other members of his team have been building the site virally and with a little bit of banner and search advertising, mostly in their spare time. He admits to only going full time in the last six months.
The site has reached scale, according to Luc. He was keeping his performance metrics (traffic, revenue, member numbers) very secret but did share that they have "well over a million posted photos". The sites growth in the early days was slow and we had an interesting discussion about what were the external factors that created a growth environment. Luc pointed to three things that set up the growth for Travelpod:
- The proliferation of Internet cafes - giving travellers easy access to Internet connections while on the road;
- The dramatic drop in digital camera prices - while the site is a blog site, more photographs means more bloggers; and
- The most important driver was when Google bought Blogger. Not because this deal involved Travelpod but because it was the sign that blogging had gone mainstream. No longer did have to Travelpod need to explain to potential members what "a travel blog" was.
On the world post the TripAdvisor acquisition Luc was firm that it was all about business as usual with advertising sales, infrastructure and marketing support. No plans to change the brand or feed the Travelpod content into TripAdvisor or Expedia (so far anyway). This is the right approach. I support TripAdvisor's plans to buy more niche and targeted content sites and not change the brands. They should focus on the opportunity to cut costs and increase monetisation opportunities but leave the traffic generation to the in-house product and content teams.
The final area we discussed was my loyalty theory on Travel 2.0 companies. As you will recall from here and here - my view is that content/network companies need to innovate more than retailers to maintain loyalty to avoid the nightclub phenomenon where online users jump from one content/network site to another and then another (ie like Friendster to Myspace to Facebook to Bebo). Luc is confident that Travelpod readers are so passionate, loyal and emotionally connected that he hoes not have the same fear of customer shifting. They still need to innovate and launch new products and features and they have put in place customer retention programs to bring back members that stopped blogging or using the service.
Congrats to Luc and team on the acquisition.
American Road Warrior caught in empty airport
At Sydney airport there is rarely a queue at security and the two business airlines (Qantas and Virgin-Blue) allow online check-in. Does not mean that there is never a queue at Sydney airport. Getting a taxi home on a Friday night is like waiting for Godot.
Monday, June 04, 2007
500 miles of security queue at London Heathrow
From the Gate via Upgrade: Travel Better
Hotelscombined joins the meta-search wars with a difference
As the names indicate ProductReview is a broad product site (much like PriceGrabber that I commented on earlier) and Hotelscombined is hotel meta-search.
The Hotelscombined product is fighting in the same space in Asia as other meta-search players Bezurk and Sprice.com. They are also happy to take on the big guys - Sidestep & Kayak. They are trying to build a global business from Sydney. Yury tells me that currently 60% of traffic is coming from customers outside of Australia and they hope to raise that to 70% by the end of the year.
But Hotelscombined are more than a me too play. They have taken a different functionality/UI approach than the other players. They are keeping the traffic on their site for longer than the others. The typical meta-search player (if there is such a thing) sends the traffic over to the partner site relatively early in the search - just after the sort order results are displayer. Hotelscombined keeps the traffic for a click or two more. It sends the traffic over after the room type selection has been made.
The result is that they should:
- have a larger number of page views per visitor producing interesting monetisation options; and
- be sending traffic that is more qualified than the typical player and therefore producing higher conversions for partner site.
With their history and expertise expect Hotelscombined to be very aggressive and targeted in paid search. Well done Yury on a great product.
Saturday, June 02, 2007
Low cost carriers and the world of aviation: Too many acronyms - brain hurts
Then the word became confusing again. LCCs in some markets - like Virgin Blue in my own sweet home Bondi - said that they did not want to be called Low Cost Carriers any more. Now they wanted to be called - New World Carriers. Lots of marketing gumpf thrown around as to what this means but common themes are - really cheap but we still want a frequent flyer program, business lounge and pricing structure that allows for cancellations. In other words- a normal carrier without first/business class in short haul and with better (read tougher) deals with cabin crew unions.
The eventual response of full service carriers to the LCC phenom was to launch LCC offshoots. United launched Ted, Delta did Song, British Airways went Go, Qantas did Jetstar etc. However the push for new brands and cost structures was not an all round success. Ted is still flying and Jetstar is the fastest growing Airline in Australia. But - Song is no more. Its operations have been absorbed into Delta and Go was hastily sold first to PE firm then to easyJet and absorbed into the easyJet brand.
This leaves me thinking about how distinct are the differences between an LCC and full service carrier. Before I could come to a conclusion in these musings, e-tid reported today (registration required) that Virgin-Blue is
considering setting up a ‘super low-cost unit’ to compete with Singapore-based Tiger Airways, which starts Australian domestic flights later this year.So here we have a "I used to be a Low Cost Carrier but now I am a New World Carrier" being spooked by the entry in Australia of another LCC. The response - push the initial brand into full service (or as the CEO is quoted by eTid - "up market") and then act like a traditional carrier and create a new brand that does everything that Virgin Blue used to do but without the frills.
Fascinating strategy. It seems to me that there is a space in any market for carriers that base everything they do on price to the point of sacrificing customer service and convenience. However this model reaches a growth point especially in a market where for geographical reasons there is a limit to the potential for a short-haul market. Beyond that point service and flexibility have value to consumers. Similarly the scope for differentiation just on price is reduced. I expect that Virgin-Blue did not anticipate that it would find itself in that circumstance - having to increase costs by providing services for the business traveller to feed growth levels and then have to mimic its nemesis by launching a secondary brand. Brett and Virgin-Blue - if you do launch and new carrier to fight Tiger then it is time to cut the acronym crap (CTAC) and accept that you are a normal, everyday, regular airline that wants to provide business travellers with whatever they want (and charge accordingly) to keep them happy and flying.
Friday, June 01, 2007
Amadeus about to be smacked by Sabre in France
Now apparently while this is a done deal the "i's" are not yet dotted and the "t's" are not yet crossed. With 6 million segments at stake and with Amadeus' ties to European airlines there is a chance of a last minute "dropping of the pants" in Madrid to stop Sabre making this happen.
Anyone else out there in France know any more?
UPDATE - Sabre's own website has picked up my post in their "Sabre In the News" section but with no hint of a denial.
UPDATE 2 - Given the scepticism of some readers I have gone back to my source for confirmation on this rumour. My insider stands by her story. She says the rumour has been doing the rounds within Sabre's European customers for a couple of months. She should know as she works for one.
UPDATE 3 - Spoke this evening (June 5) with a spokesperson from Amadeus. They said
"The rumour is more advanced that than the reality...CWT regularly review their suppliers and partnerships as part of prudent business practice."This is not a denial of the rumour but is a clear comment that Amadeus believes they are still in the hunt to retain this client and that the sales battle is not over yet.