TripAdvisor's Users Predict 2008 Trends

A press release from Tripadvisor.com last week starts "Green & Clean Freaks Dominate; Traveler Say No to Cell Phones in the Air".

Germaphobia:
"Eighty percent of respondents are concerned about germs, bacteria and viruses when traveling. Airplanes are the most germy, according to 28 percent of those polled. Public transportation was next, followed by restaurants, hotels, and airports... Forty-five percent of travelers said their worst experience at a hotel was a dirty bathroom or dirty sheets, and 17 percent said their worst experience was the presence of vermin."
JOE> I don't know what the survey actually asked, but I think it is already urban legend that airplanes circulate viruses around. Additionally, Michael Crichton along with discovery channel and National Geographic has done their part post-SARS to increase awareness of how fast diseases can spread because of the ease of international travel. Lastly, if you ask a bunch of people what their "worst experience at a hotel is" and they answer something else besides dirty bathroom or dirty sheets, then you take notice. 45% saying that is a good thing; too bad it is not higher. The 17% presence of vermin - now that is disturbing. I am glad I have not experienced that in one-fifth of my hotel stays; I can't remember if I have had that experience in the last few years actually. Where do these 17% of the people stay anyway? Motel 8?

Go Green:
"Twenty-six percent of respondents said they will be more environmentally conscious in their travel decisions in the coming year. The green trend may be evident in their choice of transportation -- 22 percent said they'll go biking while on vacation this year, compared to 13 percent, last year. Forty-seven percent of travelers plan to go hiking this year, up from 43 percent, last year."
JOE> Wait... how does taking biking or hiking vacation make you any more environmentally friendly? I mean.. you are still taking a plane to get there right? Are you going further on the plane to get to that out of the way destination? That flight to the mountains might be half full rather than the full flight to a major city (fuller flights are more efficients and have lower carbon emission per passenger.).

Mobile Phones:
"Seventy-eight percent of travelers believe that mobile phones should not be allowed on flights."
JOE> So even if they were allowed on flights, the roaming fees would be freaking exorbitant. Look at what happened to Connexion by Boeing for internet access on flights. Crashed and burned because they charged too much. Let's hope some poor startup listens to TripAdvisor and keep their money in their pockets for another day.

Skewed Survey?
"Thirty-two percent of travelers (and 34 percent of Americans) are planning to engage in educational activity on vacation this year, such as a cooking or art class, up from 25 percent (and 28 percent of Americans), last year. Sixty percent of respondents from the U.S. said that the possibility of terrorism is still a consideration when planning where to go on their next vacation. Forty-five percent of Americans said the possibility of natural disasters (such as a hurricane, tsunami or earthquake) is on their mind, and 36 percent said the cost of fuel influences where to go on their next vacation, despite the recent decline in gas prices. Five percent said uncertainty with mortgage rates is affecting the way they plan travel in the next year, and six percent said the volatile stock market is affecting their travel decisions."
JOE: "US", "Americans"... how many of these 2500 surveyed were actually non-Americans? Is the press release skewed towards the US press or is the survey? Enquiring minds want to know.

R-rated to X-rated Vacations
"Twenty-four percent of travelers said they are likely to dress more provocatively while on vacation and 19 percent of travelers have had to impose the "whatever happens in X destination, stays in X destination" rule with their travel partners. Twelve percent of respondents have been to a clothing-optional or adults-only resort."
Joe> Again who is being surveyed? It looks like 12% are Europeans. At least 19% have been to Vegas. And 24% are women (men dress provocatively?).

Top 3 World Destinations:
1) Jerba, Tunisia
2) Makandi Bay, Egypt
3) Phang Nga, Thailand
JOE> So those survey either watched Travel Channel a lot or they watched a lot of E! Wild On with Tara Reid (where she just runs around in exotic destinations getting drunk.). I mean those aren't destination that just immediately come into your mind when you ask people. But then again, if TV is influencing people, then what else is new. It's just that those locations are just too small to support being "Top" destinations. Talk about being anti-ecotourism; just tell the world this tiny little place is the TOP destination. I am not going to those places next year; if I don't make it this year, then I won't bother because it will be trampled by 2009.

Google Analytics For Dummies

So I have been steadily blogging away. In the last month (October), I have been publishing an average of 2 posts per week. Traffic to this site was not steady, but it comes in. I can almost track it to the day that I publish a post as the blog spiders and readers pick it up.

Anyhoo... I noticed a week ago that my traffic dove to ZERO around the last week of October. I track this on Google Analytics which is a very easy to use tool. I did not think much of it. I was too busy and who knows what's going on with the interweb. See the graph of October traffic below:



About thirty minutes ago, I checked in again and see the above. Now I am getting a little worried. I have been pushing things out and nothing? ZERO? My ego was getting hurt, you know. Since launching this blog in mid August, I have had visits from people in 204 cities from 49 countries, who speak 18 languages. 75 % of my visitors were new visits, so I get a 25% returning visitor traffic. Each of these visits resulted in 1.55 pages viewed per visit. 25.9% were on DSL broadband, 21.3% were on cable broadband, 7.1% were on T1 (i.e. office connections), and 4.5% were on dial-up. (the rest 40% were "unknown"). Then suddenly.. NOTHING... NADA... ZILCH...

Then WHAM! SH...ZAMM, it hit me. I changed the template on my blog a few weeks ago to this brownish thing. I went to my blogspot dashboard and just selected a new template. I reviewed it and made sure it looked ok before I published it. All looked OK so "Save my template". But DUH!!!! When I change template, the Google Analytics script that I had put in the last template go wiped. So I have not had any tracking scripts on any of my pages. No wonder. Yikes!!!!!

Well, it is up now. But this is why I leave the tech to techies. Google Analytics is great for amateurs, but if you are using it for your ecommerce website, leave the monkey business to those who know what to do... sigh...

Numbers of Online Travel Customers Are Declining

According to the NY Times, "Travel Sales Still Growing, but Numbers of Customers Are Declining". See here.

It certainly sounds alarming, but maybe because alarming sells newspapers. But let's check out the highlights....

1) According to a recent survey of more than 60,000 Internet users in the United States by Forrester Research, a technology consulting firm, 9 percent fewer people booked travel online this year than in 2005.
JOE> But outside the US, the trend is the other way around. Europe is not yet as mature as the US. The Asian (with 3 billion people) are still getting online and are just beginning their shift from offline to online.

2) PhoCusWright found that among travelers with access to the Internet, the percentage who usually book travel online dropped to 62 percent at the end of last year from 68 percent in 2005, while those who say they usually arrange travel offline increased to 31 percent from 25 percent during the same period.
JOE> Interestingly enough, PhocusWright also published a report showing that between 2005 and 2006, less % of people were Shopping & Buying Travel Online. Increasing were people who Shop& Buy Travel Offline and people who Shop Online & Buy Offline. See below.


3) Industry revenues are still strong, mostly because those consumers who book travel online are doing more of it. According to the Forrester survey, the average online booker said he or she would spend 50 percent more on travel this year than in 2005.
JOE> So what does this mean? People who are online savvy are booking more and people with lesser patience or lower attention span are booking less? Are older people dropping off and younger people staying on and booking more?

4) Online travel executives say part of the reason for the dearth of innovation is that the online travel reservation systems are largely extensions of technology built in the 1960s.
JOE> Are we talking the GDS, PMS and CRS? Some of that is true enough, but the consumers are filtered and do not see a lot of that technology any more with middleware and web applications in the middle. On the contrary, meta search engines, like bezurk.com, and sidestep.com are giving consumers a lot of insight that they never had before.

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But really, the marketplace is overcrowded with OTAs and their affiliates and their spam. Consumers are becoming disenchanted with the intermediaries who are not able to provide the level of customer service that a supplier can. For example, if you book with an OTA and your friend booked directly with the supplier, who do you think has an easier time change or amending a reservation?

It would be very interesting to see if brand direct bookings have increased because consumers find it easier and more reliable to book direct rather than with an online travel agent.

Also, how many of these people who stopped buying online still research online? Looking at the destination and then finding out what is a "good" rate. They may not book online, but it would be pretty stupid not to at least Research online...

A Day @ Ecommerce Expo in London (Olympia)

I spent most of yesterday at the Ecommerce Expo here in London. I was here in London for business in any case and it was a good coincidence that the expo was here at the same time and was only a 15 minute walk from the Millennium & Copthorne office in Kensington.

First thoughts was that it was a small show. Olympia seems to be quite a large venue and we got slightly lost because signage was not very good. We initially went to the wrong hall - as did other people so we did not feel so stupid. (Note to EC&O who runs this exhibition venue, you need to get on search engine marketing - big time. The site is alright - once you find it. And you need a good domain like olympiavenues.co.uk rather than eco.co.uk.)

Anyhow, despite being a "small" show, there was a lot of buzz in the air. The companies there were mostly relevant and you had the anchor exhibitors like Google (huge booth plus the Google Academy "classroom" downstair which was 4 times the size of their booth).

So what did I find interesting to me?

WebCredible - With the recent website relaunch, I would love to run some usability test to compare with the EyeTracking studies we did last year. They seem like a good outfit. Asked them to meet me on Friday as I was leaving that evening. Let's see what happens.

Gomez - Gomez's describes themselves as "a leading provider of on-demand web application experience management solutions, helping the world's top businesses ensure quality web experiences for their customers". Yada yada yada... cutting through the clutter: "Internet performance monitoring service". I had been thinking about using a service like Gomez to monitor my site's performance from the end-user's perspective. Akamai had recommended them as a 3rd party independent monitoring service, and it had been in the back of my mind to call them up. But hey, they were here and did a decent demo. Please call me.

Omniture - OK so we already use them. I have been seeing on my Omniture Dashboard about TouchClarity product and wanted to find out more. Interesting stuff actually. Using information from their tags to tell our servers to deliver targeted content. So it can be simple like providing specific promotions to people coming from specific geographic locations. Or, in theory, marrying that with your CRM to provide personalized customer visits. Anyhow, for M & C, it probably at least 2009 stuff.

SEO Junkies - I had a call from these guys a few weeks ago so did prearrange to meet them. They focus solely on search engine optimization - no pay-per-click, no advertising, no creative. (though their parent company Advantys does some of this agency stuff.). It's a good strategy since SEO is so paramount to eCommerce strategies and is the neglected in favor of PPC. And yes, there are tons of companies offering to optimize PPC campaigns. I stayed away from those (and.. oh.. yeah.. by the way, these PPC optimizer also do SEO on the side... yeah right).

Google - of course I have to pay homage to Google. They shouted a lot about Google Checkout and how "Sellers get free processing on all orders in 2007". There is also a plan in place where for every dollar you spend on Adsense you get ten dollars of free processing value. Something like that. I asked about Google Checkout for my hotels since I am looking at a prepayment product. Alas, Google CheckOut does not service the travel sector as a policy. They are getting a lot of requests.. something like half of their requests are from the Travel sector, but the company policy right now is no travel. Don't know exactly why. Is there a lot of fraud? Is it the "mail order" merchant thing?

There are many free seminar, but they are mostly pitches for the companies that are presenting. That's actually fine, but of the 4 seminars I attended, only 1 was worth the time. It's alright to sell your product, but the delivery and the pitch could be a lot more engaging. I won't mention any names.

It's a two-day event, but one day was enough. We all have work to do!

Joe... Out.

Asiatravel.com partners with travel search engine Bezurk.com

Good news for the Asia travel meta search sector.

I had AsiaTravel's Boh Tuang Poh (Executive Chairman) and Bezurk's Craig Hewett (Chief Marketing Officer) on my HEDNA OTA panel two weeks ago (presentation here). Craig mentioned that they were working closely together and hinted at something further. So what was launched was (See Bezurk's press release here):

"Asiatravel.com, the pan-Asia total travel reservation service and Bezurk.com, Asia Pacific's leading travel search engine today announced a marketing partnership as part of which Asiatravel's hotel and flight prices will be integrated into the Bezurk travel search which will expose Asiatravel to a large new audience."

This will take advantage of Asia Travel's instant online confirmation for air tickets (see their PR piece here).

Bezurk also hinted that they would soon relaunch its brand into a "four-word" name. Something to compete with ... say... Zuji.com. Anytime now...

Online Travel Agents: Can we live without them? Part 3

Finally, the last part of this trilogy. So we ask: Why do OTAs dominate the top of the visitor report by so much? Why have hotel brands not been as successful?

OTAs innovated and have created many "firsts" in the online travel marketplace. Priceline's "Name your own price" boosted the whole opaque distribution model. A number of the large OTAs with direct access to GDS and feeds introduced the calendar availability to consumers; now calendar availability is expected. Traveler reviews: TripAdvisor is the "gold standard" in the travel sector though epinions.com was the first consumer review site ever.). True dynamic packaging is not yet available, but OTAs have long allowed you to buy airline ticket, book hotel rooms and buy parking at the airport. Affiliate model... Hotels.com in the US circa 2002-2003 ('nuff said). Those affiliates tend to be small sites that go after niches and locality, hence basic "niche marketing". And ...umm.... they are "independent"... uh--huh... sure.

But honestly, they did bring consumers online. The OTAs spent a LOT of money brand building and getting consumers to start booking online and be comfortable with giving their credit cards online. Would the online travel industry be where it is without OTAs?


Why have Hotel Brands not been as successful online as OTAs? Because the hotel industry ADAPTS slower than OTAs INNOVATE.

A painfully true comment... And all of you hoteliers are nodding your heads. And you OTAs are smirking, but you can't blame us. The hotel's core business is running a hotel, while OTA's core business is to sell hotel rooms (and other travel products.). A hotel's major investment is in the infrastructure, the rooms, and the building, while the OTA's major investment is in technology and innovation. OTA's, which grew out of the dotcom era, are naturally and instinctively tech savvy, adaptable (technology and business models), and hungry.

And OTAs are now on the defensive since a couple of years ago...

I had a bit to trouble cobbling this data together but managed to fine some stuff regarding share of online bookings between Hotel Direct (Blue line above) and OTAs (red line above). In 1999, it was 55% or so for the Blue Team and 45% for the Red team. As you see by the bubbles at the bottom, the next few years had companies IPO, being founded or spun off (Expedia, Priceline, TripAdvistor, hotels.com); the share of the Red Team rose to 48% or so. But with the dotcom bust and Wall Street getting shy, we started to see consolidation in end 2002/beginning 2003 onwards. At the same time, the Blue Team (at least the Michael Jordans, Shaquille O'Neils, and Yao Mings in the team) started getting their act together and investing in technology and people to catch up. By end 2005, it was more like 54-46 for the Blue Team. And in 2006, the star players on the Blue Team are saying they are at over 80% while the second stringers ( ahem...smaller hotel chains) and free agents (independent hotels) are bringing in the rear. So the trend for the next few years is to increase that average score to 64-36 by 2010 according to Merrill Lynch. I am not so sure about that, because us second stringers and independents need the OTAs because we do not have the brand clout and spread of hotels. We need them as part of our distribution strategy.

Meanwhile, OTA's will continue to innovate faster than most of us can follow (except perhaps the star players.)
TripAdvisor is in Facebook (which is now worth USD 15billion dollars by the way) with "Where have you traveled" application. Travelocity increase its CRM efforts with Farewatcher Plus.

And Orbitz combines social networking with information like departure and arrival times in Traveler Update. So a traveler can update (a la twitter) about the bad restaurant in Terminal 1 in O'Hare or the long security checkpoint at Gate 1. Would a hotel group do something like this? Not very likely as the ROI on such a venture would not be worth it. Orbitz does it because it is part of their "service" to customers as well as brand awareness and position.

So OTAs have their place, and they will have a share of the online marketplace. What share will depend on which hotel group, on which destination and on which property. Some properties will depend more on OTAs than others just as some hotels will naturally depend on one channel over another.

So as I ended my presentation:

"OTAs. You can't live with them, but... You can't kill them."

The End.

Online Travel Agents: Can we live without them? Part 2

So next is the Scene - i.e. What is brand online's medium to long term strategy? What do consumers think about brand online vs OTAs? How many visitors go to brand online vs. OTAs? How much cross visiting is there between OTAs and Brand Online?


1) What is brand online's medium to long term strategy?
Well brand online is in direct competition with OTAs on most fronts online since 90% of Shopping traffic is generated from search engines. Hence search engine marketing is the battleground i.e. SEO and PPC. Search for any hotel and you will always find at least 8 of the top 10 results are OTAs (or their affiliates) in the natural search results. And look at the pay per click advertising and you will see many ads from OTAs - unless the name is trademark protected (only on Google!).

Since the cost of sale for direct online channel is a maximum of 10% vs the average OTA commission which is over 20%, it makes sense for a hotel group/hotel to want the traffic direct and save on the additional commissions. So the medium to long-term strategy is to channel shift the consumer from booking with online travels agents to booking brand direct.

2) What do consumers think about brand online vs OTAs?
Consumers prefer to book brand direct primarily because they get the best rate guarantee, they think the get special prices and promotions, and they can earn loyal points and rewards.

Consumers also feel that they are more satisfied when buying direct.

So while they say they like to go direct, what do they actually do in practice? Where do they go and how do they shop?

3) How many visitors go to brand online vs. OTAs?
Here is Comscore's August 2007 data for the worldwide Travel Category. Of the 791 million internet users worldwide, 38% go to travel sites during the month (or 301 million users). Expedia tops the travel category with 62 million users, followed by Travelport, Yahoo! Travel, Priceline and Lastminute. The first hotel company that comes on the list is IHG at number 12 with 7.4 million users. So even though consumers say they like brand online sites better, most of them still shop at OTA websites.

4) How much cross visiting is there between OTAs and Brand Online?
What's more interesting is to see this overlap. Here the column data is from Hilton and InterContinental groups crossed with the same Travel Category report in the slide above. So 48% of hilton user also go to Expedia, 26.2% also go to Travelport sites during that month. The Index column reads like "hilton users are 6.11 times more likely to visit expedia sites than the average internet user". So take a look at the InterCon column against the Travel Category.

Now check out the Index for Hilton vs InterCon and Marriott and Wyndham. The Index is over 2 times that of OTAs; 18.48, 23.58, and 14.83 respectively. This means that consumers are looking everywhere and not just your brand online and OTAs. They are looking at other hotel sites too. Probably your direct competitive set for your particular hotel.

Think about it. It's not that hard. Just a few click of the keys into Google and you can see it. Better yet the OTAs may very well tell you who is in the area. You can start your research there.

So that's the end of Part 2. In the next part, we will look at: Why do OTAs dominate the top of the visitor report by so much? Why have hotel brands not been as successful? And we will come to some sort of resolution.