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The Honolulu Advertiser
Posted on: Sunday, February 8, 2009

Online travel sites losing to social media

By Julie Johnsson
Chicago Tribune

CHICAGO — Airport codes, travel dates and departure times.

For many consumers, the best way to research trips used to consist of keying those three components into the booking engine of a site like http://www.Orbitz.com, then checking for the cheapest results.

But as the Web evolves, online travel behemoths like Chicago-based Orbitz find they have to devise new ways to engage customers or risk becoming irrelevant as social media and search engines change how people shop for travel.

One challenge is finding ways to reap advertising dollars from people who browse but don't buy from Orbitz or its peers. According to Forrester Research Inc., nearly half of the traffic to online travel agencies consists of people who check out hotel or airfare options, then book directly with the supplier to get a better deal or to avoid paying a $5 transaction fee.

People are traveling less and researching trips in greater detail as the economy worsens, analysts said. And consumers are giving more weight to the experiences and opinions of fellow travelers in making vacation decisions. The trend, a challenge to traditional travel powerhouses, is helping foster a cottage industry of small, niche sites like Chicago's iExplore, devoted to adventure travel.

"We're seeing a fundamental shift from the travel consumer starting their travel-planning process at a booking widget to going straight to a search engine like Google," said Cree Lawson, founder and chief executive of New York-based Travel Ad Network, which handles advertising for 213 travel Web sites. "When consumers do that, they're discovering a lot of sites they didn't know existed."

In December, the number of visitors dipped at the two largest online travel agencies, run by Orbitz Worldwide and Expedia Inc., according to data compiled by ComScore Media Metrix. But traffic soared 51 percent, to 9.9 million, for the third-place finisher, a group of travel content sites affiliated with Travel Ad Network.

The number of "lookers," who noodle around travel Web sites, is expected to grow far more rapidly than "bookers," who buy from online travel agencies, over the next five years, said Henry Harteveldt, a travel industry analyst at Forrester Research Inc.

Orbitz is adapting with tools that let consumers share details of delays at airports, and tap the "Where I've Been" application on Facebook and by giving a higher profile to user reviews. Orbitz also is trying to embed terms that will attract the "bots" of Google or other search engines, giving it a high profile when consumers search for travel options.

That's just the start. The company also has a new, high-powered computer platform that it plans to use to find ways to help its millions of customers scope out vacation options.

"We're very excited to take that insight (and) mine that insight in a way that allows us to provide a better service to customers around the globe," said Jeff Clarke, chairman of Orbitz and chief executive of Travelport, which owns 48 percent of the online travel agency.

But Harteveldt thinks online agencies "really need to evolve into media companies." He envisions a strong ad push to make money off people who just browse the site for deals, and new user interfaces that arm customers with details of not only airline fees but also in-flight entertainment systems, seating upgrades and other data that can make a huge difference on long trips.

Travelers' thirst for details bodes well for iExplore, which helps people track down restaurants in Oman and book excursions to Antarctica.

About 30 percent of its 1 million monthly visitors use the site to book excursions to exotic locations; the rest drop by to garner travel insights or share information.

"So many people depend on the opinions of others in making travel decisions," said Todd McClamroch, CEO of iExplore. "It used to be someone you talked to face to face. Now, you trust the people you see regularly online."