Have Search, Will Travel

Year after year, travel is the e-commerce category killer, and it keeps getting easier for consumers to research and buy travel online. Businesses in the travel space in turn have embraced the consumer democracy of search, and such companies continue to be among the most sophisticated search engine marketers, both with natural and paid listings.

It was thus fitting for TravelCom to close out its recent conference with the final day largely dedicated to search engine marketing, featuring three consecutive panels discussing "The Next Big Thing in Search."

What is the next big thing? It depends on who you ask.

During the first panel, "General and Information Aggregators," some said the next big thing isn't search at all. This is where Google's head of travel, quoted in last week's column, said, "We're not just a search engine."

Travelzoo's senior vice president of strategy, Elizabeth Rose, then downplayed search. That's understandable; Travelzoo isn't a search engine. It's a directory, and its display of directory results is much easier to scan than its internal search listings. According to Rose, the next big thing in search is... e-mail marketing. There is of course room for both e-mail and search, with e-mail especially helpful for customer retention. Yet reaching out to the customer looking for you remains a very big thing; it's so big that we're all still trying to grasp how much of a game-changer search is.

The panelists didn't forget what they were there to discuss. Yahoo! director of product development, Jasper Malcolmson, offered a by-the-numbers take. He said 76 percent of online travel purchases are preceded by search, consumers average six searches before any travel purchase, and 50 percent of searches include two words or more. The last stat threw me. How many one-word travel searches are there? Also, it seems logical that if the first search is a single word such as "Vegas" or "hotel," the next five searches would be two, three, or eight keywords as the consumer fine-tunes the query.

The second panel featured "Meta & Content Aggregators," with panelists from Mobissimo, SmarterTravel.com, Kayak.com, and SideStep. The sparks flew during a debate on how comprehensive a travel aggregator's results need to be. It's one of those issues of perception, where the customer needs to believe the site has the best deals from the most providers.

Mobissimo Co-Founder Svetlozar Nestorov quoted Malcolm Gladwell's book "Blink," saying that too much choice is bad for a consumer's well being. Overwhelm the customer and the sale is often lost. Sidestep CEO Brian Barth said what his company does is help consumers make value-based decisions, as opposed to just highlighting deals by price.

Customer experience is going to be the major x-factor. The differentiator can't just be speed or comprehensiveness. A distribution deal with a portal (as Kayak has with AOL) helps expand reach, but that won't be enough to determine the winner. One site that understood this before its time was VacationCoach, led by Head Coach Rob Roberts.

Roberts told me in 2002 (for an eMarketer article), "After awhile, a lot of the travel sites start looking the same. So they have to differentiate themselves... If you know that this particular travel company knows you and has very effectively been helping you, that introduces a switching barrier. It 's going to be a hard decision for you to move to somebody else to do your travel plans, even if you can save a couple bucks."

Roberts brought this up in the heat of the Expedia-Travelocity-Orbitz arms race. Now there is a slew of new players, and the airlines, hotel companies, car rental companies, and cruise lines have redoubled efforts to serve consumers directly. Roberts's thoughts are even more relevant today. The good news: eMarketer said online travel revenues will reach $58 billion in 2005 and will top $80 billion in 2007. The pie keeps getting bigger.

The last panel featured the buyers of search, with speakers from Travelocity, Cendant, Spirit Airlines, and Priceline.

Cendant Car Rental Group Vice President of Online Marketing John Peebles delivered some of the biggest eyebrow-raisers of the day. He first remarked, "Meta search is still a solution in search of a problem." Later, he mentioned that for Avis, a Cendant company, "The brand would be better off if the Internet didn't exist." That hushed the room. But think how many car rental companies you can name. Then think about how many more you can find online with search. It's the level playing field, so Avis will have to stay true to its brand and keep trying harder.

Spirit Airlines Vice President of Sales and Distribution Marc Cavaliere said that 60 percent of sales come from its Web site, and he beamed while he was talking about search. Cavaliere called search "the great equalizer."

It was a member of the audience who came up to the microphone and declared that, thanks in large part to search, "There is a lot less dumb money being spent."

Look where the smart money is. Can you sense just how big a thing that is?

Recommend (1) Print RSS