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Travel Planning
According to Hitwise data, Google proved to be the greatest source of traffic for the U.S. travel industry with 30.41% of travel searches in July, a 6% gain over last year. With 3%, Bing had the smallest share of travel searches, but the most significant increase with 69%.
Google, on the other hand, proved to be the greatest source of traffic for key U.S. industries. The search giant represented 23.42% of automotive searches (a 7% gain over last July), 20.22% of shopping searches (a 7% annual gain) and 30.41% of travel searches (a 6-% gain over last year). Notably, the gains in travel searches may be linked to Google's proposed acquisition of travel software company ITA, which Brafton covered in July.
Bing had the smallest share of vertical searches, but had the most significant annual increases in July 2010. It demonstrated year-on-year gains of 77% in the automotive industry, 33% in the health industry, 84% in the shopping industry and 69% in the travel industry - though it accounted for less than 3% of each of these industries' searches.
Ask.com also showed significant gains in July 2010. The community-based search engine increased in market share by 6%, accounting for 2.32% of searches last month. While it still has a long way to go, even to catch up to search third-runner Bing, its quick ascent indicates users like social search features, which Ask rolled out last month.
(HOTELMARKETING.COM, August 2010)
Overall site performance is critical for US travelers who expect quick page load times for travel websites, according to the results of a study conducted by PhoCusWright on behalf of Akamai entitled "The Consumer Response to Travel Site Performance".
Key findings from the study include:
- The 3 second rule: 57% of online shoppers will wait three seconds or less before abandoning the site.
- Younger travellers are less patient - Generation Y and younger travellers are less patient than older travelers when it comes to page load times. 65% of 18-24 year olds expect a site to load in 2 seconds or less.
- Prevention is key: a 1/3 of travellers would be less likely to visit a site after experiencing technical problems like slowness or errors on the page. Business travellers are slightly more likely to have a negative reaction.
- Loyalty is not forgiveness: active loyalty program members are more likely than other travellers to indicate that they would not likely be influenced at all by technical glitches at 34%. However, the remaining 66% are actually more likely than others to have strong negative reactions.
- Travellers tend to be multi-taskers: 59% of consumers do something else when waiting for a travel website to load. Nearly a fifth (19%) open another travel site in a new window when made to wait.
- Hidden fees may cost you: 43% of online shoppers have abandoned a booking because the final product price and/or fees were higher than they were willing to pay.
The study also examines travelers' reactions to technical issues. Findings reveal that many travellers are guided by their previous experiences with a particular website, and for just over a third of consumers (34%), a technical glitch will lower their likelihood to visit a site again. Business travellers and loyalty program members are less tolerant of technical problems, and are slightly more likely to have a negative reaction to them. Research shows that these groups of online shoppers are also the most valuable customers for online travel sites. Thus, the stakes for site performance and streamlined, transparent transactions are even higher for companies targeting these segments.
The study is based on the feedback of 2,763 US-based travellers interviewed between January 12-28 2010 about the status of their current online expectations and key elements of the online consumer experience.
(Travel Industry Wire, June 2010)
40.23% of all visits to the online 'Travel' industry in the US went to the top 10 websites for the month of May 2010. 49.48% went to the top 20 websites and 69.81% went to the top 100 websites, according to the Hitwise Travel Report.
Top 10 websites in the 'Travel' online industry in the US for the month of May 2010 based on visits:
1. Google Maps maps.google.com: 15.50% market share
2. MapQuest www.mapquest.com: 9.24%
3. Expedia www.expedia.com: 3.24%
4. priceline.com www.priceline.com: 2.00%
5. Southwest Airlines www.southwest.com: 1.91%
6. Travelocity www.travelocity.com: 1.90%
7. Yahoo! Maps maps.yahoo.com: 1.77%
8. TripAdvisor www.tripadvisor.com: 1.68%
9. Orbitz www.orbitz.com: 1.53%
10. Yahoo! Travel travel.yahoo.com: 1.45%
The travel category lists those sites which are related to travel and the travel industry, including publications, travel agencies, transport services/people carriers, airports, destinations, resorts, travel and locality guides and accommodation.
(HOTELMARKETING.COM, June 2010)
Experian Hitwise revealed the most popular travel websites in the US for the week ending August 21 2010 in the categories Agencies; Destinations and Accommodation; Airlines and travel search terms.
Top Agencies websites in the US for the week ending June 5 2010 by % of visits:
1. Expedia (www.expedia.com): 15.98% (previously ranked 1st)
2. priceline.com (www.priceline.com): 8.43% (2nd)
3. Travelocity (www.travelocity.com): 7.65% (3rd)
Top Destinations and Accommodation websites in the US for the week ending August 21 2010 by % of visits:
1. TripAdvisor (www.tripadvisor.com): 6.51% (previously ranked 1st)
2. Hotels.com (www.hotels.com): 3.11% (2nd)
3. InterContinental Hotels Group (www.ichotelsgroup.com): 2.35% (3rd)
Top Airlines websites in the US for the week ending August 21 2010 by % of visits:
1. Southwest Airlines (www.southwest.com): 21.06% (previously ranked 1st)
2. Delta Air Lines (www.delta.com): 13.08% (3rd)
3. American Airlines (www.aa.com): 10.30% (2nd)
Top Travel search terms in the US for the week ending August 21 2010 by % of clickss:
1. mapquest: 3.77% (previously ranked 1st)
2. google maps: 1.43% (2nd)
2. mapquest driving directions: 1.20% (3rd)
(tnooz - talking travel tech, August 2010)
40.72% of all visits to the online 'Travel' industry in the US went to the top 10 websites for the month of April 2010. 49.93% went to the top 20 websites and 70.20% went to the top 100 websites, according to the Hitwise Travel Report.
Top 10 websites in the 'Travel' online industry in the US for the month of April 2010 based on visits:
1. Google maps maps.google.com: 15.42% market share
2. MapQuest www.mapquest.com: 9.67%
3. Expedia www.expedia.com: 3.39%
4. Southwest Airlines www.southwest.com: 2.03%
5. priceline.com www.priceline.com: 1.94%
6. Travelocity www.travelocity.com: 1.89%
7. Yahoo! Maps maps.yahoo.com: 1.81%
8. TripAdvisor www.tripadvisor.com: 1.62%
9. Orbitz www.orbitz.com: 1.59%
10. Bing maps www.bing.com/maps:1.37%
The travel category lists those sites which are related to travel and the travel industry, including publications, travel agencies, transport services/people carriers, airports, destinations, resorts, travel and locality guides and accommodation. (Travel Industry Wire, May 2010)
With the growth of smartphones, savvy travellers are beginning to lock in on the advantages of hotel and airline applications to save them time and money. One in ten (10%) respondents to a Deloitte survey have used a hotel application on a web-enabled smartphone. Respondents who have used a hotel application have used it to: book a room, access their loyalty program account, view/modify/cancel an existing hotel room reservation, pay a hotel bill, check-in and check-out.
The internet continues to play an important role in travelers' decision-making processes and social media has evolved into a valuable resource, as well. One in two (50%) respondents have used a computer or web-enabled smartphone to research information online about a hotel, while almost half (47%) have researched information online about a flight. 16% of respondents have read a positive consumer-generated comment about a hotel/motel, which influenced their decision to book a room at that facility, and 13% have used a social media site to research or plan a trip.
The survey was commissioned by Deloitte and conducted online by an independent research company between April 27 and May 5 2010. The survey polled a nationally representative sample of 1,001 consumers. The survey has a margin of error of +/- three percentage points. (HOTELMARKETING.COM, May 2010)
American tourists are turning in increasing numbers to online reviews of hotels and destinations, according to the outcome of a survey conducted by Menlo Consulting Group.
The ‘TravelStyles USA Study' reports that nearly 75% of US travellers to Asia read online reviews on sites such as TripAdvisor.com or Yahoo!Travel. This latest TravelStyles USA survey identifies key travel trends, examines the growing use of mobile technologies and social media for travel and places substantial emphasis on the impact of the down economy on Americans' intentions to travel overseas. (PATA Newsletter, April 2010)
Over a third of US consumers (34%) report that a technical glitch will lower their likelihood of visiting a travel Web site again, according to the Consumer Responses to Travel Site whitepaper by Akamai and PhoCusWright.
The whitepaper indicates that business travellers in particular are less tolerant of glitches than leisure travellers. (PhoCusWright, April 2010)
More than 4 in 10 smartphone owners in the US would find trip planning apps useful if they notified them of schedule and rate changes, consolidated itineraries or helped manage loyalty programs, according to data from Compete.
Travel-related mobile apps that US smartphone owners believe would be useful for trip planning, February 2010 (% of respondents):
- Notifies me of unplanned schedule changes for booked trips: 52%
- Notifies me of rate changes for planned or booked trips: 48%
- Consolidates all my travel reservations into one itinerary: 42%
- Helps me manage my rewards, points and loyalty points with multiple companies: 41%
Nearly 2/5 of smartphone owners reported doing at least some of their leisure travel research on their mobile device, and more than a quarter completed at least some of their bookings on their phone. In addition, a fifth of smartphone owners were interested in receiving travel Website advertisements on their device.
While the industry had been slow to respond to consumer interest, app development has heated up. Hotel Internet marketing firm Hospitality eBusiness Strategies (HeBS) found that almost a quarter of hoteliers worldwide are planning to develop an iPhone app this year.
Mobile marketing initiatives hoteliers worldwide plan to implement in 2010 (% of respondents):
- SMS text marketing: 27.6%
- Mobile site: 25.9%
- iPhone app: 24.1%
- Mobile booking engine: 22.4%
- Mobile banner advertising: 19.0%
- I am not planning on mobile marketing initiatives for 2010: 32.8%
Many also plan to get on board with SMS marketing, mobile sites and mobile booking capabilities. That should help them get a piece of the increased bookings expected via mobile this year; PhoCusWright predicts US travellers will spend $76 million on direct domestic hotel bookings through a mobile device. (eMarketer, April 2010)
It appears that the old addage, "the customer is always right," still rings true, at least in the world of social media. What a consumer experiences on their travels is readily available to the global population via social websites. And the people who read this information, use that input to make their decisions about how they will book their trips, according to the findings from a PhoCusWright study, which analyzed 1.9 million traveller reviews and visitor referral and conversion traffic. This coincided with researching over 50 social travel websites, including social networking sites.
A key finding showed that users are less passive, with the shift from searching and consuming, to collaborating and commentating. The new dynamic in which the user generates further content, also paves the way in which social media commentators have the potential to influence other travellers, suppliers, products, and services. Promising figures show a 34% increase in monthly visitors to social travel websites between 1H08 and 2H09. This shows the growth in the online travel industry last year, despite the global economic downturn.
The report suggested the industry should aim to better understand the needs of consumers and improve their communication channels in order to keep up-to-date with social media trends. (eTN eTurboNews Global Travel Industry News, April 2010)
The top three websites in the Travel - Destinations and Accommodation category that attracted the largest volume of women aged 25-34 in the "Young Cosmopolitan" segment were Tourism Australia, The Westin Hotels and Resorts and Cruise Critic for the four weeks ending 03/13/10. This is according to Hitwise Lifestyle, which incorporates MOSAIC USA, a leading household segmentation system.
The Young Cosmopolitan Type consists mostly of adults that are under 35 years old, single and earning above average incomes as white-collar professionals, executives and managers. As consumers, they support high-end stores like Bloomingdale's, J. Crew and Victoria's Secret. They're also big purchasers of all sorts of tech gear, including BlackBerry devices, iPods and Xbox consoles. More and more, they're spending their free time online, going to news and travel sites and checking out social networking forums in search of a date or a mate. Lifestyle data is available on over 30,000 websites.
Top travel - destinations and accommodation websites visited by US females aged 25-34 for the four weeks ending 03/13/10:
1. Tourism Australia www.australia.com: 43.18% of females / 26.82% are aged 25-34 / 5.28% "Young Cosmopolitan" MOSAIC USA Segment
2. The Westin Hotels and Resorts www.starwoodhotels.com/westin: 47.52% / 34.57% / 3.56%
3. Cruise Critic www.cruisecritic.com: 48.79% / 23.71% / 4.94%
4. King County, Washington www.kingcounty.gov: 49.35% / 14.13% / 7.81%
5. Best Western International www.bestwestern.com: 55.51% / 20.65% / 4.74%
(Hitwise North America Newsletter - March 2010, March 2010)
US travellers made an average of 21 visits to various travel Web sites in 2009 before finally booking a trip, according to figures by Compete.com. That's a lot of time surfing the Web and a possible business opportunity for travel sites that can make that search faster and easier.
These meta-search sites (among them, Kayak.com, Fly.com and Momondo.com) don't sell plane tickets or control bookings at hotel rooms. Rather, they search hundreds of travel sites at once in a quest to identify the best rates and then send consumers to book directly at the seller's site.
All have recently been raising their profiles: Kayak with a new TV ad campaign that trumpets its supposed primacy ("Search One and Done"); Momondo, a Danish company, with a site that boasts it is "the best flight search engine" on the Web; and Fly, with one-on-one sessions with reporters from The New York Times and other publications asserting that its fares either match or better Kayak's in "46 of 50 top markets."
Kayak, Fly and another meta-search site, Bing Travel from Microsoft, all work with ITA Software for certain search capabilities and access to fares. ITA pulls fares from the Airline Tariff Publishing Company, which collects prices from 500 airlines worldwide. That means many of the meta-search sites are dipping into the same pool of data. (HOTELMARKETING.COM, February 2010)
Most US internet users (52%) this year opt not to travel this holiday season, according to a survey byAbout.com. Another 24% said they were even less likely to travel this year than last. The biggest theme for those still planning to travel is spending less money and researching online more. Two factors that are probably connected, since respondents thought Web research was the single best way to save on travel. The growing number of non-transactional sites has begun to siphon consumers from transactional sites during the earlier phases of travel planning, according to findings from PhoCusWright's Online Traffic and Conversion Report. The study, conducted in partnership with Compete Inc., found that over the past few years, traffic to non-transactional sites has increased from 29% of all travel category visitations to 33%. Non-transactional sites clearly play a role in influencing travellers, and impact both traffic and conversion rates on transactional sites. - Lead generators (such as like TravelZoo and BookingBuddy.com): they represent the largest non-transactional category, though they experienced a noticeable decline in 2009. These sites received nearly 15 million unique monthly visitors on average in 2Q2009. The decline in traffic to lead generator sites was likely caused in part by the increased popularity of metasearch sites. - Meta search sites: this category has sustained substantial traffic increases, contributing significantly to the growth of the non-transactional category as a whole. - Planning and reviews sites: this category experienced the most dramatic growth trajectory doubling its traffic over two years. - Travel guides sites: this category has also posted gains, adding over 4 million unique monthly visitors since 2Q2007. - Destination and tourism category: the only non-transactional category that has remained relatively stagnant. It consists of destination marketing organizations and other destination-specific travel Web sites. (PhoCusWright FYI October 2009, October 2009) Travel Web sites are performing well in the midst of the broader travel industry downturn, according to a study by PhoCusWright Inc conducted in partnership with Compete Inc.. Most Americans are still making their travel plans offline, according to the "Travel and Vacation Services-Summer 2009" report from Ad-ology Research. The survey revealed that only some 47% of US adult internet users had used the Web recently to research travel. The most common travel-related topics to check out on the internet included airfare, researched by 34% of respondents, hotel/motel rates and availability (30.8%) and car rentals (14.3%). The vast majority (77%) of Ad-ology respondents said social media did not influence their travel or vacation decisions, but there is evidence that travel companies can do well among the 23% who said they were influenced by social media.
Ways that US internet users are reducing the amount of money spent on leisure travel, September 2009 (% of respondents):
- Researching online for deals prior to travelling: 46%
- Participating in local activities (parks, picnics, festivals): 45%
- Seeking less expensive hotels and accommodations: 36%
- Seeking less expensive meal options: 35%
- Driving instead of flying: 32%
- Seeking less expensive activities: 31%
- Vacationing closer to home instead of overseas: 30%
- I do not plan on travelling at all this year: 25%
- Staying with family/friends instead of a hotel: 25%
- Looking for all-inclusive packages: 23%
- Sharing costs with family/friends: 19%
- Taking fewer smaller trips and saving for one larger vacation: 17%
Money-saving attitudes, unsurprisingly, have an effect on what kinds of ads are most likely to reach consumers. Asked which online travel advertisements they were most interested in, large majorities of respondents wanted coupons on big-ticket travel items: airfare (70%) and hotels (67%). Package deals and discounts on activities and food appealed to nearly one-half of respondents.
Travel industry display ad impressions were up 28% between August and September 2009, according to Nielsen. (eMarketer, November 2009)
There are many different types of non-transactional Web site categories, each filling a particular role in the search, shop, buy process:
Non-transactional Web sites are beginning to lessen consumers' reliance on the major OTAs for product information. This certainly does not mean that OTAs have lost consumer value, but the travel planning process has become less linear over time, with multiple categories of travel sites forming a complex web that leads ultimately to a transaction.
Summary of traffic to travel categories* (monthly unique category visitors):
- 2Q 2007: 71% transactional sites / 29% non-transactional sites
- 2Q 2008: 67% / 33%
- 2Q 2009: 67% / 33%
* Category unique visitors who visit multiple categories would be counted each time they visit a different category.
The study shows that monthly traffic and conversion is up in almost all travel categories in the second quarter of 2009, compared to the same quarter of previous years.
PhoCusWright says that despite the downturn, transactional Web sites (i.e., suppliers and online travel agencies) showed strong growth in June monthly visitors year-over-year, with cruise lines up 19% and hotel chains up 13%. Online travel agencies (OTAs) also showed slight increases in hotel and car rental visitor volume in the first half of 2009 compared to 2008 and 2007.
The only category to show a decline in traffic from 2008 through 2009 was the OTA air category which is down 15%. This is not reflective of weak performance however, as OTA air conversion has increased significantly over the same time period, says the travel site.
Carroll Rheem, director, research at PhoCusWright believes that the reliance that consumers have on travel Web sites has not weakened and adds that online channels are attracting, engaging and inspiring travelers who recognize that this year is actually a fantastic time to take a trip. Consumers are certainly spending less, but they are not giving up travel, nor are they turning away from the Web sites that offer them the selection and convenience they value. (Travelmole, September 2009)
US internet users who have used the internet to research travel-related topics, 2009 (% of respondents):
- Airfare: 34.0%
- Hotel/motel rates and availability: 30.8%
- Car rental: 14.3%
- Cruises: 10.3%
- Adventure vacation: 10.0%
- Train travel: 6.3%
- Casino vacation: 4.4%
- Guided tour : 3.8%
- Bus tour : 2.8%
- Out-of-town sporting events: 2.8%
- Travel agent/agency: 2.6%
- Golf vacation: 1.7%
- Other: 1.2%
- None: 52.9%
However, 39% of recent travellers said online media influenced their choice of travel services.
According to analysis on the Compete blog, visitors to airline sites in July 2009 were six times more likely to visit Twitter than the previous year. The research firm also found a correlation between airline booking success and the promotion of low fares via the microblogging service. (eMarketer, September 2009)
"hotels.com" was the top search term for the Travel Destinations and Accommodations category in the US in July 2009, according to Hitwise.
Top 10 search terms for the Travel Destinations and Accommodations category in the US, July 2009:
1. hotels.com: 0.70% of search volume
2. six flags: 0.32%
3. carnival cruise: 0.26%
4. disney world: 0.24%
5. trip advisor: 0.20%
6. cedar point: 0.20%
7. disneyland: 0.20%
8. holiday inn: 0.19%
9. great wolf lodge: 0.18%
10. hershey park: 0.17%
(ClickZ Network, August 2009)
Travellers expected to have the skills of agents are getting fed up with the complicated process of planning and booking a trip, according to a study by Forrester Research entitled ‘Using Digital Channels to Calm the Angry Traveler'.
The growing dissatisfaction with the new do-it-yourself type of travel was evident in the Forrester Research study that found that:
- 15% fewer US travellers enjoyed using the web in 2009 than they did in 2007.
- Just 33% of US online travellers feel that travel websites do a good job presenting travel choices, down from 39% in 2008.
Forrester Research believes that US travellers feel they are taken for granted, indicating that consumers see other websites becoming easier to use (retail websites, banking websites, media websites) but travel is treading water as a category. There are very few travel companies that are really looking to improve the planning and booking process. Instead, customers are forced to figure out extra fees, wade through fine print and understand industry terms like the difference between a deluxe and a standard room, in addition to educating themselves about destinations, flights and hotels. (Travelmole, August 2009)
DiscoverAmerica.com is celebrating its first year as the Official Travel and Tourism Website of the United States by announcing a slate of content upgrades, site enhancements and money-saving deals to help travellers plan trips to the USA.
Traffic to the site and time spent viewing its content has been very favourable in its first year. Daily site traffic increased 254% overall since its initial launch period in the Summer of 2008. Users have spent more than 3 million minutes researching US trips and have viewed four million pages of travel content.
Unique features of the website include the Activity Finder, which houses information on more than 2,600 activities in 24 popular trip categories, such as art galleries and museums, shopping, food and wine, and beaches and coasts. The Interactive Map tool located on the Places page helps users identify approximate distances between US locales.
Created one year ago under a cooperative agreement between the US Travel Association and the US Department of Commerce-Office of Travel and Tourism Industries, DiscoverAmerica.com is actually a suite of international sites designed for travellers from Canada, Mexico, the U.K., Japan and Germany, the top five markets representing about 75% of all inbound visitation to the United States.
Strategic content partners on DiscoverAmerica.com include official sources such as state tourism offices, convention and visitors bureaus, the US Department of State, the US Department of Homeland Security, American Express, Fodor's, Google Maps and Weather.com. (TravelDailyNews, August 2009)
Google released in July 2009 a study entitled "The Traveler's Road to Decision" that reveals consumer research and buying habits across the internet. Consumers rely on search engines throughout the trip-planning process more so than travel search sites, although online travel agencies remain strong with 55% looking for business accommodations vs. 52% for personal.
The study finds that 64% depend on search engines to plan personal trips vs. 56% for business. When it comes to searching for information on hotels, 81% rely on search engines when looking for business overnight accommodations vs. 67% personal; 74% business air travel vs. 59%; 60% destinations vs. 59% personal; and 51% vacation activities vs. 55% personal.
To find the best deals, consumers will search the internet for information more often than any other source. So it would make sense that reviews influence the purchase decision, with 41% revealing they made personal plans vs. 50% for business based on reviews of others.
An increasing number of travellers contribute to these reviews, too. In a similar study conducted in April 2008, only 9% of travellers surveyed had posted a review, 5% commented on a review, and 3% participated in a travel-related blog.
Travel videos have also become important as people plan trips. They help people to visualize the surroundings and make better choices on where to stay and what to do. Videos created by peers are looked upon as being more trusted, compared with the videos that companies create to peddle goods and services. (HOTELMARKETING.COM, July 2009)
The role of user-generated reviews is exploding. Nearly 1 of 5 North American travellers say they read online guest reviews of hotels before booking and about 1 in 10 travellers will write a review after their stay in Q1 2009, according to the latest Market Metrix Hospitality IndexTM by Market Metrix. The percentage of travellers who read reviews prior to booking a hotel has remained stable for the past year, but the number of persons who are writing reviews about their hotel stay is rising.
Percentage of North Americans travellers who write a "customer review" after their stay:
- Q1 2009: 8.6%
- Q4 2008: 8.4%
- Q3 2008: 7.8%
Based on the results from the latest Market Metrix Hospitality IndexTM, people who write reviews after their stay are happier with their experience compared to guests who did not post a review. And this difference extended to guest loyalty. Guests who wrote a review after their stay were 20% more likely to recommend the hotel and 40% more likely to return, compared to guests who did not write a review. Guests who write reviews tend to be older; guests who read reviews tend to be younger. More leisure guests write reviews of their stay compared to business travellers.
Luxury guests (12.7%) and Timeshare guests (14.3%) were more likely to write reviews. Casino guests were least likely (7.2%) to post a review of their hotel experience. Among all hotels, Affinia Hotels had the largest percentage of guests (35.8%) who posted reviews about their stay. (TourismExchange Company, June 2009)
When travelling domestically, 20% of North Americans will read user reviews before booking a hotel; that number jumps when North Americans travel overseas, according to the latest Market Metrix Hospitality IndexTM by Market Metrix.
When going to Europe, 33% of travellers will look to user reviews for assistance in finding the right hotel. The biggest jump occurs for travellers to Mexico and Latin America where nearly half of travellers will read online hotel reviews prior to making their reservations.
Persons travelling to the Middle East are most likely to write a review (26%) while persons travelling within the US are least likely (8%) to share their experience online. (TourismExchange Company, June 2009)
66% of leisure travellers now use the internet to plan some aspect of their travel (versus 35% in 2000), while 56% now report making reservations online, according to a study by Ypartnership entitled National Travel MONITORSM. Only 1% of travellers commence their search for a vacation destination by visiting a blog.
The nationally representative survey of 1,590 active travellers was conducted during the months of February and March, 2009, and is co-authored annually by Ypartnership and Yankelovich, Inc.
The study finds that US Travellers visit search engines such as Google, Yahoo or MSN first (34%) when considering vacation destination alternatives. The Web sites of specific countries or destination boards are visited next (23%), followed by online travel agencies such as Expedia and Travelocity (22%).
While the percentage of leisure travellers who report making reservations online has grown more than 37% since the year 2000, consumers' search behaviour has changed in recent years as people have become more familiar with search technology and the number of travel planning/purchasing sites has grown exponentially, according to Ypartnership.
Search patterns for selecting an airline or lodging accommodation are understandably different. Consumers who are searching for these travel services first visit the Web sites of online travel agencies (42% and 31%, respectively). Brand-specific sites (41%) follow closely when leisure travellers are selecting an airline, yet significantly less so when they select lodging (21%). Meta search engines that compare fares are visited first by over one-out-of-ten travelers (13%) when selecting an airline. (Ypartnership, May 2009)
More than half of US travellers use the internet to select a leisure destination, according to PhoCusWright's Consumer Travel Report Part One: Behavioral Trends. But consumers use DMO Web sites for far more than just destination selection. Consumers are as active on DMO Web sites after they book their travel as they are when planning and shopping for their trip. Destination marketers are facilitators of travel at all points in the travel planning process and must orient their online services to facilitate pre- and post-booking needs of travellers.
Time between visiting a destination website and completing a booking on a transactional website:
- Book 1-10 days after visiting destination website: 44%
- Book 1-10 days before visiting destination website: 42%
- Book on same day: 14%
PhoCusWright's Destination Marketing: Understanding the Role and Impact of Destination Marketers offers detailed best practices for DMOs to serve all points of the travel planning process. The report provides insight into what travellers are looking for from DMO Web sites during the planning, shopping, booking and post-booking stages, and delivers recommendations for offering online booking or referral services. (PhoCusWright, June 2009)
Webby Awards go to fewer than 15% of the more than 10,000 entries received from more than 60 countries. Pennsylvania's entries visitPA.com and newPA.com were recognized for creativity, functionality and overall excellence.
VisitPA.com is the official travel and tourism site for visitors to the state. In September 2008, the site was redesigned to provide visitors with a more in-depth conversation about Pennsylvania. The more a visitor is engaged, the more likely they are to plan a trip in Pennsylvania.
NewPA.com was designed to be a tool for business decision-makers and community leaders to explore the wide range of programs, resources and business incentives available in the commonwealth.
Established in 1996, the Webby Award is presented by the International Academy of Digital Arts and Sciences, a 550-member body of leading Web experts, business figures, luminaries, visionaries and creative celebrities. (TravelMole, May 2009)
The majority of meeting and event planners prefer social networks that build upon, instead of replace, personal relationships, according to an HSMAI Affordable Meetings West pre-conference survey.
61% of meeting planners attending the 13th Annual Hospitality Sales & Marketing Association International's (HSMAI) Affordable Meetings West Conference & Exposition in California in June 2009, stated that they were engaged on Facebook, and 58% were members of LinkedIn. Networking and maintaining relationships were the top benefits cited. Just 13% said they were using Twitter.
Technology continues to be a top priority in 2009 with 70% of planners reporting an increase in technology use in meetings management and marketing. Of those respondents, 74% commented that the incorporation of the various technologies made their jobs easier. 30% of planners also cited that they would be looking for event planning software suppliers at this year's exposition. (HOTELMARKETING.COM, June 2009)
Search engines continue to be the primary way internet users navigate to key industry categories, according to Hitwise. Comparing April 2009 with April 2008, the travel category showed a 36.82% in its share of traffic coming directly from search engines and 27.91% coming directly from Google.
US category upstream traffic from search engines - April 2009:
- Health and Medical: 46.29% (+1% compared to April 2008)
- Travel: 36.82% (+8%)
- Shopping and Classifieds: 24.04% (-5%)
- News and Media: 21.35% (-2%)
- Entertainment: 26.51% (+11%)
- Business and Finance: 20.91% (+16%)
- Sports: 14.93% (+20%)
- Online video: 36.04% (+25%)
- Social Networking: 17.73% (+6%)
US category upstream traffic from Google - April 2009:
- Health and Medical: 33.88% (+10% compared to April 2008)
- Travel: 27.91% (+20%)
- Shopping and Classifieds: 17.28% (+4%)
- News and Media: 15.48% (+6%)
- Entertainment: 18.78% (+24%)
- Business and Finance: 15.01% (+29%)
- Sports: 10.88% (+30%)
- Online video: 27.24% (+39%)
- Social Networking: 11.87% (+18%)
(Hitwise, May 2009)
The US Travel Association, in conjunction with all 50 state tourism offices and more than 100 convention and visitors bureaus, has launched DiscoverAmerica.com. This one-stop travel planning source features special deals and offers. The site's 7,000 pages feature official content on all 50 states, the five U.S. territories, more than 100 cities and regional destinations, and more than 3,000 popular trip activities.
DiscoverAmerica.com compiles the most-trusted and official sources in travel, from state tourism offices and convention and visitors bureaus to agencies such as the National Park Service and Scenic Byways. Other reliable brands in travel information such as American Express, Fodor's, Google Maps and Weather.com are also represented.
It allows users to search activities by time of year or by nine different geographic regions. The site also features an Interactive Map where users may plot the approximate driving distances between two locales; just click and drag the map's points to determine the mileage between any two places on the US map.
DiscoverAmerica.com also hosts a community section.
The website's content is presently available in five languages: English, French, Spanish, German and Japanese. (EyeForTravel, May 2009)
The collective power of the average traveller is now greater than any other online information source, according to PhoCusWright's Consumer Travel Report. Travel 2.0 (Consumer Generated Content) has overtaken expert editorial and even photography.
More specifically, consumers are looking to online travel agency (OTA) user reviews the most-representing a critical component of OTAs' dominance as the traveller shopping tool of choice. 71% of online shoppers typically use OTAs when selecting travel products, and they are reading the reviews where it is most convenient for them.
Influential features in leisure travel planning (incidence of slightly / very influential) among US travellers:
- Traveller reviews on online travel agencies: 50%
- Traveller generated photography/virtual tours: 43%
- Online travel reviews from travel experts: 41%
- Professional photography/virtual tours: 39%
- Travellers review Web sites: 33%
- Professional online travel video: 29%
- Travellers generated online travel video: 28%
- Travel blogs or online travel diaries: 22%
- Social networks / people you know: 22%
- Social networks / people you do not know: 15%
- Travel-related podcasts: 13%
(PhoCusWright FYI - 07/04/09, April 2009)
Travel sites experienced seasonal gains in the US in February 2009 sparked by spring travel planning, according to comScore. The Online Travel Agents category grew 1% to 39.5 million visitors, led by Expedia, Inc. with nearly 23 million visitors. Orbitz Worldwide ranked second with nearly 14 million visitors, followed by Priceline.com Inc. with 9.7 million visitors.
The other travel categories that experienced increases included the Travel - Information category, led by TravelAdNetwork with 10.4 million visitors, and the Travel - Hotel/Resorts category, led by Hilton Hotels with 4.7 million visitors. (HOTELMARKETING.COM, March 2009)
Customer satisfaction with online travel remains unchanged in aggregate year-over-year, though the industry has been slowly decreasing since 2002, according to the American Customer Satisfaction Index (ACSI) report by Foresee. The industry is going to need more than a boost in customer satisfaction in the wake of what industry experts predict to be the worst year for business and leisure travel since 2002, it has been highlighted.
Expedia (+2.7%) and the All Others category (-2.5%) tie for first at 77. Travelocity comes in second place (+2.7% to 75) followed by Orbitz (+1.4% to 74). Priceline.com falls one percent to 72.
Customer satisfaction with the e-commerce sector in general has gone down for the first time in three years, dropping 2% to a score of 80 on a 100-point scale. The decline is driven by a dramatic plunge in customer satisfaction with online brokerages, which were hit hard by the fallout from the financial crisis that erased billions of dollars of investment capital.
The annual ACSI e-commerce report measures customer satisfaction with online retail, online brokerage, and online travel. (EyeForTravel, February 2009)
Travel Booking
According to PhoCusWright's Consumer Travel Report Second Edition, the top reason U.S. travelers give for booking offline is that they were seeking personal service. On the other hand, security concerns and technology issues, once a significant deterrent of online bookings, are no longer a major factor. Just 7% of offline bookers say they do not want to submit credit card information online, and roughly the same percantage do not feel the information they see online is accurate. Only 9% of those who book online cite technical issues or frustration with the Internet as the reason.
While discomfort with technology and the internet is no longer the main driver of offline bookings, a number of other perceptions appear to be preventing some transactions from moving to the online channel. The number two and three reasons for booking offline relate to perceptions-or perhaps, misperceptions-about differences between online and offline booking. Specifically, 21% of travelers who book offline feel they can get a better deal when they call or visit a travel agent or supplier. In addition, 16% believe they would get better customer service (when booking offline) if something goes wrong.
Clearly, an opportunity exists for any travel company that wants to shift transactions from their call center to their website. The challenge is to dispel the notion (which may or may not be accurate) that there are significant differences in pricing and/or customer service between online and offline channels. By communicating a clear and consistent pricing policy, and establishing messaging that instills greater confidence in customer service, travel companies may convince resistant consumers to shift their bookings online.
(HOTELMARKETING.COM, June 2010)
While too-high prices were the main driver to booking abandonment, a litany of site-related complaints followed, including not wanting to register, slow loading times, and general frustration or confusion, according to a January 2010 survey of US online travel bookers by PhoCusWright.
Reasons that US online travel bookers do not complete online transactions, January 2010 (% of respondents):
- Final product price and/or fees were higher than I was willing to pay: 43%
- I did not want to register with the Website: 11%
- Not enough inventory (What I wanted to purchase was not available): 11%
- Website was too slow/took too long: 11%
- Website was asking for too much information: 9%
- Website was frustrating/confusing to use: 9%
- Checkout process was too long or confusing: 6%
- I was unwilling/unable to give my credit card information online: 6%
- Website crashed/Webpage froze/received error page: 5%
- Other 3%
- Have never abandoned site from which intended to make purchase: 30%
These problems can also prevent travel bookers from returning in future. More than a third of all travellers told PhoCusWright that site problems would make them less likely to shop again. Business travellers, who are more likely than leisure travellers to book a trip on any given travel site visit, were especially harsh in their condemnation. They were more likely than average to say they would immediately turn to a competing travel site (23%) and tell friends, family and co-workers about their bad experience (14%).
Website performance monitoring firm Gomez found in December 2009 that nearly a fifth of US online buyers had experienced slow load times on travel sites, and 11% had had problems completing transactions. A majority of respondents would give up after just one or two bad experiences on a site.
The "Hospitality & Tourism Industry Report, Q4 2009" from customer satisfaction measurement firm iPerceptions also indicated that after price considerations, convenient, hassle-free Websites with high measures of responsiveness led to the most completed bookings. (eMarketer, May 2010)
Usage of the internet for researching, discussing and booking leisure and unmanaged business travel in the US has shown surprising resilience during the global recession, terrorism scares, flu-pandemic fears and continued economic uncertainty. Though sales declined 6.7% in 2009, US online leisure and unmanaged business travel sales growth will begin to accelerate in 2010, peaking at 7% in 2012, when sales will hit $105.4 billion, according to eMarketer.
eMarkter believes that online will grow to make up an even greater percentage of the total travel market in the post-recessionary environment.
US online leisure/unmanaged business travel sales, 2008-2014:
- 2008: $94.7 billion (+7.1%)
- 2009: $88.4 billion (-6.7%)
- 2010: $92.5 billion (+4.6%)
- 2011: $98.5 billion (+6.5%)
- 2012: $105.4 billion (+7.0%)
- 2013: $112.2 billion (+6.5%)
- 2014: $119.0 billion (+6.0%)
Amid the sales recovery, six key trends will be critical to online travel companies seeking to break away from the increasingly crowded yet fragmented pack:
1. Value takes centre stage: Amid the economic rubble, travellers have adopted a back-to-basics mentality, seeking quality at the right price.
2. Social media gives rise to new ways of sharing: Online reviews and user-generated content are being combined with social networking, increasing their influence on travel-buying decisions.
3. Mobile takes travel on the go: A growing number of travellers now use mobile devices to plan and book trips and access location-specific content.
4. Personalized micro-niche travel takes off: Growing dissatisfaction with one-size-fits-all travel is driving demand for customized offerings.
5. Online travel spans new horizons: Growth in online booking is shifting overseas, while US travellers who book online are looking for more international options.
6. Sustainable is becoming attainable: Suppliers who deploy green practices are enjoying favoured status among acutely aware consumers.
(eMarketer, April 2010)
Hotel internet bookings increased by 6.6% in 2009 compared to 2008 and now account for 54% of all bookings, according to TRAVELCLICK's eTRAK report. This represents $2 billion in hotel revenue, according to PhoCusWright. This is the third year of consecutive growth in the online channel since eTRAK reporting began in 2006.
Driving the proliferation of Web bookings are such new and evolving online channels as mobile applications, social media, and behavioral networks. The mobile channel generated nearly $80 million in revenue in 2008 and 2009, according to PhoCusWright. This number is significantly higher than the revenue from booking air travel (around $60 million) or rental cars (around $20 million) through the mobile channel.
Social networking sites have emerged with similar speed. According to Gartner, networking will be the most popular online activity by 2012, overtaking shopping and surpassing communication and entertainment.
Alongside these emerging technologies, the Global Distribution System (GDS) continues to be important for many buyers and contributes significantly to hotel distribution revenue - about 24% in 2009, according to eTRAK. Also, GDS hotel promotions, appearing when agents search the air, car, and hotel availability screens within their GDS, still have an influence on bookings. Research has found that the more useful, accurate, and visually engaging the information provided by hotels in the GDS environment, the more agents will rely on the system to book travel for their clients. (HOTELMARKETING.COM, March 2010)
US travel industry bookings are expected to total US$291 billion in 2010 while online transactions will reach US$90 billion, according to PhoCusWright. Mobile bookings are to reach US$160 million during the same period, according to PhoCusWright's Mobile: The Next Platform for Travel report.
While mobile booking is still in its infancy, there is vast growth potential for mobile applications that drive bookings and revenue. Travel companies that build effective mobile strategies to target early adopters will be in prime position to lead the coming mobile revolution in travel. These early adopters tend to be young, and, most importantly, frequent travellers. (PhoCusWright FYI - 05/02/2010, February 2010)
The 2009 to 2014 outlook for US online leisure and unmanaged business travel sales is rather mixed, according to a report by Forrester Research entitled "US Online Leisure Travel Forecast, 2009 to 2014: The Plateau Is In Sight".
The era of double-digit growth among US online leisure travel bookers and sales is fading. Between 2009 and 2014, Forrester expects that online sales will remain below those estimated in their 2008 forecast. The number of US leisure travel bookers will grow by just 3.5% during the next five years, while online leisure and unmanaged travel sales will grow 7%, according to Forrester Research. (Forrester Research, January 2010)
Relatively low percentages of US Web users ages 18 and older went online to investigate travel-related subjects in 2009 (in comparison to level in some European countries), according to an Ad-ology Research. Airfares were the most popular travel-related topic, with 34% of respondents saying they had recently checked out flight costs online. But less than 31% of internet users said they had searched for information on rates and availability at hotels and motels.
US internet users who have used the internet to research travel-related topics, 2009 (% of respondents):
- Airfare: 34.0%
- Hotel/motel rates and availability: 30.8%
- Car rental: 14.3%
- Cruises: 10.3%
- Adventure vacation: 10/0%
- Train travel: 6.3%
- Casino vacation: 4.4%
- Guided tour: 3.8%
- Bus tour: 2.8%
- Out-of-town sporting events: 2.8%
- Travel agent/agency: 2.6%
- Golf vacation: 1.7%
- Other 1.2%
- None: 52.9%
(eMarketer, January 2010)
Compete led a workshop at the PhoCusWright conference in Orlando, FL that provided a high-level pulse on the travel industry's level of recovery based on data through September 2009. One of the conclusions was that different travel categories (hotel, cruise, air, car rental) have recovered at different rates. The analyses were based on the number of visitors to sites in aggregate that represent those industries (suppliers and category-specific sections of OTAs). Note that each visitor is counted only once in a month in a travel category. Someone who visits than one hotel site in the same month is counted only once in the hotel totals for that month. The data presented at PhoCusWright are updated here to include results through October 2009.
Compete analysis suggests that the hotel and cruise categories recovered faster than did airlines and car rental, based on comparing monthly 2009 results vs. the same period in 2008. The hotel and cruise categories posted sustained year-over-year gains starting in early 2009 with aggregate traffic in 2009 above 2008 levels in all months. The gains coincide both with the US emerging from the recession but, as important, very aggressive price cutting and deal creation by the travel industry. The results also highlight the dip in consumer traffic during the brunt of the recession (Q4 2008) and more so than simple seasonal patterns would suggest.
In contrast to the hotel and cruise industries, the airline and car rental industries took longer to recover. Sustained airline traffic did not lift year-over-year until July 2009; sustained car rental year-over-year gains did not start until June 2009.
Airlines and Car Rentals also show the effects of the Q4 2008 recession bottom. Both had 2008 Q4 traffic below Q4 2007, with Car Rental showing the longest and deepest drop in that period among the four categories shown.
In summary, all four categories are showing signs of recovery, and in general consumer research levels are leading indicators. But results here are based on domain level visits: a deeper assessment would include consumer engagement (deeper funnel steps like conducting a search or choosing an itinerary) and actual bookings. A true recovery will be supported by more overall research by travellers, more engagement, and more bookings - coupled with a return of pricing power. (Compete, December 2009)
As 2009 is coming to a close, the big question on the minds of many is the outlook for 2010 and 2011. The recovery will likely be slow, bringing only incremental improvements over several years, according to PhoCusWright's U.S. Online Travel Overview Ninth Edition. As a result, PhoCusWright projects very modest growth of 1% for the total travel market in 2010, as consumers and corporations gradually increase their travel spending. Online travel will continue to benefit from its positioning as a discount and distressed-inventory channel amid soft overall demand and a weak pricing environment for travel suppliers, especially hotels Online travel will grow 5% in 2010, far outpacing the total travel market. (PhoCusWright FYI, December 2009)
Companies no longer need to sell travel to be a major online travel player. Over the past several years, the online travel marketplace has evolved to include a full range of non-transactional web sites that complement and at times compete with transactional sites for consumer attention, according to PhoCusWright.
Travel sellers must consider the special positioning of these new intermediaries and the extent to which non-transactional travel sites influence travelers' purchasing decisions. Non-transactional sites are those whose primary purpose and revenue model is something other than directly selling travel. These sites generally include travel media sites, travel referral sites and metasearch.
PhoCusWright explains that before consumers ever hit the 'book now' button, they undergo a whole process of gathering, qualifying and comparing travel options. Both metasearch and review sites are designed to help consumers in this often cumbersome decision-making process. Therefore, it is not surprising that the popularity of these types of web sites has grown significantly over the past several years.
PhoCusWright partnered with Compete to examine metasearch and planning and review Web sites to determine the impact they have on the conversion rates of shoppers who visit them. As of June 2009, Kayak is by far the most significant site in the metasearch category, leading with nearly 7 million monthly unique visitors. TripAdvisor and Kayak represent two of the most exciting brands in the travel space today and they both offer a multitude of products.
Non-transactional sites were found to benefit suppliers more than they benefit online travel agencies (OTAs). Supplier shoppers who also visit non-transactional sites exhibit an increase in conversion rates across all products and categories. For OTA shoppers, cross-visitation with non-transactional sites often corresponds to either no increase or a decline in conversion rates. (PhoCusWright FYI, December 2009)
The US hotel industry has suffered greatly amid the US recession. Total hotel room revenue has been in freefall with double-digit declines for 2009, according to PhoCusWright's US Online Travel Overview Ninth Edition: Hotels. This will bring online hotel sales down for the first time since PhoCusWright began tracking the market in 1998. But online leisure/unmanaged business hotel bookings (with a projected 2009 decline of just 4% to under US$27 billion) will still markedly outperform the broader hotel market. Online travel agencies (OTAs), once hotels' online nemeses, will actually see their aggregate hotel sales climb in 2009.
After years of notable market share gains by hotel Web sites over online travel agencies, the severity of the US recession has turned those competitive dynamics entirely upside-down. Considered adversaries just a few years ago, OTAs have been essential distribution partners, able to generate bookings amid a significant overall slump in demand, according to PhoCusWright. (PhoCusWright FYI 01/12/09, December 2009)
Far from embracing the do-it-yourself era, many consumers are fed up with the complicated process of planning and booking travel, according to a report by Forrester Research.
What we've seen is growing frustration, according to Henry H. Harteveldt, a Forrester travel analyst. Consumers see other Web sites becoming easier to use - retail Web sites, banking Web sites, media Web sites. But travel is treading water as a category. There are very few travel companies that are really looking to improve the planning and booking process.
Instead, customers are forced to figure out extra fees, wade through fine print and understand industry terms like the difference between a deluxe and a standard room, in addition to educating themselves about destinations, flights and hotels. Travel companies expect the consumer to behave like a travel agent, according to Henry H. Harteveldt. (HOTELMARKETING.COM, August 2009)
At STR Hotel Data Conference in Nashville, Brian Ferguson, VP of lodging demand and analysis for Expedia, shared 10 interesting hotel trends using data generated from hotel bookings on Expedia:
1. Exchange rates are shifting travel patterns: there are a lot more Americans travelling to the UK despite the economy. That's simply because it has gotten so much cheaper. It's 35% cheaper just because of the exchange rate. Add to that the discounts UK hotels are giving, and it's become a bargain.
2. Consumers are looking for a deal: Year-over-year share of bookings with promotions has increased and will continue to do so throughout the third-quarter of 2009.
3. Promotions matter more than ever: Year-over-year percent change on rooms booked with major promotions has increased in 2009. There were 68% more travellers who booked their stays during a 4th of July promotion this year than last year, for example.
4. Promotions are getting more creative: Before, it used to be all about cutting rates on the sites, now, hotel companies are offering free nights, value-add packages and other incentives to drive demand.
5. Customers who book online are trading up: Customers are finding that the four- and five-star hotels are getting more affordable.
6. There are massive swings in online market share: In Nashville, Tennessee, for example, the most booked hotel during second-quarter 2009 jumped 13 spots before landing in that position and increased year-over-year room nights by 413%. However, its year-over-year ADR declined by 34%.
7. Booking window compression: Travellers are waiting longer than ever before to book their stays.
8. Leisure rates are leading the way: Leisure rates went down first and are going down more.
9. Hotels are using the package channel to fence rates: Examples of this semi-transparent technique including bundling a hotel stay with airfare or a stay with a car rental.
10. Opaque channels are growing faster than non-opaque channels.
(HOTELMARKETING.COM, August 2009)
Increasing visitor share is important as a key measure of DMO success, but so too is increasing spend. Consumers who begin and end their travel shopping exclusively online have a significantly higher average annual travel spend than offline shoppers, according to PhoCusWright's Consumer Travel Report. In fact, travellers who select their destination online and book online spend on average almost twice as much as travellers who do some of those activities offline.
Incidence of internet usage in the travel planning process and annual household travel spend:
- Selected destination online / Purchase online: $4,066 average annual spend
- Selected destination online / Purchase offline: $2,490
- Selected destination offline / Purchase online: $2,568
- Selected destination offline / Purchase offline: $1,938
(PhoCusWright, July 2009)
US online travel sales will total nearly $92.6 billion in 2009, down from $95.3 billion in 2008, according to eMarketer. But, assuming the recession ends in 2009, as many economists predict, the forecast indicates that online sales will begin to rebound in 2010 and hit full stride in 2011 when online travel sales are predicted to reach $102.8 billion.
US online travel sales (online leisure and unmanaged business travel sales), 2008-2013:
- 2008: $95.3 billion
- 2009: $92.6 billion
- 2010: $95.2 billion
- 2011: $102.8 billion
- 2012: $110.5 billion
- 2013: $117.7 billion
Everyone focuses on the downturn in the overall economy, but the recession has only accentuated the gradual decline in online sales growth over the past few years. The decline would likely have occurred even in normal economic times, according to eMarketer. (eMarketer, June 2009)
Recessionary markets provide extraordinary opportunities to observe shifts in consumer behaviours and attitudes. PhoCusWright projects that the total US travel market will decline 11% in 2009, returning the industry to pre-2006 levels. This decline reflects a dramatic shift in consumer demand levels, and new research from PhoCusWright's Consumer Travel Report provides valuable insight into the changing behaviour of today's traveller.
PhoCusWright's top US traveller trends include:
- Move over boomers-Generation Y has come of age: 25 to 34 year olds are spending the most per household on travel and 18-34 year olds are significantly more likely than older age groups to indicate that they plan to travel more this year. While boomers are commonly described as the wealthiest generation, the 45-64 age group is spending the least per household on travel and is also the most likely to reduce travel spend this year.
- It is going to get worse before it gets better: Consumers who spend more than average on travel are more likely to reduce travel expenditure this year, and those that spend less than average are more likely to actually increase travel expenditure this year. The result of this mixed bag of intentions is that overall expenditure will decline considerably across the board, but budget brands will experience a smaller decline than upscale brands.
- Online travel agencies will fare better than other channels: It may seem surprising given the recent flurry of fee cuts and revenue-eroding promotions from online travel agencies (OTAs) like Expedia and Orbitz, but OTAs will outperform other channels in year over year bookings because of their consumer base.
- Online travel is mature but not saturated: Though the majority of travellers typically book online, there is still plenty of opportunity to grow online transactions. Consumers that spend the most on travel still use a mix of online and offline methods.
- Travel search engines are (finally) making a mainstream impact: Travel search engines like Kayak are not new to the travel industry, but are now becoming a mainstream element in the travel planning process. Over a quarter (28%) of travellers typically turn to them when shopping for travel and new entrants like TripAdvisor will continue to broaden the audience.
(PhoCusWright FYI, May 2009)
A sign that online travel has come of age, the online leisure/unmanaged business travel market in the US is projected to decline 3% to US$93 billion in 2009, according to PhoCusWright's updated market numbers from PhoCusWright's U.S. Online Travel Overview: Update 2009-2010.
This marks the first time since PhoCusWright began tracking the marketplace in 1998 that online travel has fallen year-over-year. Representing more than one third of the total travel marketplace, the online leisure/unmanaged business travel market is now more or less mature and far more susceptible to broader swings in the economy and the total travel marketplace.
While online travel will decline in 2009, it will still far outperform the broader travel market and return to positive growth much sooner. With the recession in full swing and leisure and corporate travellers alike pulling back, the total US travel market will decline 11% in 2009 to approximately $241 billion. This returns the total market to pre-2006 levels, when US travel supplier revenue reached $251 billion. The drag on the total travel market is driven primarily by an even sharper decline in the corporate travel and groups and meetings markets.
The travel industry has been experiencing significant declines in both traveller demand and revenue since the financial crisis unfolded; but not all travellers (and not all segments of travel) have been affected in the same way, according to PhoCusWright. Companies mapping their strategies for 2009 and beyond must understand how different segments of the traveller population are responding to current economic conditions and the impact those responses will have on both product selection and booking channels. (PhoCusWright FYI Newsletter, April 2009)
M-commerce will eventually become as commonplace as online shopping, according to a report surveying the frontiers of mobile commerce in the US and Europe, PhoCusWright's Mobile: The Next Platform for Travel. The report finds that US travel industry bookings will reach US$291 billion in 2010 and online transactions will top US$90 billion. The report projects mobile bookings to reach US$160 million during the same period. While the revenue figures remain low, there exists a vast potential for growth for mobile applications that empower mobile travellers, improve travel efficiency and build ancillary revenue.
Consumers with newer mobile devices are ready for advanced functionality. The survey finds that 67% of travellers and 77% of frequent business travellers with Web-enabled mobile devices have used the mobile Web to find local services and attractions. Topping the list among preferred features, 53% of leisure travellers want real-time flight information. Location-based services are also expanding in use and popularity, frequent business travellers expect to receive services such as mapping, navigation services and city guides upon arriving at a destination.
Recalling the revolution TV brought to a business world hooked on radio as a case study, mobile has the potential to reshape the entire travel marketplace. Consumers can expect airlines that offer mobile barcode boarding passes, hotels offering mobile payments for on-site charges and OTAs launching geo-aware travel promotions. (PhoCusWright FYI 08/04/09, April 2009)
69% of US senior internet users aged 64-72 years old went online to make travel reservations in 2008, according to the Pew Internet and American Life Project. The level reached 65% among those aged 73 and older.
Online activities of US senior internet users, by age in 2008 (as a % of each group):
- Email: 91% of those aged 64-72 / 79% of those 73 and older.
- Use search engines: 85% / 70%
- Research products: 73% / 60%
- Get health information: 70% / 67%
- Make travel reservations: 69% / 65%
- Buy something online: 56% / 47%
- Get news: 56% / 37%
- Visit government sites: 60% / 31%
- Bank online: 45% / 24%
- Get religious information: 30% / 26%
(eMarketer, March 2009)
US average search cost-per-click in the travel category reached $0.63 in February 2009, according to data and research provided by Efficient Frontier. This was up from $0.58 in January 2009. (ClickZ, March 2009)
The growth in the online vacation rental sales will accelerate through 2010, when the online vacation rental market in the US will reach nearly $4.7 billion, up from $2.8 billion in 2007, according to PhoCusWright's Vacation Rental Marketplace: Poised for Change report. Vacation rentals have an extremely high satisfaction and repeat rate, if they can entice the leisure traveller to try vacation rental they may find new life-long customers. The developments underway in the vacation rental industry leave the sector well positioned for growth. (PhoCusWright FYI 18 February 2009 Issue, February 2009)
Travel Industry Online Developments
As of the week ending April 11, 2009, Google Maps has now edged past MapQuest with a higher market share of visits in the US, according to Hitwise. While the share of visits is higher for Google Maps, the average visit time on MapQuest remained higher at 10 minutes and 51 seconds as compared to 7 minutes and 24 seconds on Google Maps. Google is the top referral sources for both websites, but is considerably higher for Google Maps with 61% last week while the share of visits referred to MapQuest was 25%.
The case still remains that MapQuest is a strong brand and is the leading search term driving traffic to the Maps category, but there appears to be some erosion that has taken place over time. The share of traffic from the search term ‘mapquest' (which represents 32% of the clicks driving traffic to MapQuest) to the Maps category has declined 32% for the 4 weeks ending April 11, 2009 when compared to the same time frame one year ago.
Albeit amidst some controversy following the launch in the UK, the Google Maps feature ‘Street View' has been very popular and the share of searches on ‘street view' increased 29% for the 4 weeks ending April 11, 2009 when compared to the same timeframe one year ago. Not surprisingly, Google Maps is the main beneficiary of the searches and received 74% of the traffic from the search term during the same timeframe. (Hitwise, April 2009)
Portland, Oregon has become the first US city to launch an official "Twisitor Center" (twitter.com/travelportland). This cyber-style cousin to the more traditional walk-in visitor information centre relies on Twitter technology to connect travellers with those who can answer their questions and help plan their trips. Twitter is a free social-networking service that allows subscribers to send and receive short, real-time updates, messages and questions.
Other cities are connecting with visitors through Twitter, according to GoSeeTell Network, the company that created Portland's Twisitor Centre concept. But Portland is the first city to set up a virtual visitor centre to which people can direct travel questions just by adding a simple tag to their tweets (messages).
Twitter-users seeking information on Portland can add #inpdx to their questions. Tweets tagged with this code (also called a "hash tag") are sought out by Twisitor Center staff members who then send back suggestions. But the beauty of Twitter is that other users who aren't affiliated with Travel Portland can also chime in with additional tips. So, if a traveller tweets "Need a good BBQ place in Portland #inpdx", she could end up with suggestions from not only the Twisitor Center but also from anyone else - Portland residents, foodies, fellow travellers - in the Twitter community.
Travel Portland believes that with Twitter they can be more conversational and responsive and this is how a lot of people make travel and entertainment decisions these days. Travel Portland added that Twitter lets them talk to travellers who prefer social networking and who wouldn't normally visit an official travel website.
In addition to responding to questions from visitors, Travel Portland's Twitter stream will include several proactive tweets per day, covering such pre-defined topics as dining, green travel, special deals and recreation.
Because Twitter is relatively new to many travellers, Travel Portland's website features a Twitter page that explains the service and connects to Twitter in Plain English, a fun, two-minute video that covers the basics. The page also links to Travel Portland's Twitter stream, where visitors can see what others are tweeting about and sign up to "follow" Travel Portland.
The Twisitor Center is one of several online initiatives that Travel Portland is undertaking. Another among these is GoSeePortland, a social-networking website where Portland residents and visitors share tips, ratings and reviews - as well as get customized travel recommendations. GoSeePortland launched in 2008. (Travelmole, February 2009)
Last Updated on Thursday, 02 September 2010 17:26
