Last week, over 200 online marketers met in the Emerald City of Seattle for the first ever SES Travel Edition Conference. On top of the online travel industry growing at a rate of 20 to 22 percent year-over-year, travel meta search is growing even faster than the rest of the industry, and is eroding market share from the OTAs (online travel agents) such as Expedia Orbitz, and Travelocity, among others.
Accordingly, direct bookings (airlines, hotels, cruises, car rentals, etc.) are increasing and account for almost 60 percent of all online travel bookings, thanks to the increase in referrals directly from travel search engines. On top of that, we also know that three-quarters of all travelers are online during the research and planning process, and over 50 percent of all travel bookings occur online.
Given this set of circumstances, one of the most anticipated sessions of the entire event was "Meet the Travel Search Engines." The audience had a chance to meet the providers, and the representatives highlighted their unique search products while agreeing on overall growth in the travel search space.
Most critical for any travel supplier to gain traction and effectively leverage travel search tools, is the ability to take advantage of the travel research funnel of Inspiration > Research/Planning > Comparison Shopping > Book and Travel. Providing entry points at each of these stages is key for any travel supplier or search service. Attempting to fill the gap for online consumers, as they become more educated users, appears to be the theme among travel search suppliers, and each has taken a different approach to doing so.
Kayak and SideStep
The basic premise behind both Kayak and SideStep is to create an aggregate listing of all fares and prices available, providing referrals directly to the travel supplier, noting that consumers often prefer to buy direct. By sorting and comparing the widest number of options available, these travel search tools have earned the respect of consumers by providing an unbiased comparison search.
Both SideStep and Kayak agree that travel suppliers are winners as well when advertising on travel search engines, and are enjoying high conversion rates (as high as 17 percent), controlling customer purchases and enhancing their own brand awareness. Accordingly, Kayak is the noted industry leader, backed by Hitwise and comScore data, and SideStep follows not far behind in terms of overall consumer awareness.
A Different Breed of Travel Search
FareCast and FareCompare are two services that are distinctly different from the above participants. Both are aimed at arming consumers with the airfare pricing data and information to make an informed purchase decision. While both provide real-time airfare comparisons and refer users directly to the suppliers, the real advantage to these services lies within their alert systems.
FareCast is basing its model on adding a layer of search intelligence to leverage historical data to make predictions and provide advice within the search results, directing consumers on the best time to buy. Meanwhile, FareCompare, which also leverages its historical data to provide airfare-drop alerts, is positioning itself as a consumer advocate, providing content empowering travelers to make smarter purchase decisions.
Mobissimo is one of the few travel search aggregators to take an international approach to aggregating fare and pricing data, truly positioning itself as a meta-search engine for the travel space. Mobissimo's greatest strength lies in the fact that it searches over 170 sites in real-time and includes both large and lesser-known international travel suppliers to find the most relevant information.
Take-Aways from Travel Search
As these search tools continue to erode market share from the traditional OTAs, they are also actively gaining incredibly-loyal and valuable users, since several of these travel search tools are taking advantage of user-generated content and social networking applications to differentiate themselves among competitors and retain customers. SideStep's acquisition of TravelPost, a user-generated content and review site, and TripUp, a social networking site for finding travel partners, solidifies the approach that empowered and educated users are more valuable to travel search suppliers.
That doesn't mean traditional search engines are completely forgotten when it comes to the travel planning process and user-generated content.
Travel Offerings in Traditional Search Engines
Collectively, the Yahoo! Travel group has the most differentiated approach, where the emphasis is on user-generated content and experimenting with new forms of social search, lending credibility to the experiences of other travelers for those in the research process. Among the tools for accomplishing this, Yahoo! brings several different products to the table, including travel recommendations, deals, destination guides, sharable trip planners, FareChase, and several paths to booking travel online. Meanwhile, shortcuts for popular destinations are appearing within regular search results, further blurring the lines between standardized Web search and vertical search results, which creates a user experience full of choices.
This is echoed in many travel-related searches that occur on Google Web search. While true "travel" search data isn't actually presented, relevant results are provided for tourism-related businesses, "local" matches to a destination, and any related map data. Within Google Maps, the recently added "My Maps" feature allows users to create mash-ups of sorts for their own travel plans, which can easily be made accessible to others searching Google. This has led to over 4 million permutations of the tool, where users have plotted vacation photos, directions to hotels and other attractions, as well as their own personal guide to a given destination.
All of the above trends were underscored in the keynote presentation by Nancy Ramamurthi, Chief Marketing Officer for SideStep.com, who predicted that travel search will grow to over 100 million unique visitors in the next three to five years, and that direct supplier relationships with the travel search engines will grow stronger because the distribution opportunity offers so much reach to more-qualified and engaged travel users.