The Correct Definition: Green Travel April 22, 2009
Posted by Jussi Huotari in : travel , 3 commentsNoun: green travel [green tra-vul] 1. Having fun while making the world a better place. 2. Adventures that money can’t buy. – also ecotravel, ecological travel
Green travel helps protect the nature. You travel to the Great Barrier Reef to experience the clean waters, colorful corals, and a myriad of different fishes. The locals make their living out of the reef and it is in their best interest to maintain the reef vivid and lively to keep travelers coming back and telling their friends about the amazing underwater sceneries.
The above example applies to a variety of places. An ecotraveler goes to places, where nature is not a resource but a value as such. In doing so, she enables the locals to make their living out of the environment in sustainable way. Another example: instead of killing whales for food and products, Iceland is now famous for its unique whale-watching trips. Protecting the endangered species is now encouraged by money: if the whales disappear, many people working in the tourism industry would lose their living. This is market economy working for the environment!
My advice: Have fun and go see the world! Your travel budget will help making the world a better place. It’s all about the attitude. Honestly, who still thinks it’s better to buy experiences with money while nature can provide adventures that money can’t buy?
Happy Earth Day everybody! 
Greenwashing Aeroplanes? April 7, 2009
Posted by Jussi Huotari in : travel , add a commentI travel somewhat often and mostly by plane. And I’ve been worried about the ecological impact of flying. Thus I was happy to find out about a list by Finnair (the biggest finnish airline). Finnair claim that carbon emissions can be cut by up to 30% by following these three simple rules:
- Choose modern airplanes. Travel with an airline, whose fleet consists of modern fuel-conservative aircraft.
- Choose direct routes. Avoid stopovers. Less time on air means less consumed fuel.
- Avoid big and busy airports that get crowded during the rush hours.
Sounds so good that we posted the list on TripSay as well.
Or is this just greenwashing? I find it very difficult to believe that the impact could be as much as 30%. At least it would be better to talk about the average impact instead of the peak…
According to PhoCusWright I’m not alone if I’m sceptical. A bit over a half of travelers suspect green washing when travel companies try to communicate their green strategy and ecologicality.
PhoCusWright’s survey of U.S. travelers finds that 56% are skeptical of what companies are telling them about green practices and only 8% think it is easy to find green travel options. Travel companies must clearly communicate the precise value and impact of their green strategies.
Reducing towel laundry and linen use is not enough anymore. Cutting one third of flight emissions could be. I think Finnair is on the right track in taking “green” into account in their marketing. That is, if they can prove the numbers…
Battle of the Online Travel Giants April 1, 2009
Posted by Jussi Huotari in : business, travel, web2 , add a commentI thought these things happen only in books. What we have here is a battle between two very interesting travel businesses! I’ve read many business strategy books about how companies innovate to beat their competition and update their strategy according to market changes and apply game theory to best utilize their competencies and so on. But how does it look like in reality?
The Players:
- TripAdvisor, a hotel review site with the most User Generated Content. TA is owned by Expedia Inc., an OTA that has the biggest market share in the States.
- TravelPost, a hotel review site that has been idle for a couple of years. Kayak.com got their hands on TP when they accuired Sidestep in early 2008. Kayak.com is a relatively new flight meta search engine that has gained a lot of traffic and has become one of the most popular travel websites.
Ric Garrido writes about the amounts of UGC that TA and TP have, see his blog post.
Playfield: the online travel market. Travel is huge online market with internet sales in Europe and USA adding up to $160bn. The online travel is growing quickly in both USA and Europe. Expect a double digit growth rate for year 2009 in Europe [Marcussen 2009]! Thus we have a lucrative market but the margins are falling. Commissions from airlines are very small and the common “truth” is that hotel bookings are the only way to make money in online travel…
Round 1: TripAdvisor launched a flight meta search on Feb 27th. In the past TA has focused on hotel bookings but now they are going after Kayak’s domain. TripAdvisor announced that their new service “Brings Needed Clarity to Airline Pricing and Provides Most Flight Options and Best Deals Available Online“. They go further:
(TA’s) Dynamic Fees Estimator, the first and only online product to help travelers understand the true cost of a flight in a single display.
TripAdvisor now provides more flight choices than any other online flight search engine for the world’s top airlines.
Round 2: On March 11, TripAdvisor’s parent company Expedia announces that they’ll “waive booking fees on all flights”. Expedia is attacking Kayak’s position as the best place to look for flights. Is this linked with TripAdvisor’s announcement? Kevin May offers some insight, see here…
Round 3: Kayak strikes back. On March 24 they announce a launch of “World’s Largest Hotel Information Site“, i.e. TravelPost.com. TravelPost supposedly aggregates reviews and ratings from a huge number of sources and provides all these without pop-ups or clutter. And further:
For the first time, consumers can visit one website for all the information needed to make an informed decision on their hotel booking.
“Consumers and hoteliers are woefully underserved by websites like TripAdvisor.com, who appear to care more about their bottom lines than providing relevant content and a seamless experience,” said Steve Hafner, CEO and co-founder, Kayak.com.
What’s up next? Can’t wait to see Round 4!
Sam Shank (TravelPost founder and ex-CEO) posted an interesting analysis on the strengths and vulnerabilities of TA and Kayak.
Travel Trend: City Breaks Down, Southern Hemisphere Up March 11, 2009
Posted by Jussi Huotari in : business, travel , add a comment
Opodo(*) made a study of their bookings of January 2009. Comparing with the same period last year, it’s apparent that short city breaks in the eurozone are not this year’s things. The trend is that people are traveling to the southern hemisphere and that people are taking one longer holiday instead of a few short breaks.
Sounds like people want to make the most use of their tight budget by visiting destinations that provide good exchange rates for Euro and English pound. While the European hotspots, such as Paris and Florence, experience a fall in interest, long haul destinations have seen higher bookings.
The top-3 destinations with the biggest growth (source Opodo):
- Melbourne, Australia (up 400%)
- Singapore (up 219%)
- Delhi, India (up 165%)
(*) Opodo is an European online travel agency founded in 2001. The company is owned by a consortium of European airlines and Amadeus. Opodo operates sites in e.g. Germany, UK, France, Spain, etc. They plan to continue double digit growth in 2009.
Flight Canceled? A Curious Conversation Regarding Compensation March 10, 2009
Posted by Jussi Huotari in : business, travel , add a comment
Do you think that an airline would have a customer service staff reachable over phone? I did. But now I know better.
I had the most curious conversation with a Lufthansa representative at their ticket desk at the Frankfurt Airport about a canceled flight:
Me: My flight from Seattle was canceled. I’d like to request refund of my accommodation and ground transport.
Lufthansa: Ah, hmm, ok. They should have offered you refunding and compensation at Seattle airport then.
Me: Well, they didn’t do that in Seattle but instead told me to come here.
Lufthansa: There’s nothing I can do for you. You must contact our customer service. Here’s their mailing address and fax number.
Me: Ok, thanks. Is there a number I could call and ask about the details and required attachments?
Lufthansa: No, they only have the fax number.
Me: There’s no customer service number?
Lufthansa: No. Only fax.
Me: The Lufthansa airline have no customer service number?
Lufthansa: That’s right. No number.
Me: Ah, ok. Thank you very much for your help.
What the heck? I thought only lean and mean startups operate without a customer service phone number and even they have very responsive email channel. Even the cheap flight search engines have a phone service during business hours. And Lufthansa is not even one of the low-cost carriers that have $1 fee for using the inflight toilet…
Based on the EU regulation 216/2004, I am entitled to a compensation and refund. The regulation is somewhat similar to Rule 240 in the U.S. I filed a claim to the provided fax number (+49-180-583-8005). Let’s see if and when I’ll get a reply. And which communication channel they will be using for the reply. On my part I included my phone number and email address in the claim…
Update: Christopher Elliott writes about a similar case with Virgin Atlantic. I’m counting on Lufthansa to take a different stance.
Hotels.com Is Broken February 12, 2009
Posted by Jussi Huotari in : business, travel , add a comment
Hotels.com is having some serious hiccups in its booking confirmation mailer. I booked a hotel using Hotels.com and they billed me alright but failed to send the confimation mail. I had to call to their service desk where they told me that “We’ve been having a lot of problems with getting these confirmations mailed.”
The confirmation was emailed to me manually, so all is well. However, the next hotel booking I made using Booking.com…
An interesting sidenote: I actually considered booking my next accommodation through Hotels.com as well, despite the extra trouble, because their site is so well localized. They have lots of information in finnish and offer a local service number. Such is the power of localization…
Hotels.com is owned by Expedia. Booking.com is owned by Priceline. Hotelclub.com is owned by Orbitz. Is the only “independent” hotel booking site the german HRS?
The Paradox of Choice February 6, 2009
Posted by Jussi Huotari in : travel , add a comment
How much time did you spend in choosing your flights last time? Going through various options and different flight plans takes a lot of time nowadays. There are so many websites to check and so many different routes for getting from A to B that choosing the best one takes ages. And how to define “the best” in this context? Is it measured by $ or by time or by aircraft’s comfortability or …
Following a friend’s recommendation I read a book by Barry Schwartz called “The Paradox of Choise: Why More Is Less“. In the book Schwartz argues that abundance of choice is actually a bad thing:
We assume that more choice means better options and greater satisfaction. But beware of choice overload: it can make you question the decisions you make before you even make them, it can set you up for unrealistically high expectations, and it can make you blame yourself for any and all failures.
Barry Schwartz divides people in maximizers and satisficers. Maximizer seek and accept only the best. Satisficers settle for good enough and do not worry about the possibility that there might be something better. If you’re a maximizer, choosing a flight is both time consuming and stressful.
I think some travel services actually target maximizers. Yapta tracks flight prices and alerts you when prices drop. Farecast predicts flight and hotel prices so that you know when to buy. And of course there are a huge number of aggregators who search multiple airline and travel sites for the absolutely lowest price.
Technology can help maximizers but, according to Schwarz, the only real solution is to train yourself to be a satisficer. You’ll have choose when to choose: “Where to travel for holiday?” is much more important than finding the cheapest flight. Thus focus on finding a great destinaion! And you’ll have to think about the opportunity cost of spending time hunting for the best when good enough is already found.
The book is a nice read. Barry Schwartz presents a few thought provoking examples but I’d say the tale could have been told using half the pages he does.
US Travel Website Ranking January 14, 2009
Posted by Jussi Huotari in : business, travel , 1 comment so farHitwise published a report of travel website rankings in the U.S (pdf, 216kB). According to the report, the Top-20 sites get almost 50% of all visits to travel sites. And Top-100 sites get about two thirds of visits. Winner takes it all, eh?
Absolute visitor numbers are not estimated in the report, only relative values. Let’s see. TripAdvisor seems to have 0.89% market share. Other sources report that TripAdvisor gets about 25M monthly unique visitors. The size of online travel is huge.
In Hitwise’s categorization, map services are by far the most popular travel websites. Together MapQuest and GoogleMaps have a market share that is almost equal to the combined total of the rest of the Top-20. The Top-20 consists of map services, OTAs and airlines. An interesting tidbit is that TripAdvisor is the only social media / UGC site present on the list.
Based on visitor numbers, the biggest OTAs are:
- Expedia (3.02% market share)
- Travelocity (1.99%)
- Orbitz (1.60%)
- Priceline (1.53%)
- CheapTickets (1.05%)
It would be interesting to see a similar report about top travel websites in Europe…
Travel Trends for 2009 January 1, 2009
Posted by Jussi Huotari in : travel , 2 commentsI’ve read a number of forecasts for year 2009 regarding travel industry. Various experts have tried to analyze what’s going to happen next year and what will be the main trends. The credit crunch and economic downturn play a major part in every report – of course – but there are many theories about the consequences of the downturn. Do the tough times require faster progress in technology? Are the big players just going to cut back all R&D costs and settle for what’s been working before? Who are the winners: agile, innovative newcomers with small cash buffers or the established GDS giants?
I’ll summarize the main points from the forecast reports. The points reflect the travel industry perspective.
Consolidation. Year 2009 will see more mergers and acquisitions in the travel industry. Consolidation will occur in both established companies merging horizontally and the big boys shopping for Travel 2.0 startups. We’ve already seen airline mergers (e.g. Alitalia case) and there’s more to come (BA and Iberia?; Lufthansa and Austrian?; etc.). It’s not only airlines merging but also smaller OTAs who haven’t really found their competitive niche as independent businesses. Some startups, on the other hand, face difficulties in raising more venture capital and we’ll see more tradesales in the TripAdvisor / Expedia style. Good for us, TripSay.com is doing well in terms of financial runway.
Marketing. Online marketing will grow along with the overall transition from high street physical stores to the online world (at least in Europe). The transition is happening because of the need to be more efficient and cut costs. However, the activities done online will change: there won’t be many experiments – “hey, let’s try this social media” brand campaigns – but less experimentation and more measuring. There’s huge potential in driving the conversion rates up and analysing web site visitors and understanding the online purchasing process. As more business is done online, the marketplace becomes crowded and some costs, e.g. CPC, will raise. Thus conversion rates become critical in order to keep CPA as good as possible.
Price-consciousness. Holiday travelers will become more price-conscious. If people previously looked for the best price on three sites, they’ll check six sites now. Differentiating and clever use of user generated content (UGC) will pay back. People will seek quality at a good price and want to avoid surprise costs – this offers a good chance for all-inclusive holiday travel packets. People are also looking for viable alternative destinations instead of the traditional favorites. E.g. in Europe you’d fly to the Mediterranian instead of South-East Asia to get some sun and beach life.
Technology. The search for better conversion rates and differentiation requires utilizing new technology in product packaging, UGC, personalization and communication channels. Transportation (i.e. flights) and accommodation (i.e. hotels) have become a commodity. Branded, dynamic real-time packaging will be a way for travel agents to differentiate and offer unique service. Personalization will be critical in order to drive up the conversion rates. Look to book ratio will decrease, i.e. people will browse more sites and read more reviews before making the actual purchase. Imaginative use of UGC helps because people trust objective UGC more than advertising (78% vs 14% / Universal McCann)
The main sources for this summary have been Travolution’s article Predictions for 2009, VentureBeat’s Another negative prediction for online ad spending in 2009, EuroMonitor’s Global Trends 2008 Overview, and a number of other articles and discussions.
Happy New Year 2009!
The Best Travel Agent? August 20, 2008
Posted by Jussi Huotari in : travel, web2 , add a comment
What sights should I see in Barcelona, Spain? Which trails would be suitable for my type of hiker in the Rocky Mountain National Park, Colorado? TripSay answers to these questions by providing recommendations and tips from friends. The idea is simple: instead of browsing through a number of websites and guidebooks, just get the travel tips from my friends. The value of a personal recommendation can hardly be overemphasized. Think about it: I’m going to the Rockies and talk about the upcoming trip with my friends. One of them tells me about the Bear Lake hike and the clear waters and especially about the elk she happened to see across the lake just when she was sitting down for a break on a fallen log…
A vivid, colorful story told by a trusted person overrides any guidebook author’s opinions or random people’s suggestions. This is true for any purchases or selections a person makes – and thus underlines the success of word of mouth marketing.
Now, a related interesting statistics from the world of social media and web 2.0 is the number of friends a person typically has and how a “friend” is defined. According to some research, the average number of friends a person has in Facebook is 164. The median is a bit less but still: social media empowers people to connect with friends in large numbers. A traveler network with many friends raises the probability that one or more of the guys in my network have been to the place I’m going to. This is actually working in practice: with already tens of friends in my traveler network, I’m having most of Europe and some USA covered quite well!
It helps a lot in planning a trip, if a person I know is recommending some of the places along my route. Thus, a good candidate for TripSay’s slogan: “Your friends are the best travel agent.”