Articles by Martin Kelly

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Dead Cat BounceSO many people trying to talk up the travel industry at the moment but three "Sales" emails in three days from Accor Hotels Asia Pacific, Oaks Hotels & Resorts, and Mantra Hotels, Resorts and Apartments suggests that the recovery, if it's on, is patchy. No question some markets are doing well – Sydney had a huge events-driven February – but others remain soft or under threat; eg Melbourne hotel market is facing dramatic oversupply.

Conflicting signals also in travel retail. Flight Centre half year profit up 96% off low base, Jetset Travelworld down 68%. Meanwhile, online retailers like Wotif.com booming, wholesaler Cox and Kings optimistic, others not so sure. Rebound or dead cat bounce? Yes and no. Hard to not think that some of those on the floor may never get back up.

Mondial Assistance Group is the global leader in travel insurance and emergency medical assistance, with 10,000 employees operating Logo - Mondial Assistancein 28 countries. The Group’s global reach means we assist someone, somewhere in the world every two seconds.

In Australia, Mondial Assistance with 500 employees, ranks third highest in the Group in terms of turnover. In 2009, turnover was more than A$280million.

Our global group has invested tens of millions of dollars in people and technology in the last few years to develop a world-first ecommerce platform that has allowed us to offer un-paralleled ecommerce innovation and value to our partners worldwide.

Mondial Assistance Australia continues to lead innovation in the Australian market with recent speciality insurance products for accommodation and event/ticket cancellation.

Our current Australian partners include major airlines, offline and online travel providers, insurers and leading financial institutions.

Mondial Assistance Group is a member of the Allianz Group through AGF and RAS International, each holding a 50% capital stake.

For more information, visit www.mondial-assistance.com.au

Logo - Flight Centre LimitedThe massive Flight Centre paid search account – which covers several sites and worth in excess of $10m a year – is up for grabs with a decision expected over the next couple of weeks. Several agencies are fighting it out, including the incumbent, e-Channel.  Flight Centre is renowned as an aggressive marketer no matter what the platform and is reputedly currently bidding on more than 200,000 key words.

Main site Flightcentre.com.au has been consistently ranked in the top two travel agencies for a number of years by Experian Hitwise due to its strong brand and heavy paid search spend, which is probably only second to the airlines – Qantas, Jetstar and Virgin Blue – and maybe some accommodation sites such as Wotif.com.  Flight Centre’s other sites, Escape Travel and Student Flights, also rank well. Meanwhile, Sydney company Switched On Media has won Flight Centre’s SEO business and reports good early results.

No Vacancy 2009 - small Annelie Child from InterContinental Sydney asks questionJust over a week to go until No Vacancy 2010 in Sydney on March 18 and things are starting to hot up. Bookings are good with representation from most major offline and online accommodation brands plus all leading industry groups. It should be a great day with an audience of around 200. Haven't booked yet? Don't miss out. See who's down as a delegate so far. More …

Hot topics, great speakers, big brands and excellent networking: No Vacancy 2010 has got it all in just one action-packed day in Sydney on Thursday, March 18, 2010.

Highlights include interviews with ‘Hotelier of the Year’ Simon McGrath from Accor, Robbie Cooke, CEO of Wotif.com, and Jerry Schwartz, Australia’s largest private hotel owner.

The spotlight is also thrown on less celebrated industry sectors such as remote accommodation and ‘Holiday Parks’ and there’s a focus on distribution, marketing, revenue management and online strategies.

Key themes are Distribution, Innovation and Inspiration while the program is packed with industry-leading speakers such as:

  • Yvonne Bristow, Chief Operating Officer, FreeSpirit Holiday Parks
  • Robbie Cooke, CEO, Wotif.com
  • Bernadette Dennis, Managing Director, HSMAI Asia Pacific
  • Dean Dransfield, Managing Director, Dransfield Hotels and Resorts
  • Sebastian Fontanarossa, Marketing Strategist
  • Mike Ford, Managing Director, SiteMinder
  • Grant Hunt, Chief Executive Officer, Anthology – The Traveller’s Collection
  • Alan Long, Research Director, Hitwise
  • Luke Jamieson, GM Distribution, Mantra Group
  • Chloe Lim, Managing Director, HotelClub
  • Simon McGrath, Vice President Australia, Accor Hospitality
  • David Oliver, Chief Executive Officer, Roamfree
  • David Perry, Chief Executive Officer, The Windsor Hotel
  • Prashanth Radhakrishnan, Area Director of Revenue Management, Starwood
  • Dr Jerry Schwartz, Chief Executive Officer, Schwartz Family Company
  • Yury Shar, Managing Director, Hotels Combined
  • Kirsty Shaw, General Manager, Stayz.com.au
  • James Shearer, General Manager Operations, Big4 Holiday Parks
  • Paul Southey, Vice President Asia Pacific, TravelCLICK
  • Peter Topping, Social Media Strategist
  • Liz Ward, Chief Executive Officer, Australian Tourism Data Warehouse

Bookings are strong and 200 delegates are expected. Tickets cost $549 + gst.

Please visit www.traveltrends.biz for further details.

Contact: Martin Kelly (02) 9882-1575

Google is doing everything in its power to push people into Google Maps, one of Australia's smartest travel search marketers told me last week. Hard to argue. See response to 'Sydney Accommodation' below.

Google - Sydney accommodation screen grab smaller

Everything above the fold either sponsored listings or maps (I had to crop right side sponsored column due to space). Not a single organic text listing to be seen. Good news for savvy suppliers, bad news for Online Travel Agents, which dominate text listings for this popular search term but have no relevance for Maps and so don't appear above the fold. So now OTAs must bid and buy top spot, enabling Google to make more money from the page. Of course further revenue could be generated by charging for Google Maps listings. Something that hasn't happened. Yet.

This is weird – counter-trends. After years of booking lead times contracting in our "just in time" world, the Wotif.com results for the last six months of 2009 reveal that the number of days between reservation and check-in blew out by almost 100% over the corresponding period in 2008 …. 13.35 days compared with 7.93 days.

Why? Perhaps it's because people, stung by the new financial and social reality created by the GFC, are becoming more considered in their decision-making. Or maybe the deals were so good, and time-sensitive, they couldn't wait. Time will tell. (Update March 1: Or it could be something as simple as Wotif extending its booking window – see comments…)

Also had a laugh at yesterday's news from Qantas it is increasing flights between Australia and Japan after years of cut backs. The reason is increased Australian leisure visitors to the Land of the Rising Sun, tourism payback after all the business Japanese visitors have given Australia over the years. Who knows, one day they may even return in large numbers. After all, a trend is only a trend until it ends (when it becomes a new trend)…

gavelGOOGLE, and social media for that matter, is under legislative attack in Europe. The contentious conviction by an Italian court today of three Google execs for allowing the download of a video in which an autistic boy is bullied came just a day or two after news broke that the European Commission has started an anti-trust (abuse of power) investigation. That’s not all. According to Electronista.com, the company is also the target of an anti-trust action initiated by Italian newspaper publishers who say Google unfairly keeps them from making money from online advertising; Germany has a similar case ongoing, while a government-commissioned panel in France recently began a related inquiry. You get the feeling there's a lot more to come. See Google's response to the Italian ruling here.

Traditional wholesaling finally moves online but not in the way we may have thought. That’s one interpretation of the launch by Orbitz Worldwide of logo - orbitz for agentsa travel agency portal offering commissions of 10% on accommodation bookings and 4% on packages, rates that are much better than its existing affiliate program for online partners. It’s a move that makes a lot of sense, opening another distribution channel for Orbitz (which has 80,000 hotels on its books) while giving agents access to new product, some which would not be available through the GDS. What’s most interesting, I think, is the way it changes the relationship between online and traditional travel agents, many of whom resent their web rivals. There would certainly be some irony if this succeeds. www.orbitzforagents.com

All marketers are liarsI love marketing and I love words but when the two collide the end result is often a verbal car crash with language the innocent victim. Marketers take a word, apply it to a product and manipulate it until the original meaning has been lost.

Travel marketers in particular have a lot to answer for with two words - luxury and premium.

Luxury has been abused for years while Premium is now on the slippery slope. Great example is Qantas Premium Economy, a pure marketing creation, merging two conflicting words to create a new product and revenue stream.

Brilliant marketing concept but the end of Premium as we know it (and First Class, for that matter)…

Robbie Cooke, Wotif.com

Robbie Cooke, Wotif.com

Online accommodation giant Wotif.com has launched a new flight site, Wotflight.com.

It's domestic only offering Qantas, Virgin Blue, Jetstar,  Rex, Brindabella, Air North, Aeropelican and Skywest services. Low Cost Carrier Tiger Airways has been excluded.

Wotflight.com is entering the market with a $A16.95 online booking fee, A$26.95 over the phone. Every booking will receive a $10 Wotif.com voucher.

Meanwhile, Wotif.com CEO Robbie Cooke today announced a record half year profit of A$27.6m with all key metrics on the up. Its shares surged more the 5% on the combined news.

A detailed analysis will be posted in the next day or so.

Drew Patterson, Jetsetter, small

Drew Patterson, Jetsetter.com

ARE ‘Private Sale’ sites – where luxury accommodation is beautifully packaged and sold at a heavy discount to a members-only database in ‘flash sales’ – the next big thing in online travel? Yes, if you believe the hype; no if scale is all you care about; probably not if you’re a fiscal realist.

After all, the Private Sale sites have only just begun and their turnover is drop in the ocean compared with the industry giants. But this nascent online travel sector led by Jetsetter.com, Rue La La and now Kayak demands attention because they challenge the traditional OTA model, which hasn’t changed for a decade or more.

Pioneered and perfected by the likes of Expedia, Travelocity, Priceline, Orbitz, Hotels.com etc, Jetsetter.com founder Drew Patterson says traditional OTAs are good at processing travel transactions but suffer from  the “paradox of choice”. More …

This is one for all you pricing purists – a true story where the names have been changed to protect the guilty… There are two publications fighting it out for the hearts and minds of the travel industry. One is clearly the market leader, packed with advertising every day, while the other is a long way number two with 75% less advertising. The market has clearly stated that it only sees value in the market leader under the present rate structure yet there's been no adjustment from #2 even even though the imbalance is getting worse.

A potential advertiser recently approached #2 with a low-ball, long-term offer for a slot that had seen nothing but house ads for weeks figuring something is better than nothing. He was told: "The rates for positions are not determined by whether they've been sold or not but the value that those positions have." Right. Genius at work. Slot still vacant. And people say discounting is a bad thing. Discuss.

Chloe Lim

Chloe Lim - "other opportunities"

BIG changes at Orbitz Worldwide subsidiary HotelClub where long-term boss Chloe Lim "is leaving to pursue other opportunities" and has been replaced by American Jeremy Bellinghausen, who joins from Business.com, where he was general manager and vice president of advertiser products. The news came as a shock to the local industry with no indication Lim would be leaving her role as Managing Director.

In an announcement, Orbitz CEO Barney Harford said "Jeremy brings extensive leadership and product management experience to HotelClub" and thanked Lim for her service to the company, were she has worked in various roles for many years. An Orbitz spokesman said: "We intend to focus on Asia Pac as a key region with greater significance in the years to come, which will largely be served by HotelClub and our Orbitz Worldwide hotel sourcing team." Bellinghausen started work in Sydney today and Lim will assist with the transition over the next few weeks.

A survey of US travellers reveals that despite heavily embracing social media they are generally not using Facebook for travel planning purposes. Just 10% of those surveyed by Travel Horizons used Facebook to get information on destinations or suppliers. Much more popular was uploading photographs and rating products and services.

TripAdvisor has peaked. Big statement but I can’t shake it. The world’s largest travel “community” – 11 million members, 30 million reviews – may continue to grow but its reputation among frequent travelers and the industry is in terminal decline. This is crucial. It means the people who matter will move on, leaving it to the ignorant and the socially needy. No doubt it will remain a fantastic business, but one without soul or genuine credibility, absolutely crucial criteria for any media business, old or new.
These thoughts have bubbled to the surface following the brouhaha that’s erupted in the UK over the latest top 10 dirtiest hotels list. Negativity has long been TripAdvisor’s stock PR tactic, generating masses of stories and links. The resulting industry shrieks of outrage are no surprise – they happen every time – but the general media is no longer simply swallowing and regurgitating the TripAdvisor press releases. Powerful old players like the Daily Mail newspaper are questioning the results and also the quality of reviews. European hoteliers are calling for legislation to govern review authenticity.
The outrage is focused on the fact anyone can post a TripAdvisor review whether or not they have stayed at the hotel in question. Cleary, a rival property could post a negative review. Or the property owner’s second cousin by marriage could write a glowing five-star post. Well, yeah. Sure, the industry has complained about this central weakness for years but it’s significant that it is now mainstream knowledge, as is an increasing realization that TripAdvisor’s ragtag community is fallible. The Wisdom of Crowds has been debunked.
The key question is – what does the TripAdvisor community represent? This is a question no-one has yet been able or willing to answer. Certainly many TripAdvisor members appear to be ignorant, poorly travelled and without any sense of context. A lot are also angry and small-minded. As Rod Cuthbert from Viator has pointed out, reviews are often dominated by American travelers, whose view of the world and hospitality does not translate well to other cultures. Then there are the fakers, those posting false reviews and opinions (who TripAdvisor attempts to thwart with a secretive fraud squad and mysterious algorithm).
Of course, there are also plenty of TripAdvisor members whose views are educated and considered but these tend to get lost in the mix, like finding a needle in the haystack. It can be a hugely time-consuming exercise trying to locate a review that actually means something, making TripAdvisor’s claim to be the “world’s most trusted source of travel advice” look like false advertising. However you’ve got to give them kudos for coming up with a tagline magnificent for its ambiguity. It can’t be proved or disproved … it simply is.
So, if you accept that the tide has turned and TripAdvisor needs to bolster the integrity of its reviews, what can it do? The most obvious step would be to allow only qualified reviews, but there are several problems with this 1) since TripAdvisor does not take bookings how can it determine authenticity, 2) it would stem the flow of reviews integral to TripAdvisor’s volume-based business model, and 3) it may be seen as an admission that fraud is part of the current review culture.
Given these hurdles, do not expect change any time soon. TripAdvisor will remain immensely powerful for a long time to come. But now it’s become a big bloated slow-moving corporate creature – and history shows the Internet is best suited to the nimble and the quick. There’s no threat on the horizon, just yet, but surely it will come.

TripAdvisor has peaked. Big statement but I can’t shake it. The world’s largest travel “community” – 11 million members, 30 million reviews – may continue to grow but its reputation among frequent travelers and the industry is in terminal decline.

This is crucial. It means the people who matter will move on, leaving it to the ignorant and the socially needy. No doubt it will remain a fantastic business, but one without soul or genuine credibility, absolutely crucial criteria for any media business, old or new.

These thoughts have bubbled to the surface following the brouhaha that’s erupted in the UK over the latest top 10 dirtiest hotels list. Negativity has long been TripAdvisor’s stock PR tactic, generating masses of stories and links. The resulting industry shrieks of outrage are no surprise – they happen every time – but the general media is no longer simply swallowing and regurgitating the TripAdvisor press releases. Powerful old players like the Daily Mail newspaper are questioning the results and also the quality of reviews. European hoteliers are calling for legislation to govern review authenticity. More …

Gay mardi GrasThe cost of being gay used to be social now it's financial. But in a nice kind of way. Virgin Blue is running a special Gay and Lesbian Mardi Gras flight between Melbourne and Sydney on February 25 on which a one-way ticket  costs A$199 including "refreshments, goodie bags and 'very special' entertainment from 'Leave It To Diva'."

They better be good because DJ857 passengers will be paying A$104 more than those on other Virgin flights leaving around the same time (on today's prices). You could buy a lot of, um, other Mardis Gras stuff for that kind of dosh but the flight's sure to be fun. PS: How bad is this Virgin Blue PR headline: 'Up Up and A Gay – We're Boeing to Mardi Gras'. It's for real.

Japan Inbound Tourism Numbers Crash

Rising SunThink you've got it bad. Spare a thought for Japanese tourism operators. Visitor arrivals to the Land of the Rising Sun fell 18.7% during 2009 due mainly to huge declines in the number of Korean and Taiwanese tourists, according to the Japan National Tourism Organisation.

However, there are signs of an inbound rebound with December arrivals up 22% over the previous year. Outbound Japanese tourism fell for the third consecutive year, this time by a relatively modest -3.4%.

backpackerAMID the concern surrounding Australian domestic and inbound tourism has emerged an interesting and overlooked fact. Latest stats from Tourism Research Australia show the number of international travellers under the age of 30 (backpackers) is growing and now represent 32% of all visitors to Australia, up from 29% in 2007 to 1.6m last year. Most are coming from New Zealand (14%), the United Kingdom (11%) Japan (10%), the USA and China (both 7%). Korea, Germany, Singapore, Malaysia, India and France are also well represented, while their average spend was A$5736. So why haven't we heard more about them? Perhaps if present growth trends continue, we will.

Kayak Lost In Oz

Funny story … search on Kayak.com for a one-way flight from Sydney to Los Angeles on September 22, 2010, and you'll find a fare from Oceanic Airlines, the fictional airline made famous by TV sci-fi drama 'Lost'. Try to buy a ticket you'll be redirected to the page on the Lost fan website for Oceanic Flight 815 which crash landed on a weird uncharted island on September 22, 2004, providing the opening to what is a very strange but successful series. Full story at CNET.

Lost screen shot

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