All posts by Martin Kelly

Melbourne Hotels Win Asia-Pacific E-Marketer Award

Crown Towers Hotel and Crown Promenade Hotel in Melbourne have been jointly named Asia-Pacific E-Marketer of the Year in the annual TravelCLICK and Hospitality Sales and Marketing Association International (HSMAI) awards.

The Melbourne properties scored the award, restricted to TravelCLICK customers, for significantly increasing business through electronic distribution channels.

During 2004, Crown Towers, a 482-room luxury hotel, used search engine marketing to increase its website visitors by approximately 41%.

Over the same period room nights 40%, while 2004 revenue rose 50% over the previous year.

Sister hotel, the Crown Promenade, a 465-contemporary property, targeted travel agents and became one of the top 15 hotels in Melbourne, based on revenue booked through the GDS, within one year of opening. 

Hyatt International was selected as the Overall E-Marketer of the Year winner based on its strong performance in electronic channels and effective use of both targeted electronic media and competitive knowledge.

Other E-Marketer Award winners are:

  • North America E-Marketer of the Year – Kimpton Hotel & Restaurant Group
  • Latin America E-Marketer of the Year – Country Club Lima Hotel
  • Europe/Middle East/Africa E-Marketer of the Year – Radisson Edwardian International Plaza Hotel Heathrow
  • E-Marketer Lifetime Achievement – Tom Civitano, Executive Vice President Sales & Marketing, The Plaza Hotel, New York

TravelCLICK is a US-based company that provides electronic marketing and price benchmarking services to the hotel industry. It has more than 8000 customers across 140 countries.

Ends.

 

Search Engine Marketing Takes Off – Are You On Board?

SEARCH Engines are going gangbusters. Advertisers – travel companies prominent among them – are lining up to get on board. Just look at the first quarter results for the two biggest brands, Google and Yahoo!.

Google’s first quarter profit quadrupled to US$369.2 million. Revenue – almost entirely from online advertising – increased 93% to US$1.3 billion. The news pushed Google shares, which listed last August at US$85, beyond US$220.

Meanwhile, Yahoo!, the most popular US website, posted net income of US$205 million for the first three months of 2005, more than double its US$101 million profit for the same period last year.

Big money, massive profit growth rates, something is very real happening here. In simple terms, the Search Engines are getting mobbed by businesses large and small which want to advertise with them.

And this is just the beginning. Search Engine Marketing (SEM) – the art of highlighting websites, brands or products in response to consumer “keyword” queries – is still in the first flush of youth.

Google, which has entered the lexicon and seems to have been around forever, is just 10 years old. Yahoo! was started in a Stanford University trailer in 1994, and listed a year later.

Here in Australia, the SEM story is equally positive. Why? Because SEM is cost-effective (for now at least) and it works. In fact, Australian internet advertising in general is on the rise with SEM the current star performer.

According to a survey by emitch and Roy Morgan Research, prominent advertisers estimate that 9% of their total advertising budget (or around A$800,000) will be allocated to the internet in 2005.

These experts are increasingly shifting their spend to SEM and believe the major strengths of the internet as an advertising medium are (1) targeting capabilities; (2) customer reach; and (3) cost effectiveness.

They also saw “immediacy” and “accessibility” as major strengths.

And with travel one of the most searched for categories on the Internet, there are clearly major opportunities for travel businesses to market online, with very real benefits for those who get in early.

The buzz among travel industry early adopters is very strong. At the recent Search Engine Room conference in Sydney, around 25% of the 250 attendees came from travel, with many actively using SEM to great effect.

Importantly, it’s not just airlines, hotel and destination sites who are getting on board. Corporate travel, car hire and destination sites are all using a mix of organic and paid search to generate sales leads.

Organic search results are the links which appear on the main panel in response to a keyword searches such as “cheap airfares” or “Gold Coast hotels” – while paid search is generally the boxed listings to the side.

Most experts like to have a mix of the two to balance risk and return.

Paid search advertisements are priced – and ranked – according to demand. Researcher Frost & Sullivan estimates that the average cost of a keyword is around A$1, although prices can range from 10 cents to $50.

Organic results are much less predictable with high rankings determined by a number of factors, in particular relevance of text, number of site links and popularity.

In Australia, the clear search engine market leader is Google with around 50% of eyeballs, followed by ninemsn and Yahoo! (which also offers organic and paid search to numerous partner sites, including ninemsn, through Overture).

Combined, these sites are just about the most popular segment on the Internet, and Nielsen//NetRatings reckons search engines have a “reach” of 71% among the 13+ million Australians with Internet access.

That’s a lot of potential customers. Can they find you?

May 13, 2005

TIAS Signs More Suppliers

Avis, NSW Holidays and TravelPoint have joined Australia’s TIAS TravelTools booking database, which now features 37 suppliers.

General Manager Sales and Marketing, Gerald Chait, says the number of travel agents using the system had also increased.

“Over the past month we have seen a significant increase in activity and May was a record month for agency subscriptions,” he said.

Three new suppliers have also joined the TIAS online payment system, TIAS Tips – Captain Cook Cruises, Spacewalker Gold Coast and Infinity Gold Coast.

Chait said TIAS Tips can now be integrated into a supplier’s host booking system.

Ends.

 

Flurry of Deals For eNett

THE flurry of announcements from eNett International has continued with Tramada the latest company to announce an alliance with the Australian technology provider.

eNett has moved quickly to capitalise on the push for travel agent service fees in Australia and announced a series of distribution agreements over the past two weeks for its Travel Service Fee (TSF) product.

These include arrangements with Galielo and now Tramada, which supplies travel management software to the retail travel industry.

eNett claims TSF enables travel agents to easily move to a service fee business model from July 1 when Qantas cuts domestic airline commissions from 5% to 1%.

CEO Anthony Hynes says: “TSF is a very simple product which can be fully integrated for ‘booking-to-back-office’ processing and reconciliation, interacting seamlessly with existing agent systems.

“It can also be set up to offer batch processing or operated as a standalone desktop solution to make the process easier and more cost-effective.”

The company also markets the eNett payment and accounts management system.

Partners include Qantas Holidays, Calypso, Sunlover Holidays, The Travel Corporation, P&O Cruises, Scenic Tours, Globus & Cosmos, the AOT Group and Australian Pacific Touring. 

Also on board is MasterCard International for credit card connectivity, and ANZ Banking Group.

Ends.

Tramada Links With Amadeus

TRAVEL Management Software provider Tramada is seeking further distribution opportunities after sealing a fresh agreement with Amadeus, announced just days after its exclusive arrangement with Sabre expired on April 30.

Tramada Director David Lanning says while “it’s still business as usual with Sabre” the company is keen to further expand its distribution network and access a greater number of travel agents.

Managing Director Michael Rudny says Tramada is also talking with Cendant and hopes to have an agreement in place by the end of this year.

“I think there are great growth opportunities for Tramada, and Sabre has graciously understood that were we to remain exclusive to them we could never reach our full potential,” Rudny says.

Tramada has 1500 travel agent clients from most leading groups including Jetset, Travelscene, American Express, Harvey World Travel and Traveller’s Choice.

May 13, 2005

STB Supports Wired 2005

ASIA’S first home-grown travel distribution and technology conference – Wired 2005: Asia Travel Matrix – was launched today with a three-year marketing commitment from the Singapore Tourism Board. 

Wired 2005 will bring together all major Asian industry players in travel’s most dynamic sector, reflecting the increasing maturity of the local travel technology and distribution market.

Based on three basic pillars – Bold Thinking, Fresh Ideas, New Technology – Wired 2005 has already won strong industry support.

Apart from the STB, other foundation partners include Akamai, Yahoo! Asia, Millenium and Copthorne Hotels, Pegasus and HEDNA.

To be held at the Grand Copthorne Waterfront Hotel on October 20-21, the event has been founded by two of the region’s leading travel communication specialists – Yeoh Siew Hoon and Martin Kelly.

Stay tuned for further details.

May 13, 2005

Hungry Octopus

Australian travel agent sales have passed the A$10 million mark at OctopusTravel.com.

GM Peter Smith says while OctopusTravel.com is best known for its accommodation listings, “we’ve seen a significant increase in transfer and sightseeing bookings over the past year.”

He says that the local Octopus sales team has been boosted to drive continued growth. Octopus.com now has 22 offices around the world and was recently named the UK’s fastest-growing travel company.

May 13, 2005

 

Travel Distribution Strong But Net Income Down 44% At Cendant

By Martin Kelly

EVER thought about creating a global travel content and distribution empire? The people at Cendant Corporation, based out of New York, certainly have.

And what’s more, they have done something about it. Over the past couple of years, Cendant has bought up big, with travel and real estate the major focus.

Over the past 12 months alone it has acquired Orbitz, ebookers and Gullivers Travel Associates.

Other travel brands it owns include Galileo, Avis, CheapTickets.com,  Budget, Ramada International, Howard Johnson etc.

I’m sure you get the idea; they are big – but how big?

Well, to give you an idea of scale, Cendant is capitalised at more than US$22 billion on the New York Stock Exchange, while Sabre Corporation (which apart from the GDS also owns Travelocity) is worth around US$2.5 billion.

But no-one said running a company of this size was going to be easy, as an analysis of its recent second quarter results reveals.

On the plus side, Cendant’s Travel Distribution Services division went well and is expected to continue its strong performance, driven largely by recent acquisitions and solid gains from established internet businesses, albeit from a low base.

“We expect growth to accelerate,” Cendant’s President and Chief Financial Officer, Ronald L. Nelson.

However, the Cendant accounts reveal that total net income for the company slumped 44% to US$387 million despite booming real estate and travel markets.

The reasons for this are a little hazy, although it’s safe to assume financial indigestion flowing from the challenges of integration are a significant factor.  

Meanwhile, as part a bid to focus on core activities, Cendant will sell its Marketing Services Division for US$1.83 billion and embark on a US$2 billion share buy back over the next 18 months.

See, not easy, a fact recognized by the stock market with Cendant’s share price going nowhere over the past year.

The second quarter result was undeniably patchy. It revealed steady demand for Global Distribution Services (Galileo) but issues in its Vehicle Rental and Hospitality Services divisions.

Highlights from Travel Distribution Services (excluding contributions from Orbitz, Gullivers and ebookers) include:

  • A 48% increase in revenue and 21% growth in pre-tax profit to US$143 million.
  • Organic growth of 47% in online gross bookings at Cendant’s travel agency businesses (or US$14 million increase in revenue). 
  • Strong growth and higher margins from CheapTickets.com, which has now migrated to the Orbitz technology platform. 
  • Steady result from GDS cash cow Galileo which generated 3% revenue growth – from US$396 million to US$410 million.
  • Global air traffic up 6% by GDS segment but US domestic air yields down.

Nelson claimed the recent acquisitions would really start to kick in during the second half of 2005 and through 2006.

However, analysis of the company’s overall forecasts reveal that total “income from continuing operations” will probably be down between 5% and 10% for the full year.

Once again, the strongest growth will come out of travel distribution, where Cendant is forecasting an increase in pre-tax earnings of up to 43%.

However, vehicle rental remains troublesome with decent revenue growth undermined by discounting combined with increased vehicle and depreciation costs.

“In order to offset these increased vehicle costs, we recently raised pricing at both Avis and Budget. To date, these price increases appear to have been successful,” said Nelson.

On face value, Cendant’s accommodation brands booked a solid quarter, with RevPAR increasing 10%, while revenue grew 12% to US$130 million.

Yet pre-tax profit was down 17% over the previous year due to marketing and other expenses.

Oh well, when running a global travel giant, you’ve got to be philosophical. You know, win some, lose some.

Ends.

Promiscuity Disrupts Marriage of Convenience

By Martin Kelly

AIRLINES and the GDS. Hardly a marriage made in heaven, more like a union of convenience, but one which has reaped significant benefits for both parties over many years.

Yet now one of the partners is getting restless, and it’s not the GDS. The airlines are pushing for change, throwing money at younger, sexier companies who reckon they can do it – distribute airfares to travel agents, that is – for much less.

And while most of the preliminary skirmishes have been fought overseas, the show came to Sydney last week, when Star Alliance CEO Jaan Albrecht declared: “We want to bring new players into the market.”

In a wide-ranging speech packed with Darwinian analogies – only the fittest will survive etc – Albrecht told the National Aviation Press Club that the Star Alliance is working with the new players to come up with web-based GDS alternatives.

Broadly speaking, these entrant companies offer airline inventory direct to travel agents through internet portals at a fraction of the distribution cost charged by GDS.

For example, ITA Software has claimed it will charge airlines just 50 cents per segment. Compare this with Star Alliance estimates that the average GDS charge per ticket is more than $16.

“By exploring the potential of so-called new entrants, Star Alliance member carriers will be able to break the dominance, cost structure and poor flexibility of the Amadeuses, Galileos and Sabres,” Albrecht said.

“Welcome, good old GDS, to the world of competition. It seems to be time for you, to evolve as well.”

The response of local Galileo boss, John Guscic, was equally Darwinian.

“It took an asteroid to wipe out the dinosaurs, but it will take more than gum flapping to undermine the value that the GDS brings to travel agents,” Guscic said.

Managing Director of Amadeus, Tim Russell, said there would be room for both players, something Albrecht agreed with.

“In a nutshell, we have a healthy respect for them and Amadeus is looking at how we can serve that market,” Russell said.

By “that market”, Russell said he means simple point to point travel.

His comments also highlights the inevitability of the GDS getting involved in web-based distribution alternatives, either developing their own or buying into one of the new players like G2 SwitchWorks, ITA Software and FareLogix.

All this debate follows moves in the United States, where seven of the largest carriers have signed with G2 SwitchWorks “as a provider of choice for alternative-GDS distribution services between them and key agency clients”.

Five of the carriers – American Airlines, America West Airlines, Continental Airlines, Delta Air Lines and Northwest Airlines have also agreed to pre-pay distribution fees, of up to eight million tickets, in exchange for transaction discounts and the opportunity to acquire a minority stake in G2 Switchworks.

So, as you can see, it is more than just posturing by the so-called Legacy Carriers, fired and challenged by the success of Low Cost Carriers distributing direct to consumers through the Internet.

They have clearly targeted distribution costs as a manageable expense – unlike oil prices – and are doing everything they can to bring them down.

However, come what may, you can be sure of one thing – while the boundaries within the marriage of convenience between the airlines and GDS might shift, the relationship will most certainly endure.

Better the devil you know, right?

Ends.

China’s Independent Travel Market Takes Off

By Martin Kelly

Excellent sales growth from China’s leading online retailer Ctrip once again exceeded market expectations and set a cracking pace in the world’s most exciting travel market.

Results from rival China travel retailer eLong told a different story – that of a company still establishing itself … strong sales were counter balanced by increased spending on acquisitions and marketing.

Consequently a clear split has emerged between China’s two big independent travel brands in the eyes of regional travel industry analysts.

That is, Ctrip, which is already making money, will remain dominant for the foreseeable future, while eLong focuses on building for the longer-term.

Analyst William Bao Bean from Deutsche Bank commented: "In light of eLong’s focus on customer acquisition rather than profitability, transaction metrics are the key to measuring success.

"eLong is getting traction as its relationships with portals are driving much higher traffic – but it is now up to the company to convert traffic into customers."

He said other players such as CYTS and Cendant (via their www.aoyou.com joint venture) are not yet having impact on the independent travel marketplace.

eLong’s net sales for the second quarter were RMB52 million ($US6.42 million) driven mostly by hotels, although the growth in airline ticket sales exceeded expectations.

Ultimately, though, eLong lost RMB11 million ($US1.35 million) for the quarter.

Ctrip powered on, recording net sales for the second quarter of RMB129 million ($US16 million), up 60% year on year. Net income was RMB56.5 ($US6.8 million), an 80% increase on last year’s result.

President and Chief Financial Officer of Ctrip, Neil Shen, who is leaving the company, said the results "highlighted our strength in strong organic and balanced growth.

"We have a healthy business model that we believe will continue to enable us to take full advantage of the vibrant travel industry in China."

Analyst Bean said: "Ctrip hit the ball out of the park again in the second quarter and is gradually cementing its position as a category leader in the China market based on its execution, high barriers and strong growth.

"While risks remain, including the economy and execution, we believe the outlook for Ctrip in the near and long term is good as it leads the small but fast growing independent travel market. "

Revenue at Ctrip is dominated by hotels at a ratio of around 2.5 for every airline dollar. Hotel bookings are also growing marginally quicker, although the most spectacular growth is coming from package tours, albeit from a very low base.

Online transactions are steady at 30%, compared with 20% for eLong.

Ends.

 

Search Engine Pricing Blowout For Travel And Hotel Websites

By Martin Kelly

Paid Search Engine Marketing costs in the travel sector have blown out dramatically over the past 12 months with sales conversion rates for Australian accommodation sites in particular reaching unsustainable levels.

Industry experts such as Frank Grasso from e-Channel say sales conversion rates have rocketed to almost US$90 per customer for some new players in competitive categories, while a study by researcher Frost & Sullivan confirmed it is a major concern for the industry.

“The increasing pricing problem is worse for new entrants into the market because they get hit twice: they have to pay a higher cost per click and due to their lack of brand presence they have a lower conversion rate,” says Grasso.

This is clearly making the first sale per customer uneconomic and forcing a strategic reassessment with websites justifying the high SEM cost by attempting to generate repeat business.

Grasso says the average cost per click for top position with popular terms such as ‘Sydney Hotels’, ‘Singapore Hotels’ and ‘Bangkok Hotels’ for an established company range between US$2 and US$2.95 on Google.

“A year or so ago we would have been able to get the top position for much less,” he says.

Managing Director of Amplify, Richard Noon, says: “What we are seeing is people moving more to a lifetime acquisition mode because they can’t justify paid search on a single sale basis.

“However, the jury is still out on whether this is the right approach, but clearly some players are prepared to play that game.”

Meanwhile, a report from Frost & Sullivan has revealed that rising prices and increasing competition for top ranking keywords are the top two concerns for Australian travel search engine marketers.

But Research Director, Technology, Foad Fadaghi, predicts paid search in the travel and accommodation category will still grow by at least 30% over the next 12 months.

He says the strongest growth will come from companies marketing destination activities.

Fadaghi estimates that travel is the dominant force within the Australian search engine marketing industry with 17% of total spend, closely followed by financial services on 14%.

Grasso says the rising costs are forcing many travel and accommodation companies to reassess their search marketing spend.

“The answer to this dilemma is to get smarter when devising a search engine marketing strategy,” says Grasso.

“Companies should allocate some of their budget towards PR and Branding, while using search as an acquisition tool. 

“Advertisers also need to become more aware of what the lifetime value their customers is and work out how much they are willing to pay to acquire a new customer. 

“The most successful search engine campaigns are the ones that follow a strict Cost Per Acquisition benchmark.”

Noon says the cost blowout throws the spotlight back on the importance of organic search and other marketing tools.

Both Frank Grasso and Foad Fadaghi will be speaking at TRAVELtech in Sydney on August 30. 

Ends.

 

The News Is All Good, Or All Bad – It’s A Matter Of Perspective

 

 

 

 

 

 

 

 

By Martin Kelly

OMIGOD – the world has changed. Things are different now. Those crazy kids aren’t reading newspapers, all they do is talk and text on mobiles; they’re always online and you can’t even talk to them any more.

I mean, even Rupert Murdoch reckons the internet is the way to go!

Recent reports, many of which were read online, carried the shocking news that media baron Rupert Murdoch believes newspaper editors must embrace the internet, saying print news executives “sat by and watched” as a generation of digital consumers turned away from print.

He could be talking about travel.

The omnipotent CEO of News Corp cited a recent report by the Carnegie Corp in the United States showing that 44 per cent of respondents between 18 and 34 years old said they use websites at least once a day for news.

In Australia, figures from Nielsen//NetRatings reveal that 13.2 million, or 84%, of people aged 16+ have access to the internet, 50% of users have broadband, most spend 30 minutes a day online, and that travel (like news) is one of the most popular categories with 36% “reach” among users. The vast majority of users are aged between 25 and 54.

Murdoch said that newspapers face a dire future unless the way they gather and deliver news changes dramatically. Otherwise, he said, the steady migration of readers and advertisers to web will continue unabated.

“The trends are against us,” Murdoch told the annual meeting of the American Society of Newspaper Editors. “We’ve been slow to react. We’ve sat by and watched. Unless we awaken to these changes, which are quite different than those five or six years ago, we will, as an industry, be relegated to the status of also-rans.”

So why am I telling you this? Well, replace ‘news’ with ‘traditional travel businesses’ and see what you come up with. Murdoch’s words should resonate with us all because he is simply talking about consumers wanting their product delivered in a different format more suited to the times.

Also, remember, it’s Rupert Murdoch, one of the world’s smartest businessmen, who is saying this. And, while he may be well north of 70, the so-called ‘Dirty Digger’ knows a good thing when he sees it, and it is not too proud to see the error of his ways.

The same applies Kerry Packer who, like his former compatriot, did not become insanely rich by ignoring the bleeding obvious and is set to make another large fortune with the upcoming listing of Seek, the market-leading internet job site.

Murdoch concluded that the future is strong, provided the newspaper industry – like traditional travel businesses – finds the correct balance of product delivery to satisfy a new generation of customers.

“I’m still confident of our future, both in print and via electronic delivery platforms. The data may show that young people aren’t reading newspapers as much as their predecessors, but it doesn’t show they don’t want news. In fact, they want a lot of news, just faster news of a different kind and delivered in a different way.

“And we are uniquely positioned to deliver that news. We have the experience, the brands, the resources, and the know-how to get it done. We have unique content to differentiate ourselves in a world where news is becoming increasingly commoditized. And most importantly, we have a great new partner to help us reach this new consumer — the Internet.

“The challenge, however, is to deliver that news in ways consumers want to receive it. Before we can apply our competitive advantages, we have to free our minds of our prejudices and predispositions, and start thinking like our newest consumers. In short, we have to answer this fundamental question: What do we – a bunch of digital immigrants — need to do to be relevant to the digital natives?”

Ends/ 20 April, 2005.

 

Webjet Diversifies as Sales Grow

ONLINE retailer Webjet is starting to diversify income by placing its airline booking engine – which already generates most of the company’s revenue – on three new websites within the next two months.

Managing Director David Clarke said the booking engine will soon feature on the Travelmate and Need It Now consumer sites, in addition to the Creative Holidays trade site.

The booking engine is part of the Travel Service Aggregator technology platform Webjet developed in conjunction with Galileo and Microsoft.

It can process up to 1000 transactions a minute and has been a key reason for the recent strong business performance of Webjet, which recently announced a net profit for the six months to December 31, 2004, of A$254,484.

Further profit announcements are expected with sales continuing to surge.

February, with just 28 days, was a record month with A$8.1 million in sales (11% up on January) driven by 22,000 bookings covering 30,000 passengers.

“Just wait until you see March,” Clarke said.

He added that TSA, which is able to aggregate and display product from disparate suppliers, has allowed Webjet to increase sales while controlling staffing costs.

“Most of the incremental growth goes straight to the bottom line,” he said.

“At Webjet we have 16 full-time staff,” he said. “The throughput of the best run traditional travel agencies is around $1 million a year per staff member – we can do A$6 million per person.”

Clarke said Webjet operates on a gross margin of 7% before costs – 6% is fixed while the remaining 1% goes to marketing, generally evenly split between online and offline.

“I believe you’ve got to be a visible presence in the real world – it’s no good just being a cyber space identity.”

While Clarke was reluctant to forecast because of ASX rules, he said “if the model holds true I believe our net margin can fall within the 1.5% to 2% range by the end of the year based on current trends.”

Current rampant growth rates will be difficult to maintain, he said, although the company is aiming to double existing (low-commission) airline traffic, which currently dominates income at 60%.

Another 20% comes from car, hotels, and insurance, while the remaining 20% comprises services fees.

Webjet charges a A$6.95 service fee for every transaction, no matter what volume or amount.

“It’s been in place for more than a year and we have had absolutely no resistance,” he said.

Meanwhile, whatever resistance there was to investing in Webjet has evaporated.

Over the past seven months Webjet shares have increased from three cents to a high of 22 cents (check) and are currently trading at around 16 cents.

Daily trading volumes regularly exceed one million shares, resulting in major paper profits for some of the biggest names in Australian travel.

Significant investors who bought in or struck options deals when the stock was scraping the bottom of its range include Harvey World Travel (19%), Cendant (9%) and Australian Outback Travel (3.5%), which owns Need It Now and Travelmate.

Both Cendant (GDS, hotels and car – Avis, Budget) and Australian Outback Travel (Australia and NZ hotels) are also using Webjet to distribute its products, while the HWT alliance provides it with buying power.

The frenetic stock activity has inevitably led to speculation and rumour.

But Clarke said there has been little or no recent change in the Top 20 shareholders.

“We are not sitting here trying to organise a buyout or takeover,” Mr Clarke said.

“If someone makes an offer, we’ll consider it but it’s not in the business plan or strategy.”

Ends/ 22 March, 2005

Record Traffic Levels For Aussie Travel Web Sites

CONSUMER traffic to Australian travel websites is at an all-time high, according to Nielsen//NetRatings and Hitwise.

Not surprisingly, given the launch of Jetstar, the sharpest growth has occurred within the airline sites over the past two years.

However, hotels and travel agencies are not far behind.

According to Hitwise:

  • Commercial Airlines >> Increased 69% between December 2003 and January 2005
  • Travel Agencies >> Increased 40% between December 2003 and January 2005
  • Destinations & Accommodation >> Increased 46% between December 2003 and January 2005

Meanwhile Nielsen//NetRatings reports a similar pattern.

Senior Analyst Andrew Eckford said the trend has been particularly evident during the first three months of 2005.

“Over the past few weeks we have seen consistently more than 630,000 unique browsers a week to audited travel sites.

“This is significantly higher than seen for any week since we launched the Market Intelligence measurement for the travel industry.”

Tables Below From Nielsen//NetRatings and Hitwise:

 

Nielsen//NetRatings Market Intelligence, Domestic Traffic to Travel Sites by Category for February 2005

Category              Unique Browsers      Page Impressions

Travel Portals       1,272,537                  10,659,606
Destinations         488,256                      5,065,915
Hotels                   203,342                     1,640,914
Rental Cars          133,497                     1,576,388

Hitwise – Travel – Agencies ” February 2005 ” Ranks by ‘Visits’
   
Name                           Domain                                               Market Share

1 Flight Centre             www.flightcentre.com                 11.50%
2 Webjet                      www.webjet.com.au                     6.31%
3 lastminute.com.au    www.au.lastminute.com              5.96%
4 Expedia.com             www.expedia.com                         4.47%
5 ZUJI Australia           www.zuji.com                                 3.91%
6 Best Flights              www.bestflights.com.au              3.44%
7 Travel.com.au          www.travel.com.au                        3.18%
8 Octopus Travel        www.octopustravel.com/au         2.50%
9 ITN.net                      www.itn.net                                    1.92%
10 ninemsn Travel       www.ninemsn.com.au                 1.90%

 

Hitwise – Travel – Destinations and Accommodation ” February 2005 ” Ranks by ‘Visits’
   
Name                         Domain                                              Market Share

1 Wotif.com                www.wotif.com                            6.71%
2 HotelClub.net           www.hotelclub.net                      5.70%
3 RatesToGo.com      www.ratestogo.com                   2.93%
4 Need It Now            www.needitnow.com.au            1.96%
5 TravelMate              www.travelmate.com.au            1.91%
6 Trip Advisor            www.tripadvisor.com                 1.60%
7 Totaltravel.com       www.totaltravel.com                   1.37%
8 Visit Victoria           www.visitvictoria.com.au           1.36%
9 Lonely Planet          www.lonelyplanet.com               1.35%
10 AAA Tourism        www.aaatourism.com.au           1.30%

Nielsen//NetRatings Market Intelligence, Top Destination Sites for February 2005


                                            Unique Browsers                 Page Impressions

  
1 visitvictoria.com              161,372                                  1,353,450
2 ourbrisbane.com             154,053                                  1,235,204
3 visitnsw.com.au              60,383                                    559,331
4 discovertasmania.com    48,739                                    813,611
5 westernaustralia.com     39,281                                    337,420
6 southaustralia.com          21,653                                    319,092

Ends/ 22 March, 2005

Travel.com.au Launches DP

New management at perennial under-achiever Travel.com.au Limited (TVL) has launched Dynamic Packaging on both its sites – travel.com.au and lastminute.com.au.

TVL has also ended its dual supplier approach to GDS, concluding a long-standing relationship with Sabre Pacific and fully committing to Amadeus, which has a stake in the company.

These moves come after disappointing results for the six months to December 31, a period in which TVL lost A$745,000 compared with a net profit of A$9000 for the corresponding period in 2003.

Encouraging sales growth of 9% was completely overshadowed by a 20% blowout in expenses largely due to the relaunch of the main site with a new design and booking engine.

Sales were driven solely by lastminute.com.au, which grew 35%, while Travel.com.au continued to disappoint with a 1% fall in sales. The bulk of its bookings are still handled offline.

Acting CEO Adam Johnson, who replaced incumbent Bill Gair in mid-February, said the focus at TVL – which employs 80 staff – is on growing automated sales.

He said this approach has been given strong impetus through the acquisition of Arnold Travel Technology (which Johnson used to run) via a share issue late last year.

As a result, interests associated with Arnold now control around 25% of the company. These include Johnson and new Chairman Roger Sharp.

Johnson claimed the early results from its Dynamic Packaging flight/hotel offering were encouraging, adding that automated booking numbers had increased on both sites as customers became familiar with the new booking engine.

“We’re already ahead of budget and are going to be promoting it more over the next couple of months,” he said.

Its Dynamic Packaging product is branded as ‘TripSaver’ which allows clients to “book flights and hotels together and save”.

Chairman Roger Sharp described Travel.com.au in the six month results as a company which has “traditionally operated as an offline travel agency with a website offering limited online functionality”.

It is a situation he aims to change.

Sharp said the aim now was to slow the cash burn – at December 31, TVL had reserves of A$2.5 million compared with A$4.4 million six months earlier – while growing sales.

But how? “Just having the Arnold booking engine in there means we can reduce costs, so as we grow we’ll need fewer people to handle a larger number of bookings,” said Sharp.

“The trick is to get growth in online transactions, and get it past our offline business.”

Ends/ 22 March, 2005

JTB and Viator Combine to Distribute Japanese Product

A new distribution deal between JTB Corp, Japan’s biggest travel company, and Sydney-based Viator is already yielding strong sales, according to Viator CEO Rod Cuthbert.

Cuthbert said Viator has now added JTB’s huge Japanese destination product range to its database, which is marketed through through Viator.com and 500 affiliate sites such as Hotwire, Travelocity, Zuji and Priceline.com.

Products include sightseeing and destination activities like the famous Shinansen Bullet Train tours.

“We’ve been surprised and pleased at the booking levels so far,” Cuthbert said.

“Clearly, given the perceived language challenges a destination like Japan presents, people like to get themselves organized before they go.”

Cuthbert said the initial product focus is on Tokyo, Osaka, Hiroshima and Kyoto, while the primary target market is inbound English-speaking travellers to Japan.

Cuthbert said Viator has partnered with the Sunrise Tours division of JTB.

“It’s a clear leader in English-language tours to Japan,” he said.

“There’s a bias towards educating visitors about the culture and history of Japan, and that’s exactly what our customers are looking for.”

Viator claims to be the world’s leading online aggregator and seller of destination product. Purchases are typically made by travellers prior to departure.

JTB Corp. is Japan’s largest travel company. Founded in 1912, it has offices worldwide and annual revenues in excess of US$13 billion.

More than seven million overseas travellers are expected to visit Japan during 2005, according to JTB estimates.

Ends / March 22, 2005

 

Strong Foundations For Decipher.biz

Decipher.biz – billed as the world’s largest tourism data portal – today announced it has signed three of Australia’s largest travel companies and all state tourism bodies as foundation members.

CEO Mark Phillips said Decipher, which aggregates tourism data from more than 200 sources and features a range of business planning tools, wants to further boost sales of its resources through industry resellers. 

“We’re looking for distributors and want to establish a network of resellers,” Mr Phillips said. Decipher packages start at A$550 for small companies, up to A$33,000 for large corporations.

Mr Phillips said Decipher had been buoyed by strong industry support with hotel group Best Western, hire car companies Avis and Budget signing on as foundation members.

“They view it as a valuable business planning tool – it allows them to access the latest data from around the country and build that information into their business strategies,” Mr Phillips said.

Other partners include AAA Tourism, Australian Tourism Export Council, Tourism Queensland, Tourism Tasmania, South Australia Tourism Commission, Northern Territory Tourism Commission, Australian Capital Tourism, Tourism Australia, Tourism Victoria and Tourism NSW.

He said www.decipher.biz has attracted more than 7000 unique visitors since its launch last month by the Minister for Small Business and Tourism, Fran Bailey, with the average visit lasting 20 minutes.

“I think this shows we have really hit the mark,” Mr Phillips said.

Managing Director of Decipher Technologies, Peter O’Clery, said Decipher aggregates the latest statistics from disparate sources such as the Australian Bureau of Statistics, Tourism Research Australia, State and Regional tourism organisations and private companies like Roy Morgan.

“It is designed to help tourism operators of all sizes, as well as local governments, regional tourism authorities, destination marketers and industry organisations.”

Decipher has been in development for many years and is the result of a working alliance involving the Sustainable Tourism Cooperative Research Centre, Amadeus and international consultants Ernst & Young.

Much of the funding has come from the Federal Government, which identified poor access to as a major industry issue in the late-2003 Tourism White Paper.

Decipher Technologies is administered as a business unit of the CRC for Sustainable Tourism Pty Ltd, which is responsible for developing and managing the commercial operating system.

Tourism contributes nearly 6 per cent of Australia’s employment and earns about A$17 billion in exports.

Ends / 22 March, 2005

Totally Teetotal on Technology

Can you survive a week without your mobile and Blackberry? Yeoh Siew Hoon goes cold turkey in the golden land of temples – Myanmar

I’ve just been reading a report about what it takes to keep the 21st century business traveller happy.

Apparently, the four top requirements are a direct flight, a flat bed, a Blackberry and being met at the airport – so said 1000 business travellers who were surveyed at the recent Business Travel Show in London.

According to the survey:

  • 62% said a direct flight would make their journey more enjoyable
  • 48% craved to see a chauffeur hold up a card with their name on at their destination airport
  • 46% said they wouldn’t be parted from their Blackberry for the world
  • 43% longed for the undeniable luxury of a flat bed on their long-haul flights

So there we have it – the 21st century business traveler is a spoilt and insecure species.
 
Spoilt because he or she craves luxuries and comforts and insecure because he or she can’t do without their communication devices – some psychiatrists believe our fear of being without our mobiles or Blackberries stems more from insecurity than conscientiousness about our work.

In other words, we all need to be needed and we all want to feel indispensable in our jobs. Imagine if everything ran smoothly while we were away and were out of touch …

Anyway, the survey got me thinking that if they were ever to do similar research on what it takes to keep a 21st century leisure traveler happy, I am quite sure that top on the list would be no mobile phones and no Blackberries.

I say this because I have just spent a week in Myanmar, mobile-less and email-less.
 
And I am glad to say I survived. In fact, more than survived. I felt a sense of freedom and liberation that I had not felt in years. It was like walking on winged feet through a golden land of temples.

At first, it felt strange. In the first few hours of arrival, my mind kept wandering to my phone and laptop, wondering what messages I was missing and if I had missed any deadlines. My fingers actually started to itch.

Switching off my mind was infinitely harder than switching off my electronic gadgets.

It’s hard when you are an SMS addict, like I am, to suddenly go cold turkey. But let’s face it, if you have to go cold turkey, Myanmar is the best possible rehabilitation clinic on earth for us urban, email, mobile phone junkies.

This is a land that is timeless. It’s a place steeped in time. People have time. They take time to do things. They do not rush. They sit. They talk. They pray. They smile a lot. They do not have much but they have a lot.

It teaches you not to hurry because why worry? There is time.

By the time I went to bed at the Pansea that first night, I was in step with Myanmar.

I dreamt of white clouds, not Blackberries.

During the course of the week, there were temptations thrown my way. Perish the idea but some hotels now actually have business centres with Internet facilities.

The temptation was strongest on “The Road to Mandalay” cruise from Mandalay to Bagan where I had to spend three nights on the ship in really close proximity to an Internet connection.

It was tough but whenever I felt the old habit creeping up on me, I immediately ordered a gin tonic, recited Rudyard Kipling and counted flying fishes.

I therefore recommend Myanmar to any 21st century business traveler who wants to learn to do without his or her Blackberry.

Truth is, it’s amazing how easy it is to do without when you are forced to do without.

Ends / 21 March, 2005