Wednesday, June 14, 2006

Travolution@ITT - Part 9 - Lagging behind?

Arjo Ghosh from Spannerworks writes again:

Monday 7.30pm. Quote of the day: “Travel is 5 years behind online.”

To demonstrate why a never-say-die attitude can lead to amazing results, Australia came back from 0-1 down with six minutes to play to beat Japan 3-1 in the World Cup this evening.

So is travel missing the boat with digital? Are the huge range of medium/small size travel operators, agents, and suppliers embracing online as quickly as they should?

Everyone is still learning the rules - what works, what doesn't. The low-hanging fruit, for example in sponsored search, are less common. As the big players pour more money every day into search engine marketing each click increases in price, and every new customer costs more to win.

Although my link with football is less than tenuous, it's worth considering that online is still in its infancy and the cost-per-click advertising model so successful for Google, Yahoo! and many others is only six or so years old.

If a campaign is meticulously researched and designed well, the execution has a better chance to succeed, now matter when you start.

There's no such thing as “missing the boat” in online. Barriers to entry are low, knowledge is plentiful and easy to acquire and new ways of improving old formulas are constantly being created.

Between goals during Australia’s late victory, I had the chance to catch-up with a couple of experienced suppliers to the travel industry. They had strong opinions. “Travel is five years behind” (I quote) is the opinion. Everyone wants to get in and make it work, but talent is hard to find agency-side.

Tuesday 3.30am. The singing in the bar has begun. It's time to go to bed.

[Conference photos on Flickr]

Arjo Ghosh, chief executive, Spannerwork


Guillaume said...

Thanks Arjo for this post from Oman. I have a question for you and other attendees. Whoever says "Travel is five years behind..." is probably the same person who said that in previous conferences for the last 5 years.
What does that mean being 5 years behind? Compared to what/ which industry ?
- banks?
- retail?
- insurance?
- software?
- ...
I have read from Hitwise that travel products represent 33% of all online transactions in UK. Surely the travel industry is not doing too bad no ?

You say "As the big players pour more money every day into search engine marketing each click increases in price, and every new customer costs more to win." I agree but compared to traditional marketing methods like paper ads/ tv ads/ mailing...that is still relatively low. It is more about how you spread your marketing budget online Vs. offline.

Thanks again for your different posts from Oman. You seem to have a good time over there.


Arjo said...

I think that your point is spot-on. Throw away phrases such as 'being five years behind' are provocative. Many innovative websites have been from the travel sector and today some of the most sophisticated sites are often travel sites.

In terms of search travel is also very visible. The problem lies in the way in which many sites still promote themselves. In the sponsored search channels, such as Google Adwords, you can often see companies bidding on terms that really should be negative matching, that is keywords that you cannot convert.

If you search for e.g. 'Greece villas' and lots of sites come up for villas in Spain then the loser is the customer. They click on sites thinking that their will be villas for their destination and instead get irrelevant content. The only winner here is the search engine (short-term).

Many of the new technologies around now, including those that allow sites to pull content such as Google maps via 'APIs' are easy and low cost to implement. If 30%+ of UK online transactions are travel-related I wonder if the investment in web technology is comparable - for most sites I doubt it.

In the case of Natural search, or search engine optimisation, the picture for travel customers gets more confusing. Many sites have visibility for inventory they don't sell and for every site the user has to input details into e.g. flight search tools again and again.

To make matters worse, many specialist areas are full of intermediaries (affiliates and agents) who do not sell anything, adding confusion to the user journey.

The problems for users in the area of search in travel are a combination of the dynamics of search and website technology. Those sites that embrace, for example multimedia search, will gain an advantage and hugely improve the user journey.