Orbitz has introduced "Total Price" hotel search results which now show base rate, taxes & fees per night upfront on the initial search results page.

Barney Harford

The company says it is now the only online travel agency that displays total pricing information up front and that its competitors only show base rates on their initial search results pages. Only later in the booking process do consumers see the total price they pay on other travel sites.

"With the launch of Total Price hotel search results we’re making it dramatically easier for consumers to search for hotels," said Barney Harford, president and CEO of Orbitz Worldwide.

"Until today, there was no convenient way for consumers to compare multiple hotels on a Total Price basis. Consumers had to click through to the details page for each hotel to see how much it would cost to book. With Total Price hotel search results, Orbitz is changing that."

Orbitz hopes its latest move will help create loyalty while attracting new customers.

The company also launched the "Hotel Fee Cut" promotion, which reduces fees on all of its hotel rooms booked by July 15.
 

"It is unacceptable that one in three consumers going to book a plane ticket online is being ripped off or misled and confused," Kuneva told a news conference.

"But my message to industry is clear, act now or we will act. We will need to see credible evidence of improvement to clean up these sales and marketing practices within the airline sector by May 1st next year or we will be left with no choice but to intervene."

Kuneva was speaking after the release of a report of an investigation by Brussels into misleading advertising and unfair practices on airline ticket selling Web sites. The investigation revealed that over half of the 226 Web sites found to have broken EU consumer rules last November had not addressed their problems.

Many sites had multiple problems including pre-selcting the most expensive option, misleading pricing, unfair contract terms and advertising offers which were unavailable.

"This report shows there are serious and persistent problems with ticket sales throughout the airline industry as a whole," Kuneva said.
 

The chief executives of Expedia Inc. and Priceline.com said even with the convenience of online travel bookings and the large amount of useful reviews, customers wanting to go on a cruise still want to talk to a real travel agent to plan their trips.

Numbers from Phocuswright, a travel research firm, says total U.S. cruise revenue from ticket sales for 2007 was $13.4 billion, but only around 7 percent ($944 million) came from online bookings. Phocuswright estimates growth in online cruise bookings will grow to $1.3 billion in 2009, but that will comprise just 8 percent of the cruise booking market.

Seventy percent of total online cruise bookings were made via online travel agencies in 2007, instead of cruise company Web sites. "Although OTAs (online travel agencies) represent the lion’s share of online cruise bookings, the cruise lines themselves are playing a good game of catch up," said Douglas Quinby, senior director of research at Phocuswright, according to Reuters. "We expect the split to be 60/40 by 2009."

Priceline CEO Jeff Boyd said that customers want to know the details of a cruise vacation. "What kind of restaurants does this cruise ship have? Do I have to wear a necktie when I go to dinner? It’s stuff like that that people really want to know," he said.

"Consumers tend to be more reluctant to basically shop online and plop down 1,500 bucks without talking to a human and getting an assurance that yes, this is a nice ship."

Both Priceline and Expedia list customer service phone numbers for people who need more information on cruise bookings.
 

Users on average make 12 travel related searches, visit 22 Web sites and take 29 days from the first time they search until they make a purchase. Forty-five percent of transactions happen four weeks or more after the first search. Time spent online is lengthy allowing advertisers to reach and influence users as they search for information.

On average users visit a site they will make a purchase from 2.5 times. Only 10 percent of transactions take place on the first search referral to a given site, and 38 percent of transactions happen at four weeks or more after the first visit.

Fifty-four percent of users started the shopping process with a generic product or destination search term, and 10 percent did not use branded search terms at all. More than a third of travel buyers use a generic term as the last search before they purchase.

Users change the type of keywords they use as they progress in the purchase process. Twenty-nine percent start with a non-branded search term but end with a brand search term.

Google U.K.’s Robin Frewer, Industry Leader, Travel said, "This research proves travel searchers are becoming more brand fickle – spending a large amount of time researching their desired purchase, and considering offers from competing brands."

"The fact that users are using more generic search queries gives ample opportunity for brands to attract new customers – and brands that are not present during these searches are missing out on sales."
 

"Travelers who have wholly embraced online booking enjoy researching travel online while those travelers who continue to use traditional channels feel overwhelmed by online travel research," said Diane Clarkson, Analyst at JupiterResearch and author of the report.

"In this competitive marketplace, online travel providers must find ways to both engage and simplify the online travel experience."

Cost considerations play an important role in how travelers research online and where they decide to make a purchase. Forty-three percent of travelers who use search engines are looking for discounted deals. Cost is weighed more than convenience in the decision to buy travel products in a package among more than half of travelers who bought a package.

"Success in the online travel marketplace will increasingly require both robust consumer content and competitive prices," said David Schatsky, President of JupiterResearch. "More important will be simplicity of research process. By providing consumers with one-stop-shopping where price comparison and consumer input can be obtained, travelers can make more informed decisions in less time and without anxiety."

Compared to European online travel growth, U.S. online travel has hit a plateau.

Jake Fuller of Thomas Weisel Partners said over all reservations at Expedia, Travelocity and Priceline would reach $33 billion in 2007, an increase of 7 percent from 2006.

Fuller added that about 30 percent of domestic travel reservations are made online and that it could grow as high as 50 percent. Online travel accounts for a about a fifth of sales in Europe, and 12 percent in Asia.

Michelle Peluso of Travelocity said the European market can be more profitable than the domestic market because travelers in Europe usually make reservations for both hotel rooms and airline tickets. Wholesale pricing allows travel agencies to package both reservations types together, with a markup for the customer and a profit for the agency.

“American Travelers Make Plans Online”

According to the survey, long weekend trips (defined as a three-night stay away from home) have become the most popular type of leisure travel. Leisure travelers take more than twice as many long weekend trips than they do week-long vacations.

"Long weekend trips represent an important opportunity in leisure travel and the online leisure marketplace," according to Susan Steinbrink, PhoCusWright’s market research analyst. "And while long weekend trips potentially offer travel providers lower margins, they do offer more frequent travelers and trips to target."

The less of a financial investment and shorter distance traveled for a trip, the more likely travelers are to purchase their plans online. Six out of every 10 dollars spent on weekend travel was purchased online versus less than three out of every 10 dollars for week-long vacation travel.

Close to two thirds of online travelers say that search engines such as Google and Yahoo influence where they purchase their travel plans and what plans they purchase.

 A Web site’s visual features also influence where travel plans are purchased. More than seven in 10 online travelers said that a Web sites use of video, pictures and online maps influence their purchase.

The survey revealed that 79 percent of gay, lesbian, bisexual, transgender (GBLT) respondents say they most often book hotel accommodations for personal travel, compared to 54 percent of heterosexual respondents.

By nearly a three to one margin, 22 percent of gays and lesbians chose “fair treatment of guests like me” as a top consideration for choosing a hotel for pleasure travel. When traveling for business, 16 percent chose this consideration compared to just four percent of heterosexual respondents.

The survey, done in conjunction with Witeck-Combs Communications, a firm with “special expertise” in the GLBT market, was conducted via a national online survey of 2,581 adults aged 18 and over.

“These results may further provide evidence of the love affair between gay travelers and the Internet,” says John Butler, Senior Communications and Marketing Strategist for Witeck-Combs. “The survey results also show us that many factors, not just price and location, go into hotel choices, and that’s no surprise for any consumer.”

One of the more important of these factors seems to be a hotel or travel company’s reputation for fairness to marginalized communities.

“What also stands out again is the reputation that a hotel property signals by treating all customers, including gays and lesbians, with fairness, said Butler.

“For most, that simply may mean welcoming with equal respect, which experience shows us actually differentiates one hotel brand from another in terms of true hospitality.”

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