Giving travelers the confidence to hit the road
IN-DEPTH: Making it easier for consumers to find the best travel deals
Online travel agency Travelocity highlighted that great deals, especially on hotels, have given travelers confidence to hit the road and take to the skies in 2010. It is particularly encouraging to see that travelers recognize packages as an attractive option to save big bucks.
In order to assess the current sentiment and the impact of new initiatives of travel companies on consumers, EyeforTravel’s Ritesh Gupta spoke to Dr. Natasa Christodoulidou, assistant professor of marketing in the marketing department, California State University Dominguez Hills.Excerpts:
Polls conducted this year in the US have indicated that there has been a dramatic increase in travel intentions, indicating traveler confidence is on the rise. For instance, Travelocity’s second Traveler Confidence Report found that nearly half of respondents plan to increase their travel in 2010 as compared to 2009. How do you assess the sentiments as of today?
Natasa Christodoulidou: Last week, on April 6, DallasNews reported that American Airlines have observed an increase in traffic of 2.5 percent as compared over to March 2009; the load factor improved by 2.6 percent reaching about 82 percent. This truly shows that air travel in the big airlines has increased. In travelpulse.com, Allegiant Air reported that passenger revenue miles were up 16.4 percent as compared to March 2009. In organized group travel, Western & Oriental reported on travelweekly.com that travel sales were up by 28 percent for the period ending March 2010. These examples indicate that travel is quite up as compared to 2009 and looks very promising.
It is being said that consumers’ expectations of value and desire to shop for the best deals have changed for good. How do you assess the situation from consumers’ perspective?
Natasa Christodoulidou: Due to the economic crisis, consumers have become quite sensitive to pricing when travelling and dining out. In addition, the consumer has become very Internet savvy; this means that the average traveler will use the Internet to do research and forward the results to their friends if they are travelling together. This has quite a bit to do with social media and the way the younger population interacts with each other on an everyday basis.
Over the past few months, it has been stressed that customers can save big bucks by booking a vacation package. In fact, OTAs have extended the price guarantee to vacation packages. How do you assess such initiatives from an airline’s perspective?
Natasa Christodoulidou: The airlines have been offering vacation packages for a number of years. The OTAs have now extended the price guarantee to these vacation packages. The airlines if they have not already done so, will probably follow the OTAs’ extended price guarantee for these packages.
Travel companies have been trying to make it easier for consumers to find the best travel deals based on their preferences and flexibility. How do you think such initiatives have changed the way consumers identify and select deals based on what matters most to them?
Natasa Christodoulidou: Our consumers in the travel industry have become more “spoiled” than ever in having the information at their fingertips customized in a matter of seconds. Consumers are using meta sites to find everything from airline ticket prices, hotel prices, show tickets, and many other items related to the travel industry. It is very important to the traveler that an OTA recognizes his or her needs and can identify a “deal” based on what they consider most important to them. For example, when it comes to family travel, a number of consumers identify as the `breakfast included’ option as an important option for them to checkmark when they are checking for packages and/or deals.
Do you think delivering the best available and most compelling offers exactly at the time of searching continues to be the biggest opportunity?
Natasa Christodoulidou: I think as the economy picks up, consumers will continue to look for the most compelling offers but at the same time they will be looking for value. The “extra” or hidden fees will become of enormous importance and full price transparency may become a priority. Value may entail different components to different types of travellers but quality will continue to occupy a large part of that.
I strongly believe that the consumer needs to be captured and mesmerized at the time of searching as instant gratification continues to be a factor in travel purchases.
Facebook reached an important milestone for the week ending March 13, 2010 as it surpassed Google in the US to become the most visited website for the week. Recently, there were indications that easyJet is planning to introduce e-commerce section on Facebook. How do you expect the power of social media to nudge ahead of some of the traditional online travel booking and planning channels?
Natasa Christodoulidou: The power of social media in the past few months has surpassed every expectation. At the moment, every major hotel or airline has a strong presence in a number of social media outlets such as Twitter, Facebook, Myspace, etc. I believe that in the future social media will nudge ahead of some of the more traditional online booking and planning channels. On March 15 2010, Twitter announced that they have developed a new set of frameworks for adding the Twitter experience anywhere on the web without having to go to Twitter.com!
All these developments will lead to a new generation of social interaction and engagement on the web that we have yet to see. This will certainly impact the way we have been interacting in the traditional online travel and booking modes.
Search engine marketing is complex, but experts believe that it is still better off than offline marketing, considering analytics and testing, whether consumers interacted with it and booked etc. Would it be right to say that spends are moving towards online marketing?
Natasa Christodoulidou: That is probably a fair statement. While traditional offline marketing still remains important and should be used together with online marketing, it appears that online marketing has taken over in every possible dimension. More and more corporations are investing an increasing amount of dollars in search engine marketing and in particular search engine optimization (SEO). Pay per Click (PPC) has become part of everyday business in the travel world and referrals (such as where a traveler has arrived to a website from) are an essential part of the travel business. Marketers are relying on analytics and testing as they move forward with creating and utilizing new marketing adventures and campaigns in the travel arena.
Online Marketing Strategies for Travel USA 2010 Conference
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