Sharing The Travel Industry's latest Technology
Posts tagged adventure travel
Facebook Consumerism?
Oct 29th
Microsoft’s recent $240 million investment into Facebook.com has resulted in a valuation of over 15 billion dollars for everyone’s favorite social networking app. Why so much? Do we honestly believe that the company has a business / revenue model that would warrant such a price?
Many people have speculated that Facebook’s advertising announcement on November 6th will pave the way to revenues for this darling social community, but what are they thinking? Are they planning on leveraging all of the profile and demographic information to allow advertisers to send targeted advertising messages? If they are, so what? Are people really open to advertising messages when their primary goal on the site is to communicate and “SuperPoke” their friends? Look was happened / is happening to Myspace.com, once the site became saturated and cluttered with advertising, it started to loose its key influencer user base and their growth stagnated.
What about add on apps, or widgets? There has been a lot of corporate buzz about buying your own widget, and companies such as Tripadvisor, eBay, Zoho, Jobster, and Blue Nile have all created or purchased existing apps. These widgets are used to complement the user experience on Facebook and to have banner ads or links back to the corporate site. But this whole process still needs to have a long tail marketing approach, users are there to communicate, if you don’t facilitate that, then your app will not survive.
How does this relate to the travel industry? Can a connection be made between travel experiences and face book? Would users be willing to share their experiences in a non-travel related site? How can a travel company effectively advertise or promote using this media?
There are 197 applications that attempt to bridge the gap between travel and the general online community. The sad thing for travel industry companies is that the most popular apps have the least functionality. The most active widget is one that allows you to have an image of a car on your page, and your car gets better with more points. This is followed by a number of apps that show a dot on a map or a flag from the countries that you have visited. You may speculate that this is a result of Facebook apps being in their infancy, and that greater functionality will follow, but that is not the case, there are some apps that are not popular that have a great list of features, one app Travel Map can:
“Plot your travels with this quick and easy tool and show the world how well-travelled you are. Brought to you by Travellerspoint, where you can also upload photos, start a blog and get all the travel help you need.”
This sounds mightily impressive until you realize that there are only 388 daily users.
What is the point?
If you are thinking about creating a widget for Facebook, keep it simple, complement the communication process, and give friends something to chat about. Have a soft ad, and link to your site through the widget. You may want to finish your development before November 6th, as there are going to be some BIG changes.
Amazing Online Reservation Statistics
Aug 30th
Recently I found an article that combined a number of interesting statistics relating to online reservations and sales through the Internet for the travel industry. These are really worth looking at:
- In 2007, nearly 40 million U.S. households will book travel online, spending $86 billion Web travelers now make up 79% of the U.S. travel population and 55% of them buy leisure travel online.
- High-income travelers, households with annual incomes of $100,000 or more a year, account for just 16% of the U.S. online leisure travel population – a market that represents 10.9 million households and spends $60 billion on leisure travel.
- In November 2005, reports that 79 million American adults are now using the Internet to plan their trips. Also growing rapidly is a propensity to book online, with nearly 65 million U.S. adults now booking this way.
Webtrends: Passport To Success
- Online sales of leisure and unmanaged travel in the U.S. are estimated to be $122 billion in 2009 – up from $65 billion in 2005.
- Half of U.S. interactive marketers questioned by Forrester Research in April 2006 said that they either used or planned to use blogs.
- The average rate for room nights booked through travel agents was 33.3 percent higher than the average rate for room nights booked via the Internet.
- In 2007, nearly one-third of all reservations in hospitality in North America will be generated from the Internet (29% in 2005).
- By 2010, more than 45% of all travel reservations in the U.S. will be done via the Internet (Merrill Lynch, HeBS).
- By 2010, the Internet will contribute over 45% of all travel-related bookings in North America.
- The ratio between the direct and indirect online channel continues to improve in favor of the direct channel: from 52:48 in 2002 to 56:44 in 2006; it is projected to be 62:38 by 2008. Some major brands already enjoy a very healthy 80:20 direct vs. indirect online channel ratios.
- It is much more expensive to book through a third party:
- Customers were more satisfied with the Internet travel service provider they last purchased from than they were with Internet travel services in general.
- According to a new report from PhoCusWright, Inc., next year, for the first time, transactions on the Internet will account for over half (54 percent) of all U.S. travel bookings.
What does it all mean?
There are defiantly trends that emerge from all of this information, but it is safe to say that online sales for the travel industry are becoming the norm. There are many vendors and resellers that will help distribute products for tourism companies, but the wise company will always give the customer the ability to accept bookings through their own website.
Accepting bookings on a companies home page will save company from paying high commissions and booking charges for each of the products that are sold. This passes on savings to the consumer and the company with the inventory, and eliminates the unnecessary middle man.
Check out www.Rezgo.com if you are interested in a powerful booking solution for your tour inventory. We created Rezgo with the latest trends in mind.
PhoCusWright’s Predictions on the Long Tail of Tourism
Jul 24th
Long Tails
For those of you that are not familiar with the long tail of tourism, the Long Tail includes the more diverse, less popular travel and tourism products. The breadth of these companies makes it attractive for all of the niche markets that are growing. This is where the market is predicted to experience the largest growth.
New technology is benefiting the consumer to enable greater access these smaller companies, thus helping the industry as a whole.
PhoCusWright offers five predictions about the future of the Long Tail in travel:
Prediction 1: The Long Tail era will drive a new economy.
Prediction 2: The Long Tail facilitators – content providers, software suppliers and ASPs – are in pivotal positions.
Prediction 3: Technology and standards will evolve.
Prediction 4: The democratization of supply will open up new marketing and packaging opportunities.
Prediction 5: The success of the Long Tail in travel is directly proportional to the quality of search – making metasearch, geographically-oriented search and vertical search key enablers.
The potential for tour operators and software developers to great greater access to the end consumer is growing every day, you can only imagine what types if niches will be catered to. (Space Travel Anyone?)
CRM the ‘Must Have’ for all Tourism Companies
Jul 12th
Way back in 2002 the Canadian Government released some findings on how the Retail Travel and Service Industry (RTSI) was undergoing drastic changes. They were picking up on the fact that, yes, customers are price sensitive, but retaining customers is a much more effective way to grow your revenue stream. The Canadian Government noted that the tour and travel industry is composed of some early stage adapters they still mention that one of the most critical challenges facing the RTSI is the adoption of the new e-commerce economy.
Some interesting findings that can be taken from the report are:
- It is six times more costly to service a customer through a call center than via the Internet, a tool that the RTSI is adopting rapidly.
- It is up to 10 times more costly to generate revenue from a new customer than from an existing customer.
- A 5% increase in retention rate can increase company profits by 60-100%.
- Referred customers generally stay longer, use more products and become profitable customers faster, a consumer pattern familiar to most stakeholders of the RTSI.
It is becoming very clear that to excel in this modern e-commerce economy, one must set up a great CRM program, focus on relationship building and hold on to those customers for the long haul. The report states that an effective CRM plan “…translates into faster service, higher customer satisfaction, customer retention, customer acquisition, repeat purchases, lower cost and profitability.”
Fred Reichheld spoke to the advantages of the “The Loyalty Effect”:
- Customer Retention: CRM enables a company to retain loyal and profitable customers and channel members. According to the International Data Corporation, it costs online merchants from $0.90 to $2.67 to get a visitor to their website for the first time. These companies must find a way to achieve repeat business in order to justify their initial acquisition expenditures. CRM through its extensive data warehousing solutions could help companies attract and retain customers.
- Customer Acquisition: Based on known or learned client characteristics, CRM may assist companies in acquiring the right customer through effective targeting and segmentation.
- Lower Cost: The automation process minimizes paper work and manual labour.
- Customer Loyalty and Satisfaction: One of the prominent features of CRM is its ability to create the opportunity of mass customization. Increasingly, today’s traveler wants customized products. When the service is personalized and tailored to meet the preference and choice of the customer, client satisfaction can be expected to increase. Customer satisfaction, over time, builds allegiance.
- Profitability: All of the factors listed above translate into profitability. Annual customer profits increase over time as the client – agency relationship expands. CRM can offer additional items to the companies that provide new profitability curves.
It just makes sense to take care of those that you are already servicing, and advocate for your product is worth 10 times the amount spent on attracting your initial customer. There are many practical (and inexpensive) ways to ensure you have an effective CRM plan, here are a few small tips that come to mind:
· Invite dialouge: Have a blog, a forum or a public rant wiki on your website, people need to feel that you are listening, and do listen!! Take what is said seriously, and respond to every posting.
· Keep them up to date: Have a newsletter that is more then a sales message, help and educate them with articles and personal experiences, this gives your business a warmer relationship with your clients. Update your website!! Keep your clients interested in what you are doing by staying fresh and continuously updating.
· Personalize all information: It is so easy to have an auto-filler that will help you customize all of your contact messages. It ads a personal touch, very worthwhile.
· Check up on your stars: Routinely, proactivly contact the greatest 20% of your client list, don’t wait for something to go wrong before you say ‘hi’.
Unique Travel is the Perfect Online Niche
Jul 6th
National Geographic Adventure publisher Francis X. Farrell recently had an interview with the Adventure Travel Trade Association and spoke about the emerging trends with adventure travel. The interview really is beneficial for those that are looking for new ways to market and package their unique and adventurous tours. He really is trying to shift the old marketing focus away from demographics and focus on consumers spirituality. This paradigm shift towards sustainable authentic experience is driving the new wave of the tourism industry.
Sites like gapadventures.com and adventures-abroad.com have realised this and are taking full advantage of this new wave.
So what does this mean for the unique and independent tour provider? Two words, GET ONLINE!! There is a thirst for unique and different tours that are not found through traditional travel channels like travel agents. They shy away from large “corporate” sites and are scouring the new for new ideas.
Your site must have an informative and attractive layout in order to establish trust with the clients, and then it must also have booking capabilities. This will ensure the growth of your business.
We have started amazingtours.rezgo.com to showcase great and unique tours that we have found.