Automated Information Exchange in the Online Travel Market

Introduction

The online travel industry is growing rapidly. Business and leisure travelers are flocking to the web to plan and book trips. Jupiter Communications predicts that online travel spending will grow from $4.2 billion in 1999 to $16.6 billion in 2003.

The online travel industry is extremely competitive, with many players and categories competing for the dollars of online customers. In order to remain competitive as the industry grows and matures, online travel businesses will need to succeed in four strategic areas:

establishing market share by attracting, engaging, and retaining customers.
generating revenues by converting lookers to bookers.
taking advantage of the internet as a distribution channel.
reducing occupancy rates and increasing profitability by selling distressed inventory.

A single online travel company can't succeed at these goals alone. Travel companies need to work with partners to build compelling sites that hold customers' attention and stimulate purchasing, and to reach customers on other sites around the web.

To make travel sites engaging to visitors, travel sites need to provide a broad selection of relevant and compelling information, aggregating content from external sources, such as travel guides, weather information, news, and providers of complementary travel services.
To convert lookers to bookers, travel sites need to encourage buyers to remain on the site long enough to buy, and to provide visitors with an effortless path from browsing to buying. To do this, sites need to tightly incorporate external content within their sites, integrate that content with the transaction process, and personalize content to save steps in the buying process.
To leverage the web as a distribution channel, travel sites need to be able to distribute content to many distribution partners, and to provide targeted promotions to those partners.
To liquidate distressed inventory, travel sites need to send customized notifications of promotions to partner sites and frequent customers using the web and e-mail.

All of these techniques have a common requirement: the ability to aggregate content from business partners and to distribute content to other partners. As the online travel industry matures and accelerates, businesses will need to automate the process of aggregating and distributing content. Automated content exchange will help web businesses:

reduce the time-to-market to deploy innovative new services.
scale to handle more sources of information and more distribution partners.
tightly integrate external content to facilitate ease of use and personalization.

Market Growth

The online travel industry is growing rapidly. Business and leisure travelers are flocking to the web for greater convenience, selection, personal service, and good deals. Jupiter Communications predicts that online travel spending will grow from $4.2 billion in 1999 to $16.6 billion in 2003. Online travel is only beginning to make its mark on the travel industry as a whole, accounting for 3% of all travel spending in 1998.

The online travel industry needs to grow and mature in order to make inroads into the 97% of travel spending that is still spent in traditional channels. The online travel industry is also extremely competitive. Many sites in a variety of categories are competing for a share of the online travel dollar, including:

online travel agencies
brick and mortar travel agencies
travel suppliers: airlines, hotels, rental cars, cruises
consumer portals
specialty portals (geographical and special-interest)
travel intermediaries and reservations services
corporate extranets
travel discount sites

Online travel businesses need to succeed in four main areas in order to compete and grow:

establish market share by creating a compelling experience to engage and retain customers.
drive revenues by converting lookers to bookers.
expand and leverage the web as a distribution channel.
increase occupancy rates and increase profitability by selling distressed inventory.

Compelling Experience

Travel web sites need to create a compelling experience in order to hold the attention of customers and to keep them coming back. Online travelers want a broad selection of information to choose from, and they want that information to be relevant to their needs, up-to-date, well-presented, and delivered in a useful manner.

Travelocity, the online travel agency operated by the SABRE travel reservation systems, integrates content from Lonely Planet travel guides to help customers research destinations around the world. Travelocity also provides rich descriptions of hotels, including photographs and detailed information about amenities. Customers can search Travelocity for hotels with specific amenities, for example, to find hotels with conference facilities or golf courses.
WorldRes is an online travel intermediary focused on the leisure travel market, providing booking and marketing services for small hotels and bed and breakfasts. WorldRes provides a compelling travel planning service for leisure travelers by bundling hotel information with related information about restaurants, music festivals, ski vacations, and other leisure services.
The American Express online corporate travel service provides maps and weather information, so travelers can find their destinations and bring the right clothes for the weather.
Northwest Airlines delivers up-to-date flight information to customers' pagers.
BizTravel sends flight arrival information, gate information, and weather updates to customers' pagers, and synchronizes travel schedule information to customers' handheld organizers.

In order to provide visitors with a compelling selection of information and services, online travel sites need to manage the aggregation, integration, and distribution of content.

Sites need to aggregate a variety of content from multiple partners, including destination content, maps, weather information, news, and product and pricing information for complementary services. The information needs to be kept accurate and up-to-date.
Sites need to integrate content from multiple providers with a site's own content. Sites need to apply appropriate formatting and branding to external content. And sites need to apply consistent tags to external and internal content to facilitate structured searching. If Hilton refers to its fitness centers as "fitness centers" while Radisson calls them "health clubs," Travelocity needs to apply consistent terminology to enable visitors find all the hotels with free-weights and treadmills.
As customers use portable devices and web services for more travel tasks, travel sites will need to deliver notifications and schedule information to pagers, cellular telephones, handheld devices, online calendars, instant message services, event planning services and other network appliances and applications.



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