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[ Posted on June 1, 2001 ]


Special Feature
Online Business Travel Booking Part 1 – Consumer Travel Sites
By Gina Shaw
In this first part of a two-part series, we take a look at the web-based, publicly available products for the self-managed traveler. In part two, we'll compare the products that are customizable and incorporate corporate preferences – geared towards the managed traveler.

If you Web it, they will travel. Leisure travelers have already migrated to Web-based travel booking in droves. In 2000, US online consumers bought $12.2 billion of leisure travel on the Web. That's 3% more than originally forecasted and double what they purchased in 1999. But business travelers have been more reluctant to dip their toes into online travel planning. At a recent meeting of the Association of Corporate Travel Executives, ACTE president Ron Wagner said business travelers still find it easier and more convenient to speak to a travel agent.


Compare the Sites

Check out our chart on seven of
the players in online consumer travel
planning. We compare features like
personalization, wireless access, and
destination information. We also asked
each search engine to give us their
best price for:

  • Washington National to
    Atlanta, with less than 14
    days advance purchase
  • Chicago O'Hare to LAX,
    with 21 days advance
  • Newark to London Heathrow,
    with 21 days advance
None of the three fares involved
Saturday stayovers.

So how did our players do? See
what you think!


But that may be about to change as Web travel portals fine-tune their offerings and make their services ever more inviting to the self-managed business traveler. Forrester Research predicts that online business travel booking will skyrocket to $20.3 billion in 2004, from $4.9 billion in 2000.

Many of those travelers will be using proprietary corporate online travel systems mandated by higher-ups in the office food chain. Since travel represents the second-largest controllable business expense (ranking only behind salaries), the opportunity to save money with a controlled and self-service travel system will become more irresistible. "The beauty of an online booking program is that in general, some companies are seeing a 20% reduction in the average price of a domestic airfare," says Kate Rice, an analyst with New York's Jupiter Research.

Large companies are likely to invest in comprehensive, customizable on-site systems like those offered by Sabre/GetThere, E-Travel, TRX (ResAssist) and Worldspan (Trip Manager) that allow them to incorporate travel policy and monitor compliance. A more recent entrant into this marketplace is OAG who has partnered with Xtra On-Line to combine its world-leading flight data with XOL's technology to launch the OAG Travel Network. Look for a comparison chart on managed travel products next time.

But many mid-sized and small businesses will be looking to public, all-purpose online travel sources to help them save money and plan travel more efficiently. "Roughly 30% of Expedia and Travelocity customers are business travelers," Rice says. "That's why they both have introduced separate sections of their site." Makes sense, since the small business travel market is expected to grow from $70 billion in 1999 to $90 billion in 2004.

Can't tell the players without a scorecard
Travelocity and Expedia dominate the leisure travel market, ranking #1 and #4 respectively in Forrester's "Web travel winners" survey. (Auction site Priceline.com finished second, while Southwest Airlines ranked third.) They also appear to have a clear head start on the competition – in terms of name recognition and total content. But a range of other online travel portals and services, from Biztravel.com to Qixo.com, are nipping at their heels in the battle for a share of the online business travel market.

Who will come out ahead? A lot of it depends on which sites are savvy enough to meet – better yet, anticipate – the business traveler's needs. "Travelocity and Expedia have had it easy. Business travelers were coming to them anyway, without them going after that market," says Jupiter's Rice. Other sites seeking to make inroads with the business road warrior should remember one key principle: "Make it easy. Travel is a really personal thing. It's somebody putting their rear end in an airplane seat, going away from home, doing their job, and keeping up with what's going on at home. The big thing is to make it really convenient for the traveler. That means things like improved notification of flight delays, so that you always know what's going on with your flight and your gate. It's a system that does the work for you."

Personalization is also key, according to consumer surveys. Stored personal preferences ranked as the most important feature in a Web-based business travel solution for 55% of respondents in a November 2000 Jupiter survey. Some business travel online services capitalize on this priority with a comprehensive passenger profile that lets users assign weight to different factors – the desire to maximize frequent flyer miles versus the need for low fares or no flight connections, for example – as well as including everything from special meal preferences to favorite rental cars. Destination information came in second in the Jupiter survey, with 38%; and live phone customer service and the ability to have a unified business/leisure solution tied for third, with 35%. Only 13% of respondents ranked wireless updates as a desired feature, but that may rise as wireless devices improve. "Wireless is still something that's more promise than actuality," Rice notes.

Airlines fight for their share
It's not just all-purpose travel planning Web sites that want to appeal to the business traveler. Direct-from-supplier sites, particularly those operated by the major airlines, don't want to cede online travel booking to agencies, and more and more they're trying to add functionality that appeals to those business-travel priorities.

On April 9, for example, United Airlines announced the creation of 26 customized Web sites for each of the countries it serves, each with full access from all wireless and wired Internet-enabled devices. And in February, American announced that flyers could use its AA.com Web site to register for flight delay and gate change information to be delivered by voice message via phone, text e-mail, alphanumeric pager, text-enabled wireless phone, or PDA. Delta, which saw online bookings soar from 930,000 tickets in 1999 to 2.5 million plus in 2,000, credits the addition of Web access through wireless PDA to its Delta.com site for the lion's share of that increase. And often, of course, many airlines offer Internet-only fares through their direct Web sites that beat those available by phone or through other travel sites.

Not content with competing singly against powerhouses like Expedia and Travelocity, a number of major airlines will soon unite to offer what they hope will be the 1,000-pound gorilla of online travel booking: Orbitz.com. Orbitz is finally set to launch in June – or so we're promised – after many technical delays. So far, 29 carriers have committed to offer all their fares on Orbitz, including those special discounts offered only on their own sites and not available on sites like Travelocity or Expedia.

But some have criticized Orbitz as a potential antitrust nightmare that will control online airfare pricing and gouge consumers. The five major backers of Orbitz – American, Continental, Delta, Northwest, and United – supply 74% of US domestic travel, and potentially more if pending mergers go through.

Whoever comes out on top in the slugfest for the online business travel dollar, many analysts predict that technology won't replace the human touch entirely. "Business travelers' demands for immediate, specific information and itinerary revisions will force a continued reliance on live customer service agents who are available 24 hours a day, seven days a week," predicts Business Travel's Big Bang, a recent report from Jupiter. Nadine Goodwin, editor-in-chief of Travel Weekly, noted at a March 2001 panel on the future of travel booking that even the president of Travelocity, Terrell Jones, calls his travel agent when he wants to book an upscale family trip.

Who's the best?
Everyone has different needs – so which online tool is right for you in booking your next business trip? Check out our comparison chart of the features and services offered by seven of the leading online consumer travel sites: Travelocity, Expedia, Biztravel, TheTrip, I-tinerary, Qixo, and Sidestep and decide for yourself.

Next up in Frequent Flyer – a look at managed travel products.

 
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