Surfin' Vacation Sites

0 Comments | Insight on the News, May 8, 2000 | by Donna De Marco

Vacationers are bypassing travel agents and going online to research and book their trips -- sifting through hundreds of travel services that have come on line during the last few years.

The Internet has brought the world to our fingertips. Vacationers now compare airfares and routes -- even bid for hotel rooms -- with the click of the mouse. "It's all about putting consumers in control of their travel," says Michael Stacy, senior vice president of consumer marketing at Travelocity.com, one of the leading online travel services.

More than 54 million Americans, or 25 percent of the country's adult population, turned to the Internet to gather information, get prices or check schedules last year. That's up nearly 75 percent from just two years ago, according to a recent report by the Travel Industry Association of America.

"If you look at survey results, usage is off the charts," says Gary Leopold, president and chief executive officer at Boston-based Irma S. Mann Strategic Marketing Inc. "I think we'll continue to see exponential growth because more and more people are becoming comfortable with the medium."

The $4 billion online travel industry is made up of a wide range of sites, including bidding sites and Web auctions. Online travel sales are expected to reach $6.3 billion this year and soar to $16.3 billion by 2003, according to Jupiter Communications, an Internet research firm. The top two reasons consumers make travel and airline reservations online: convenience and comparison, according to Boston-based Forrester Research Inc.

"But the problem with the Internet is there's tons of information," says Tom Parsons, editor of BestFares.com, an industry magazine. "Every single Tom, Dick and Harry can get their information out there cheap and quickly."

A full-service travel site like Travelocity.com, for example, has access to 700 airlines, 50 car-rental companies, 46,000 hotels and more than 70,000 vacation packages. Other sites such as Priceline.com let travelers name their own price on airfare, hotel rooms and car rentals.

Eventually, "people will settle down in a comfort zone," says Terry Trippler, airline expert at 1travel.com, another online travel service. "Comfort level is a critical thing. A site with a comfort zone and a good booking engine will win."

But the abundance of travel sites, all offering the "best" deals with the "lowest" prices, can be confusing. Internet suffers are bombarded with ads and enticements. "The amount of information is overwhelming," says Leopold. "Consumers have to understand who that provider is and who stands behind the name."

Names that are instantly recognizable, such as American Express (tray el.arnericanexpress.com), can count on that recognition for credibility. Expedia.com, affiliated with Microsoft, has gained credibility because it is owned by the computer-software giant.

But Trippler of 1travel.com admits the Internet has holes, despite its wealth of information. He receives 175 to 200 e-mail messages a day from people who aren't able to get all the information they need, such as airport procedures and flight restrictions. It also takes time to sift through the hundreds of online travel resources available. Those tired of looking turn to shopping services such as Respond.com and Imandi.com. Companies such as E-Gulliver Inc. (egulliver.com) match online travelers and their interests with travel specialists. "If booking through the Internet, you want the benefit and service of someone who understands the industry," says Leopold.

Meanwhile, the advent of online travel services, including airlines beefing up their own online capabilities, is alarming traditional travel agents. "Airlines are doing what they can to remove the small travel agent," Parsons says. Most airlines have created their own Websites, making it even easier for consumers to book through them, and some now offer a 5 percent discount to consumers if they book directly. This summer, the industry will debut a new Website that features 33 participating airlines. "If you are dependent on point-to-point airline sales, you are going to go out of business," says Dick Knodt, president and chief operating officer of Vacation.com, a Washington-based travel service with a network of travel agents.

But industry officials say travel agents can survive if they are willing to change their strategy. "Consumers spend a lot of money on vacations and expect a certain kind of experience," says Knodt, who was former president and chief operating officer of the American Society of Travel Agents. "They still want human interaction." Travel agents provide expertise, save time and someone to hold responsible if things go wrong, industry officials say. "Once consumers have shopped around, they want someone to come in and say they're doing the right thing," Knodt says. "They want an expert to validate their choices."

Travel agents are reinventing themselves, nevertheless, becoming experts on particular vacations and destinations, as well as putting themselves on the Web -- sending e-mail messages to let customers know about deals. Vacation.com has 8,800 travel agents who focus on selling destinations, working with such suppliers as cruise lines and tour operators. "We market vacations," Knodt says. "We're in the experience business, not the commodity business."