Would your business cope if Google stopped sending you (free) traffic?

With the speculation that Expedia maybe a takeover target for Google (see Yahoo Finance) I thought now would be a good time to revisit how important Google has become to many travel companies.

Changing the face of travel distribution (UK leisure travel)
First a bit of history - a few years back (not that many) UK leisure travel was dominated by the high street (and a few call centres). Google came along and enabled, for the first time, businesses to put their products in front of consumers at less cost of distribution than through other indirect channels. Much of the growth in online travel has been due to organic (i.e. free) traffic from Google over the past 5 years.

Indeed, it has not just been a change in distribution habits from existing companies, but whole new companies have formed that would not have been in existence without Google. For example I know many smaller tour operators who, with 5 or so staff, can run profitable businesses. Previously they would have had to have a couple more staff for marketing purposes - and have produced a costly brochure - which would have made the small business model less viable . i.e. Google has enabled smaller travel businesses to flourish.

It hasn’t just impacted small travel businesses - I know travel businesses employing “thousands” where a strong proportion of their sales can be accounted to Google organic traffic. These companies, large and small, are now “addicted” to Google web visitor traffic and without that tap continuing to flow they could be in trouble. Some senior executives at these large companies don’t even realise how important Google has become to them so haven’t mitigated any risk this exposes them to.

Google becomes commercial
The question with Google isn’t really about traffic…. it is about free traffic. I would argue (without having any knowledge of what Google are doing!) that Google are dominant in “search traffic” while other websites, such as Yahoo, have “display” traffic…. Due to travel being so product search dominated, this is why Google is so important to the travel industry.

It is a fairly obvious point - but Google is a business. They have to make money. Indeed, they can’t just “sit still” but their investors want to see constant growth. It was only last month that the financial press reported that Google had missed 4Q profit target (as set by analysts). So Google are under pressure to perform. Travel may be  the answer.

Introducing specialist search
Google have 3 kinds of specialist search for travel (some with us for a while, some recent to the scene)

Flight search
Go to Google.com and search for “JFK to LHR” (without quotes). You will get a result set that looks something like this:

Yes you can “pay to play” (with the PPC adverts showing at the top) however there are also direct links to partners (CheapTickets, Expedia, Hotwire, Orbitz, Priceline and Travelocity) where you are navigated straight into a product page showing appropriate flight availability (or date entry search for that flight city pair). Regardless of whether this link is commercial or not (and I expect it is) Google will know how successful these mini-searches are.

If I were a flight selling travel agent, I would be concerned where this may be leading. The traffic is not coming your way (unless you want to pay for it and are a large player).

Hotel search / reviews / map
From an individual hotelier’s perspective hotels tend to undertake SEO on four aspects:

• The hotel name (normally quite easy unless you have a non-unique name)
• The location (town name, city name etc)
• Local attractions (harder - as there are multiple hotels all looking for the same slot)
• Events (harder still - because they are based around a certain time period)

However Google have begun to upset this a little recently (to the benefit of consumers but the detriment of hotel travel agents). Now if you search for a hotel - such as “De Vere Southampton” (without quotes) you find this at the top of the results:

This is all useful information to consumers. Clicking through to the top result (where it says 102 reviews, directions and more) you find this:

On that page you can find:

• Consumer reviews from 3rd party websites (including the capability to add your review straight into Google)
• Listing of hotel details (such as rating, number of rooms, services available etc)
• Photos & Videos of the hotel
• Contact details - including web address, postal address and telephone number
• Directions (on a map)

A full list of sources for these hotel reviews can be found on the search engine guide website .

This google page is impressive stuff - no need to for the consumer to go elsewhere for information - but perhaps only for pricing.

If I were a hotel selling travel agent, I would be concerned where this may be leading. The traffic is not coming your way (unless you want to pay for it and are a large player).

Search within a search
A new addition to Google’s impressive line up:

Search Google for “Hilton” (no quotes) and you find this:

The “problem” for big companies with “search within a search” are as follows:

• Competitors may soon be putting PPC adverts against what the consumer may think is an “internal” search (circumventing the trade mark search restrictions that many big brands have in place)
• Google can alter the results order (rather than Hilton when a user does a search on the Hilton website). For example if, on the Hilton website, a user searches for London - Hilton may choose to put certain pages first…. (for example information pages, commercial pages, a particular hotel etc) - however now that the user is first doing their detail search outside of Hilton’s site…. Hilton have no control over what order the first results will be in.

The Expedia / Google deal (rumour!)
So where does this leave the rumoured Expedia / Google deal.

I think it would be an interesting move for both companies. It would be most damaging to the larger OTAs (excluding Expedia) as they would lose a potential visitor stream and gain an even stronger competitor.

However it is with the product owners (the airlines, the hotel chains etc) where the most influence will occur. Historically, with thousands of small travel agents all selling their products, no single distribution channel had any leverage to negotiate the margins down or the commissions up. An Expedia/Google consortium may be strong enough to have an impact.

The one European OTA that would benefit from Expedia and Google tying the knot would be Opodo (a consortium of European airlines). It would take them from being a side show to key to how the airlines could react to commercial influence being exerted by a single, strong, Google/Expedia travel consortium. Which of course is why Opodo exists in the first place….. it is a Thames Barrier company for just this strategic eventuality….. useless until very useful indeed.

Incidentally, the University of the Highlands and Islands (Scotland) have a course coming up (in Inverness, July 9th 2008) called “Would your business cope if Google stopped sending you traffic?”. I think the risk of this outcome is slight - however there is every chance that Google will stop sending free traffic (or at least change the proportion of free vs paid) and this could be just as bad, commercially, for those that have been reliant on the free traffic gravy train for too long. I suggest companies try to break their addiction to free marketing before it is too late.

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