Blog homeYesterday in London 3 Google executives took to the stage at ABTA HQ and in front of an assembled crowd of travel industry people (and a few online marketing agencies!) they outlined their roles and took questions and answers.
On the Travolution blog I have written about CPC inflation, the UK trademark discussion and a little bit about “Troogle” (or what Google could do in the travel sector). See Travolution blog post
Personally I thought it was a very interesting morning and a big thanks should go to Google for agreeing to it.
What stood out for me was the denial that Google were going to do anything to significantly enhance travel functionality on the Google site. Daniel Robb’s words were:
Nothing I have seen or heard about that is either planned for meta search or selling as an agent
I am not sure this denial helps us for three reasons:
- As reported in the Seattle Post Intelligencer (not my local paper) - Google were bidding against Expedia and Microsoft for Farecast (before Microsoft won) - hence it seems that Google do want to get into enhanced travel content / functionality game - they just don’t want to tell us about it quite yet.
- The UK Google travel team are not, by Google UK’s own admission, always in the loop regarding developments to the core Google travel products. They are more of an advertising sales team than anything else. Hence it is possible that Google are planning something but Daniel Robb doesn’t know about it. Personally I wouldn’t like to work for an organisation where I am not kept in the loop about stuff that impacts me and I am responsible for.
- Google are already in meta-search - just they happen to use keyword search to do it. What Google are not in is price comparison….. but price comparison != meta search.
Who is safe in the brave new world?
One of the points I made yesterday was about how only those companies at either end of the spectrum are safe (or perhaps are the safest). [Referring to B2C or B2B2C travel - not business travel or group travel]
The consumer end of the spectrum
In travel - at one end you have the consumer. Consumer behaviour for online travel generally starts with a visit to Google. A consumer traveller will, via Google, visit 7 travel websites prior to transaction for OTAs while the number is only 3 sites visited prior to transaction for tour operator type travel products. (Source: Google’s own figures announced yesterday from research undertaken by Comscore).
Google’s number one aim has to be to keep this status quo.
The last thing they want is for what I call the “Amazon.com ification” of the travel industry. For example take book sales - you tend to go to Amazon and then start searching. Even if it is an out of print book you start on Amazon because they have those details too. You may end up buying from somewhere else, but the book reviews drive you to Amazon initially.
Although there are plenty of travel specific sites that are aiming to be the site from where you start searching the opportunity is there for one of the big generic web players (like Microsoft / Yahoo / Google) to take this role in the B2C travel industry. Microsoft have an opportunity (now having purchased Farecast) - but will they be able to take on Google? That will certainly be their aim.
The reservation end of the spectrum
The other “safe” companies are the reservation system providers. Bookings end up in reservation systems regardless of how they got there. Of course, there will be fewer reservation system providers in the future because there could be fewer travel companies…… but that is a different article!
In between….. join the dots
Between the IT systems that own the consumer (Google at the moment) and the reservation system providers is a whole mass of systems all joined with spaghetti. You have
- Big online travel agents (OTAs)
- Meta search / price comparison sites
- Highstreet agents
- Traditional agents
- Traditional tour operators
- Travel inspiration / community / travel guide websites
- etc
These guys are all competing in the middle ground - not really impacting either the Google / Microsoft battle nor the competition between reservation system providers. Us guys on the ends can keep watching while destruction in the middle continues in an “Alien vs Predator” way.
The problem for being in the middle ground is that it is an uncomfortable place to be….. if you start taking too large a slice of the pie…. then the suppliers find a way to work around you…. if you think Expedia is taking too much commission - just go direct…… hence if you are in the middle - even if you have a position of strength - you can’t make use of it that much because the competition is too fierce.
Reinventing the travel industry
What is happening is that both ends of the spectrum are moving towards the middle.
Microsoft is coming towards the middle with their own vertical search engine….. reservation system providers like Comtec are moving towards the middle with Travel.co.uk [now no longer part of Comtec].
From the consumers end I want to see Google do a good travel vertical search engine. As an industry we need a specialist metasearch that doesn’t just have the top airlines, hotel chains and car hire companies. I want to see small tour operators and activity organisers in the mix as well. Google could deliver this.
From the reservation system suppliers perspective we need to start moving towards the centre ground. Take the humble hotel PMS (property management system). This system knows whether you read the Times or the Telegraph or whether you prefer coffee or tea. This information (and other such data) would help at start of the hotel selection process.
So there you are Google - if you want to help the consumer and disrupt the travel industry…. this shows you how. However, I expect you are now too addicted to travel industry advertising revenues hence will wish to maintain the status quo….. This leaves you wide open to Microsoft (who don’t have travel related advertising revenues to protect)…… which probably spells a long term problem for Google. Of course, this does somewhat rely on Microsoft being able to convert the opportunity they have….. they don’t have it in the bag yet.
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