roll for initiative

It’s time for another round of me talking about things I really have no bidnez talking about.

Today’s installment relates to online travel booking sites, like Expedia, Travelocity, Hotwire, Orbitz, Priceline, etc etc etc. There are literally (READ: figuratively) TONS of them. Which is good if you’re looking to buy a cheap ticket. As a consumer, you have all these options at your (literal) fingertips and the cost of switching from one site to another is nil. Which I guess is the problem with the ENTIRE online retail sector. With absolutely NO cost associated with switching retailers consumers have no reason to base their purchasing decisions on anything else but the final price.

Let’s go back to our travel sites for a minute. If I want to go to Puerto Rico for instance, I can go to all major sites and see how much tickets from each site costs me. Today, a flight from MeHomeTown to SJU costs $431 on Travelocity, $435 on Expedia, $435 on Hotwire, and $437 on Orbitz. (Side note: The bastards at Orbitz try to trick people by saying their ticket costs $378, but look at the fine print and you’ll see that the “total” cost is $437. Why the hell would I want to know just what the face value of the ticket is without all the airport taxes and other related fees?! Don’t we all have to pay those?! All I care about is my total out of pocket costs, not some hypothetical price I’d pay if there were no fees and taxes. Orbitz folks - that’s a stupid, cheap trick and you know it). In any case, if I were buying that today I’d buy the $431 ticket on Travelocity just because it’s $4 cheaper than the others. I can do this because I have absolutely no loyalty to any of those sites. None whatsoever. If one of them was 50 cents cheaper than the other I’d probably go with that one.

(To make matters worse for the good people at the online travel sites … I just found out about Kayak.com, which does all my comparison shopping for me! If you don’t know about Kayak.com, you should check it out next time you’re trying to save $3 on that LA to NYC flight.)

So what’s a biz dev person at one of these travel sites gonna do? Say you’re some poor MBA-type person at Expedia, trying to figure out how to stay competitive in a very very tight field. What’re you gonna do?

If I were said poor MBA-type person at Expedia, I’d look for ways to create some sort of loyalty within my customer base. Well, since I’m all pro-consumer research and shit, I’d first try to find out what the top issues with the online travel shopping experience were. Then I’d try to find out how customers and potential customers feel regarding loyalty to online travel sites. Only after doing all my research-y homework would I try to come up with creative ways to get customers to feel some loyalty to our site.

Obviously, I haven’t done either of the two things I said I would do, but off the top of my head, I think there are a few things that Expedia (for instance) could do right now that would help instill some sort of customer loyalty.

• Partner up with major airlines and/or credit cards to give bonus miles for trips booked on Expedia. Well, airlines probably wouldn’t like that too much, but I don’t see why credit card companies wouldn’t be up for such “synergistic” cooperation.
• Borrow a page from Amazon.com and set up an Expedia Prime(TM) account that provides discounts and additional savings for members. (Amazon’s Prime membership service gives you free 2nd-day shipping for all your orders for $79/year). The pricing and benefits provide by the yearly membership would be critical to the success and customer appeal of this program. The benefits to the customer are also critical, but vouchers for free meals, nights at hotels, or car rentals days at their destination would work. Or free upgrades to hotel room, car class, an even airline seats.
• Borrow yet another page from Southwest Airlines and give away big discounts or even free tickets for every 5 (or 10) trips booked on Expedia.

As you can see, all of these are variations on the basic customer loyalty program. Coffee shops use them. Airlines use them. Credit cards use them. Not being a poor MBA-type, I not seeing the downside of any of this.

So, any MBA-types and/or people who work at travel sites, why aren’t you doing this already?

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