Travel sites vie for lead

The online travel business is expected to take off this year, and companies are relying on site redesigns, partnering, and IPOs for a boost.

3 min read
The online travel business is expected to take off this year, and companies are relying on Web site redesigns, partnering, and even cash from initial public offerings to keep from being left on the ground.

Hoping to take advantage of the lack of a clear leader in the online travel market, Arthur Frommer's Outspoken Encyclopedia of Travel has revamped its site to reflect a new outlook and increased functionality.

The relaunch is designed to foster a sense of community, a goal of many e-commerce sites that have found that features such as chat rooms and bulletin boards increase traffic and, subsequently, revenue.

Frommer's is hoping the new community-oriented feel of the site will help earn it a bigger piece of what analysts say is the leading e-commerce category. "In terms of dollars, travel is the No. 1 consumer spending category online," said Nicole Vanderbilt, an e-commerce analyst with Jupiter Communications.

Frommer's is also playing catch-up to Microsoft, which has added new features to its travel site Expedia, and is reportedly focusing more of its vast resources on its Web-based free services such as Expedia and car-buying site CarPoint after announcing it plans to shut down Mungo Park, an adventure site that feature Internet updates on various expeditions, in February.

In November, Expedia added a mapping function called Expedia Maps as well as the Online Vacation Mall, where visitors can purchase complete vacation packages.

The new version of the Frommer's site highlights some of its more popular features, such as a daily newsletter of top travel deals and information. In its effort to bolster community, the site also features two new bulletin boards where visitors can swap travel tips and horror stories.

According to Christy Miller, online marketing manager for Frommer's, traffic has spiked since the new site was unveiled. In December, traffic was averaging 558,000 page views per week, compared to 997,000 for January. Miller attributes that surge to the relaunch.

"It's so much easier to use now, in terms of functionality and navigation," Miller said.

Frommer's is trying to break into the top tier of players in the online travel market. According to Vanderbilt, the top three sites right now are Expedia, Travelocity, and Preview Travel (PTVL), which launched an initial public offering in November to a somewhat lackluster response. Analysts attributed Preview's somewhat poor performance on Wall Street to a general downturn in tech IPOs, rather than serious concern with the company's fundamentals.

Others vying for the top spot include CondéNet's Epicurious Travel, Internet Travel Network, and consumer services company CUC International.

"There's not a clear-cut leader right now," Vanderbilt said. "They all bring very different assets to the table. They all have slightly different advantages and slightly different strategies."

Expedia, for example, has chosen to partner with suppliers such as Continental Airlines and Northwest Airlines, Vanderbilt said, while Preview has inked distribution deals with America Online and Excite that account for the majority of its revenues. Travelocity has signed a similar deal with Yahoo.

Vanderbilt believes that the Frommer's move to add technology "bells and whistles" to its site was a smart move. "Because [the travel industry] is such a complicated service, and there are so many different features and so many different steps, the technology is really important," Vanderbilt noted. "It's not about making basic decisions and then you're done. It's an investment of money and time."

Vanderbilt likened the online travel market to the competition between television networks. "It's like the TV network phenomenon: Three have floated to the top. Which is not to say that the smaller ones haven't tried, but they aren't at the top."