ishc the ota perspective michael reichartz vp, market management
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ISHC
The OTA perspective
Michael ReichartzVP, Market Management
Expedia as a data source
Expedia Partner Services Group | 2© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary.
We have a unique view into the industry…
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 3
Source: Expedia, Inc. Feb 2010
5M+activities sold
5M+cars rented
35M+calls with customers
67M+roomnights
booked
25M+air tickets sold
2M+calls with partners
$21Bgross bookings
30M+traveler opinions
on TripAdvisor
58M+visitors/month
2M+packages sold
…And a unique view into consumer behavior
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 4
More than 850,000 flight
shoppers globally, per day
More than 78,000
activity shoppersglobally, per day
Nearly 864,000hotel shoppers
globally, per day
We have more than 58 million visitors to our sites every monthSource: Omniture Data 2009; Packages from Expedia Data Warehouse, Feb 2010
Nearly 6,800 packages sold
per day
Our view covers multiple segments…
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 5
#1 online travel agency globally, with a presence in 19 countries
Leading hotel specialist globally, with over 70 localized sites
Leading value-based travel provider
#1 online travel community, operating in North America, Europe & APAC
Business-to-business / private label brand
Full service travel management company operating in 24 countries
Expedia holds a leadership position in nearly every geographic market where we are present
Agency model providing hoteliers a geographically diverse source of demand.
The leading online travel planning site for booking hotels and flights in China
…And our perspective is global
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 6
Source: Expedia.com as of February 17, 2010.
19961998
19992000
2001
AustraliaFranceCanadaGermanyUKUS
Belgium
India
Netherlands
Italy
Spain
New Zealand
Ireland
Austria
Denmark
Norway
Japan
Sweden
Mexico
20042005
20062007
20082009
73 Hotels.com sites worldwide
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 7
Source: Hotels.com as of February 2010. ¹,²,³ Indicates multiple languages of the same site.
1991
US
20012002
20032004
20052006
20072008
2009
Poland
Russia Ukraine
Slovakia
Croatia
Estonia
Latvia
Lithuania
Turkey
Czech Republic
Greece
Hungary
Iceland
Argentina
Chile
Israel
VenezuelaTaiwan
South Africa
Singapore
Portugal
Philippines
NewZealand
Mexico¹,²
Korea
Japan
Hong Kong
Brazil
China
Colombia
Switzerland¹,²,³
Sweden
Spain
Norway
Netherlands
Italy
Ireland
Germany
France
Finland
Australia
Austria
Belgium¹,²,³
Denmark
Canada¹UK Thailand
Malaysia
Uruguay
Suriname
Peru
Paraguay
Panama
Nicaragua
Honduras
Guyana
El Salvador
Guatemala
French Guyana
India
Ecuador
Costa Rica
Belize
Bolivia
Canada²
Source: Expedia Inc. Tolgamart June 2009
We offer 124,000 hotels from across the globe
Americas50,000
EMEA61,000
APAC13,000
© 2009 Expedia Partner Services Group. All rights reserved. Confidential and proprietary. | 8
What we see as an OLTA
Expedia Partner Services Group | 9© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary.
We see a lot of visitors from international origins…
11 Mill Impressionsin last 6 months
APAC to AMER
49 Mill Impression in last 6 months
EMEA to AMER
JPY, -10%
CAD, -4%
GBP, 6%
EUR, 10%
2009 2010
…And exchange rates alter travel patternsUSD value in flux; 1 USD in foreign currencies YOY; January 2007-August 2010
2007 2008
Source: Oanda FX Data
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 11
Pound36%
Canadian Dollar23%
Euro8%
Japanese Yen-19%
Exchange rate influence on purchasing powerA family of four takes a vacation from London to Orlando4 air tickets and 1 room for 3 nights
Jun 2009 Var Jun 2010
Air $2,102 +48% $3,116
Lodging $224 0% $225
Spend $2,326 +44% $3,341
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 12
American supplier receives in USD…
Jun 2009 Var Jun 2010 FX
Air £1,286 +65% £2,116
Lodging £137 +11% £153
Spend £1,423 +59% £2,269 +11%
British family spends in GBP…
Leisure visitors to the US from the US, EU & UK are trading down, while visitors from APAC are trading up
1 - 2 Star 3 Star 4 Star 5 Star
Domestic US +2% +2% -4% 0%
EU +7% 0% -6% -1%
UK +4% +2% -4% -2%
Australia 0% -4% +2% +2%
Japan -2% -2% +2% +2%
% = Change in room nights share YoY Booking made in May – August for stays in September - December
Source: Expedia future stay data (booking made in May – August 2010 for stays in September – December 2010 vs. May – August 2009 for stays in September – December 2009
Despite economic uncertainty, a recent survey suggests a cautious recovery in business travel…
Source: Survey of over 300 Egencia clients, conducted August 2010 | Survey of over 100 Egencia clients, conducted October 2009
Are you planning to increase or decrease your travel budget in 2011?
…The recovery is reflected in the industry numbers
Source: ATA, Smith Travel Research,
“Airlines in North America are adding a few extra seats this month for the first time since 2007, according to an aviation industry research firm.”
Corporate travel is leading with lower ADR while Leisure travel is seeing higher price increases
Source: Expedia inc. Internal Data
…Encouraging leisure travelers to cut their vacations short…
Source: Expedia stayed data year-to-date (Jan– Aug2010); Excluding Hotwire
YoY Average Length of stay; by stay month
…And spend more time shopping aroundYoY Air Searches
Source: Expedia inc. Internal Data Jan – Aug 2010 (Xlogs)
37% more searches to Cancun
39% more searches to Las Vegas
21% more searches to San Francisco
17% more searches to Orlando
In leisure markets, travelers are booking further ahead
Source: Expedia stayed data year-to-date (Jan– Aug2010); Excluding Hotwire
YoY Growth in Booking Window
Stay Month
For leisure the deal remains “King”…
Source: Expedia inc. Internal Data 7- 2010 (Booked)
Example: Fort Lauderdale Packages70% of packages have at least a 20 % savings
…And promotions make a difference…
Property Grouping Average Promotion Mix YoY Room Nights
Top 5 Winners 80% 103%
All Other 37% -10%
Example: Hotels in Phoenix
…With travelers cautious about their purchases
Source: Expedia inc. Internal Data Q2 2010 (Booked)
Scores 4.0 and higher convert 2X better
Example: Hawaii – Big Island
User Review Score YoY Room Nights
4.0 and Above +39%
Below 4.0 +4%
“87% of travelers found traveler-generated reviews from people they didn’t know influential in deciding where they would purchase their leisure travel”.
(PhoCusWright Inc)
Word of mouth makes a real difference in travel marketplace
Source: Expedia, Inc.; The PhoCusWright Consumer Travel Trends Survey 10th Edition
Low HighTraveler Opinion Score
Impact of traveler reviews on purchase conversion
© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 23
Value of user reviews..
+2 points in a review = +.5 star rating plus moving one mile closer to city center
+1 point in a review = 9% increase in ADR
2x as many people strongly agreed that they took recommendations from total strangers on travel advice websites over and above those made by family and friends (Hotels.com study)
Thanks!
Expedia Partner Services Group | 25© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary.
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