Bigmouthmedia Online Travel Report 2010

Our 2010 Travel Report has revealed that travel companies are set to move the majority of their marketing spend into online advertising in 2010. Compiled from an extensive survey of 39 travel clients and 109 users of tnooz.com, the research reveals that companies intend to increase the proportion of their marketing budgets being spent online, with the 50% share allocated to digital channels in 2009 set to rise to 57% in 2010. As the industry responds to unprecedented economic pressure, a clear majority also intend to significantly increase spending on social media over the next year. So it’s official, the majority of spend is put towards online, as travel companies have come to appreciate the power and reach of digital marketing. The share of spend towards online has rocketed from only 38% in 2008. This figure differs by sub-vertical and the full figure below illustrates that the traditional travel companies i.e. airlines, hotel suppliers, ferry etc are spending less on online and OTAs and travel comparison engines are spending the vast majority of budgets online.

While paid search retained the highest portion of online budgets with an average of 37% in 2009, followed by search engine optimisation at 18% and display at 17%, indications for the next year suggest that this pattern is set to change. While overall PPC spend is likely to grow, some 60% said they would either maintain or decrease pay-per-click spending over the next 12 months, instead focusing their efforts on a blend of SEO of Online PR. While only 7% of online marketing spend was devoted to social media in 2010, 60% of the travel companies responding said they would be increasing their social media and search engine optimisation budgets next year. Interestingly, however, almost half said that they saw engaging with social media as one of the biggest challenges facing the industry in 2010.

As a clear majority of firms indicating that they see engaging with social media as a major challenge, it seems that many in the industry are struggling to develop effective strategies for these emerging channels. Doing social media badly is worse than not doing any social media at all, so next year’s big challenge will be for travel companies to work out strategies for engaging in social media.

According to the survey, the biggest online marketing opportunity awaiting travel companies in the year ahead are the savings and benefits to be had from driving synergies between the full range of online channels.

While many of the travel companies surveyed said that the economic climate was the greatest challenge facing the industry, today's difficult financial circumstances have played a major part in driving change. Digital marketing's transparency and measurable ROI makes it an extremely attractive option to companies that need to ensure every penny of their spend is both justifiable and worthwhile.

The bigmouthmedia 2010 Travel Report can be downloaded at: http://www.bigmouthmedia.com/live/articles/online-travel-report-2009.asp

Winner 'Best use of SEO' - Travolution Awards

Last night we won The Travolution Awards in the category ‘Best use of SEO’ for our campaign with Kuoni Travel.

Kuoni is the leading luxury tour operator in the UK, they have been voted “World’s Leading Tour Operator” at the World Travel Awards eleven times in a row.

The challenge was to implement an innovative SEO strategy that enhanced their brand online as well as delivered excellent results.

Key strategies:
- i-Travel – an innovative travel resource that enhances internal linking and act as link bait
- Searcher Profiles – understanding Kuoni’s demographic profile (Social Climber, Post Modern and Upper Liberal) and what differs when they research and book travel online
- Destination Strategy – making sure we optimized each destination ahead of the search spikes that occur due to seasonality
- Tiered Keyword Strategy – by categorizing and prioritizing our ‘KPI’ keywords we made sure we had the right focus throughout the campaign
- Universal Search – proliferating videos which gained universal search listings for generic and brand keywords
- Creation of YouTube Channel
- Extensive External Optimization including Social Media Releases – using online press releases with embedded videos
- PPC & SEO Synergy – aligning both channels, utilizing synergy to maximize results

The results:
- Increase in #1 rankings for Tier 1 keywords by 100%
- Organic traffic increase of 104%
- Organic share of visits increased from 37.95% in Sep 08 to 46.98% in May 09
- Organic share of visits increased by 24%
- Excellent ROI

Kuoni.co.uk received 64.6% more organic traffic in May 2009 than total search engine traffic in May 2008.

The awards process was a bit unusual, in addition to the standard written entry we had to pitch to a panel of judges.

The Travolution judges comments: “A fantastic demonstration of when SEO and user experience work hand-in-hand to create a powerful new proposition, especially with Kuoni’s new i-Travel proposition. The agency met all the client’s objectives and produced premium results with a clear return-of-investment.”

Still tough time for airlines – SkyEurope filed for bankruptcy

Sky Europe Airlines AS suspended its operations and now filed for bankruptcy. The website is advising passengers that paid for flights with credit cards to seek refund from the customers own bank, they are also stating otherwise no refunds might not be available. Sky Airlines obtained credit protection in Slovakia in June. They made a loss of $85.63 million last year.

It’s still a tough trading climate for the airlines, and IATA has warned that the airline industry remains in “intensive care” despite a slight recent improvement in monthly results for international scheduled traffic.

In July demand was down by 2.9% year on year; an improvement from -7.2% in June and -6.8% over the first seven months of the year. European and North American carriers saw declines of -3.1% and -3.2% in July.

Load factors are similar to those recorded in July 2008, capacity was more in line with reduced demand than in previous months, but this came at the expense of yields which continue to fall. Passengers are choosing cheaper fares, but airlines have also been leaving cheaper fares open for sale closer to departures dates as they are trying to get rid of excess capacity and increased competition. The July increase in travel demand is a result of cheaper fares than consumer confidence in the economy.

The only positive news were from the Middle East where carriers were the only ones to grow in July. The 13.2% growth in July was slightly better than the 12.9% recorded in June. The growth is due to increased capacity and greater market share in traffic between Europe and Asia. Also the luxury hotels in Dubai are doing well. According to Dubai Tourism and Commerce Marketing (DTCM) five-star beach hotels achieved an average 97% occupancy rate during the second week of August. Dubai has received 3.9 million international visitors in the first six months of the year, a 5% increase on the first six months of 2008.

The problems for the airline industry remain severe, despite the demand looking slightly better during the peak season June through to August. But this is when the airlines need to make their money. Unfortunately the bottom line for airlines has not improved. Load factores are high but revenues are down. The recent failure of SkyEurope is a sign of that.

Hitwise top 50 shows travel winners and losers

Thomas Cook and First Choice were among the biggest climbers in the latest Hot Shops List.

Based on online traffic figures in July, Thomas Cook moved up 14 positions to 16, while First Choice climbed 13 spots to 37. Thomson and Easyjet joined the top 10 for the first time. Hitwise warned that traffic to travel websites is declining overall, "Most of the travel companies moved up the rankings this quarter, but this seasonal increase masks an annual decline in traffic to most of the sites. “The notable exception was The Train line, which is benefiting from the boom in domestic travel and 'staycations'.” Across the pound the US top 50 sites for the same time period by Comscore only included one travel site Expedia ranked 28th.

Top Ranking Travel Sites – Hitwise Top 50 UK
• 8 - Thomson Holidays
• 9 - Expedia.co.uk
• 10 - easyJet
• 12 - Ryanair
• 15 - lastminute.com
• 16 - Thomas Cook
• 31 - TravelRepublic.co.uk
• 34 - The TrainLine
• 35 - British Airways
• 37 - First Choice
• 44 - Travelodge UK

Marriott’s great use of Twitter in a crisis

Terror attacks targeting luxury hotels in Jakarta is today’s headlines. The recent explosion at the Ritz-Carton killed at least 9 people and the police have found an unexploded bomb in a room of the nearby Marriott hotel. The bomb was found and defused as police searched the luxury hotel following the bombing in its basement, which killed seven people earlier in the morning.

Marritot have been twittering about the incident, and I think it’s a great example of how useful Twitter can be as a tool to instantly interact with the public.

Marriott sent the first tweet about 6 hours ago ‘To all who have tweeted, we are gathering info and will have more as we learn details from Jakarta.’ Thereafter subsequent tweets have provided useful information, support to the victims and their families as well as phone numbers and an update once everyone had been evacuated and the area secured.

Air France have also tweeted the Progress Report from the French Air Accident Investigation Bureau for the crash involving Air France flight 447 from Rio de Janeiro to Paris-Charles de Gaulle.

Travel Superbrands

Superbrands UK revealed today the list of top 500 consumer brands as chosen by a panel of experts and more than 2,000 UK consumers. The survey defines a Superbrand as having established "the finest reputation in its field". The big surprise was Microsoft kicking Google off the top position.

Last year 21 travel brands made it into the top 500 Superbrands, this year 17 made it. A mere 3.5% of the total list are travel clients. Apparently is an “achievement in itself” to make the list of top UK Superbrands, and needless to say many large travel brand failed to make the top 500 list. In fact Superbrand's methodology is pretty controversial and Kevin May at Travolution has written an excellent post about the confusion over the Superbrands list.

British Airways was the only travel company in the top 10 brands; they managed to climb one position this year to number 4.

The travel companies that fell off the list were: Qantas, Virgin Trains, Centre Parcs, Cathay Pacific, Eurotunnel, Expedia, Lufthansa and Lastminute.com

The new travel entries were: P&O Ferries, Royal Caribbean International, Radisson Hotels & Resorts and Holiday Inn.

The travel brands that showed the strongest year-on-year improvement were Cunard “the most famous ocean liners in the world’ up 136 places, Virgin Atlantic up 59 places, National Express up 52 places and Thomas Cook up 46 places.

The highest new entry into this year's list was P&O Ferries in position 176, indicating brand kudos for relatively low cost travel alternative in the downturn.

Year-on-Year Comparison Table below for Travel Superbrands