Yahoo! promoting FareChase
Brian Smith wrote an excellent post for SearchEngineWatch that lays out the expanded exposure of FareChase and latest features, as well as providing a nice OTA vs. TSE comparison.
I too think of OTAs as travel 1.0 and travel search engines as travel 2.0. By the way, I had a discussion on this very topic recently with a founding member of the Expedia team. He was sharing the initial elevator pitch for Expedia which now sounds eerily similar to the pitch of TSEs...
Today, OTAs look more and more like offline travel agencies - call centers, service fees, high-merchandising and total trip focus. They once were about empowering the do-it-yourself travelers with tools and information to buy ala carte travel components (air, hotel, etc.). Now, that sounds like the positioning of TSEs. Better tools (sorting, filtering functionality) and information to enable users to find the best fares/rates to book direct for the best value (and avoid fees -- as OTAs helped users avoid fees from offline agents at one time). The TSE trend is clearly gaining momentum as consumers become more aware of the benefits of booking with suppliers. Beyond low fare guarantees, bonus miles and no booking fees, it's easier to make changes to your ticket, upgrade your seat, and access exclusive airline site promotions when booking direct.
Now for the moves by Yahoo! to promote FareChase. I believe it makes a significant statement to the market that Yahoo! is willing to risk future Travelocity revenue share and OTA search spend to move FareChase and travel search to the forefront. It makes sense that Google (referring users to OTAs via shopping assistant model), AOL, and others have treaded lightly as the OTAs represent significant keyword search spend/revenue. If FareChase is successful, look for AOL (Pinpoint/Kayak), MSN, and Google to respond with more aggressive moves to align themselves with TSEs.
I too think of OTAs as travel 1.0 and travel search engines as travel 2.0. By the way, I had a discussion on this very topic recently with a founding member of the Expedia team. He was sharing the initial elevator pitch for Expedia which now sounds eerily similar to the pitch of TSEs...
Today, OTAs look more and more like offline travel agencies - call centers, service fees, high-merchandising and total trip focus. They once were about empowering the do-it-yourself travelers with tools and information to buy ala carte travel components (air, hotel, etc.). Now, that sounds like the positioning of TSEs. Better tools (sorting, filtering functionality) and information to enable users to find the best fares/rates to book direct for the best value (and avoid fees -- as OTAs helped users avoid fees from offline agents at one time). The TSE trend is clearly gaining momentum as consumers become more aware of the benefits of booking with suppliers. Beyond low fare guarantees, bonus miles and no booking fees, it's easier to make changes to your ticket, upgrade your seat, and access exclusive airline site promotions when booking direct.
Now for the moves by Yahoo! to promote FareChase. I believe it makes a significant statement to the market that Yahoo! is willing to risk future Travelocity revenue share and OTA search spend to move FareChase and travel search to the forefront. It makes sense that Google (referring users to OTAs via shopping assistant model), AOL, and others have treaded lightly as the OTAs represent significant keyword search spend/revenue. If FareChase is successful, look for AOL (Pinpoint/Kayak), MSN, and Google to respond with more aggressive moves to align themselves with TSEs.
posted by Mike Fridgen at 8:27 PM
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