Will the media ever get it? Part 2

Posted on April 29, 2006. Filed under: Uncategorized |

Here is a useful review of Travelocity’s site and the customer service they offer, which the writer considers superior to what’s offered on other travel sites. Why then, does she not understand that Travelocity can’t at the same time offer a lowest price guarantee?

Superior customer service has a cost and in the thin margin business of online travel it has to be paid for by someone. That someone, as in any other business,is the customer who in return gets a better product or service.

For some strange reason this simple economic fact seems to consistently escape the media covering the online travel industry. Every site is expected to offer the absolute lowest price. Not possible!

No serious journalist would expect that to be the case in other industries. Can you imagine an article praising the service and product choice of Neiman-Marcus but then complaining that the prices are higher than a Wal-Mart? OK, so why this constant complaint in online travel? It’s just beyond me.

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One Response to “Will the media ever get it? Part 2”

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Great point! You’re going to compete on one of three things: quality product, low price, or superior service. You can’t compete on low price AND superior service together. The economics don’t work! Good post.


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