Easier said than done!

Posted on July 19, 2006. Filed under: Travel |

Top Stories & Trends – Study Says Travel Industry Needs to Build Brand Equity

The results of this research show the difficulty for the online travel industry to work itself out of the trap of being preceived as the provider of lowest price airline tickets and hotel accommodation, with all the negatives of what is a typical commodity market where brand loyalty is absent and the suppliers can directly sell to consumers cheaply on their own sites.

Especially the online travel intermediaries have to move towards establishing strong brands and gain online travel buyer trust. This will not be easy due to the aforementioned low price focus, that the industry has brought on itself since the earliest days of online travel. Most online travelers now expect a Neiman-Marcus experience at Wal-Mart prices and that’s just not possible, even in travel….!

To get that point across is critically important for future profitable growth and success. It requires an improved, fully integrated online research/planning and buying experience for complex vacations. Only with this kind of added value services can brand become a decisive factor and brand trust a reality.

Travel is a complex industry, as many technology focused players are finding out, now that the low hanging fruit of just providing an easy to use booking engine for lowest price air fares and single travel components has been picked. Now, the game gets tough, often to the surprise of Wall Street analysts, who expect ever higher growth rates and margins. There seems to be no clear understanding of the leisure travel industry as a complex, integrated market and the challenges this poses, at least in the near term to many intermediaries to maintain a strong position and move up to the next level in the value chain.

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