Categorisation of online travel sites used to be easy. Either a site was transactional or non-transactional.
Either it made its money negotiating with suppliers for inventory and charging customer credit cards or it made its money from advertising and clicks through funnelling consumers from one place to the other.
In my post "Meta-search vs Online Travel Agents: the three main differences and why they matter" I mentioned that one of the major differences between an OTA (transaction site) and a meta-search site (non-transaction site) is that the transactional sites try to build up a unique product set - inventory (or inventory combinations) that no one else has - whereas the non-transactional meta-search company is focused on pointing to product that by definition is not unique as it is maintained by someone else.
A clear distinction that made it easier for customers and companies within the industry to know who was doing what and (in the case of companies) how to operate together.
However in late 2009 the distinction between the two categories began falling apart with non-transactional sites building unique product offerings.
Here are six theoretically non-transactional sites now operating unique product models.
Kayak Private Sale
Dennis Schaal over at Tnooz has been doing a great job tracking the ins and outs of the launch of Kayak Private Sale - efforts by the #1 meta-search company Kayak to launch exclusively negotiated deals. My own thoughts on the program are in this post "zero percenter no more".
TripAdvisor
In Jan 2010, TripAdvisor announced the launch of TripAdvisor Busness Listings. Under this model TA will charge properties $600 or more to add direct to property contact details (email, URL, phone) with the aim of driving direct to property sales rather and sales through third party advertisers. TripAdvisor have not said it yet but I think it is only a matter of time before they start carrying rates and specials.
Voyageprive and Jetsetter
Guillaume Thevenot of Hotel Blogs let me know about a French company VoyagePrive. Now operating in a number of countries, VP is a referral only travel "club" that points members in the direction of deals only available on VP. To get into the club you have to be invited by a member. Then VP will send out to the members deals that have be privately sourced from suppliers. Deals open for only 72 hours.
Jetsetter ia a similar model. Created by former Kayak VP Drew Patterson, Jetsetter has also taken the referral-only club with limited time period deal approach. More on them at the Tnooz story here.
DealBase
I first came across DealBase at the 2008 PhoCusWright Travel Innovator Summit (my post on Dealbase and demo presentation here).
One of my picks for the top six at that conference. Hotels directly load deals onto DealBase which are then checked by the DealBase team for quality of the deal. The deals are coming from the supplier but the checking is being done by the distributor which DealBase hope will result in unique product.
TotalTravel
Australian based TotalTravel (now owned by Yahoo7 - JV in Australia between Yahoo! and a TV network) started as an accommodation listing site (using the TripAdvisor Business Listing model years before TA launched it). Hotels in targeted destinations would get a base listing for free with paid upgrades for placement and promotion. Those enhanced placement options include the ability to promote specific (and at times unique) deals to the TotalTravel.
The blurring of the clear distinction between the companies that sell and that companies that help the companies that sell has important consequences for the industry.
As I mentioned here the OTAs have built up their unique product capabilities behind an expensive infrastructure of supplier management, merchandising and customer care teams.
The non-transactions sites are trying to replicate the unique product set without the costs. I don't think they can replicate the same deal potential without the cost.
Finding a good deal is hard (time consuming and costly). Targeting it at the right consumers is even harder (more time, a little less costly).
If they can - and I doubt it - then it will push the OTAs to also rethink their models and costs. Causing a true industry revolution.
Categorisation of online travel sites used to be easy. Either a site was transactional or non-transactional.
Either it made its money negotiating with suppliers for inventory and charging customer credit cards or it made its money from advertising and clicks through funnelling consumers from one place to the other.
In a post Meta-search vs Online Travel Agents: The Three Main Differences and Why They Matter, I mentioned that one of the major differences between an OTA (transaction site) and a meta-search site (non-transaction site) is that the transactional sites try to build up a unique product set - inventory (or inventory combinations) that no one else has - whereas the non-transactional meta-search company is focused on pointing to product that by definition is not unique as it is maintained by someone else.
A clear distinction that made it easier for customers and companies within the industry to know who was doing what and (in the case of companies) how to operate together.
However in late-2009 the distinction between the two categories began falling apart with non-transactional sites building unique product offerings.
Here are six theoretically non-transactional sites now operating unique product models.
Kayak Private Sale
TripAdvisor- In November 2009, TripAdvisor announced the launch of TripAdvisor Busness Listings. Under this model TA will charge properties $600 or more to add direct to property contact details (email, URL, phone) with the aim of driving direct to property sales rather and sales through third party advertisers. TripAdvisor have not said it yet but I think it is only a matter of time before they start carrying rates and specials.
Voyageprive and Jetsetter- Hotel Blogs recently let me know about a French company VoyagePrive. Now operating in a number of countries, VP is a referral only travel "club" that points members in the direction of deals only available on VP. To get into the club you have to be invited by a member. Then VP will send out to the members deals that have be privately sourced from suppliers. Deals open for only 72 hours.
- Jetsetter is a similar model. Created by former Kayak VP Drew Patterson, Jetsetter has also taken the referral-only club with limited time period deal approach. More about in previous Tnooz articles.
DealBase- I first came across DealBase at the PhoCusWright Travel Innovator Summit in 2008 (Dealbase and demo presentation) and was one of my picks for the top six at that conference. Hotels directly load deals onto DealBase which are in turn then checked by the DealBase team for quality of the deal. The deals are coming from the supplier but the checking is being done by the distributor which DealBase hope will result in unique product.
TotalTravel- Australian based TotalTravel (now owned by Yahoo7 - a JV in Australia between Yahoo! and a TV network) started as an accommodation listing site (using the TripAdvisor Business Listing model years before TA launched it). Hotels in targeted destinations would get a base listing for free with paid upgrades for placement and promotion. Those enhanced placement options include the ability to promote specific (and at times unique) deals to the TotalTravel system.
The blurring of the clear distinction between the companies that sell and that companies that help the companies that sell has important consequences for the industry.
As previously mentioned, the OTAs have built up their unique product capabilities behind an expensive infrastructure of supplier management, merchandising and customer care teams.
The non-transactions sites are trying to replicate the unique product set without the costs. I don't think they can replicate the same deal potential without the cost.
Finding a good deal is hard (time consuming and costly). Targeting it at the right consumers is even harder (more time, a little less costly).
If they can - and I doubt it - then it will push the OTAs to also rethink their models and costs - causing a true industry revolution.