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Lessons from Online Travel during the Downturn by Tracey Weber, President, Travelocity North America
Online travel companies started 2009 with great uncertainty. Would consumers continue to spend on travel? It’s a discretionary category, but it’s also one that can be very important for people: It can enable consumers to stay close to family and friends, enable them to experience new cultures, even enable them to help the world. Well, 2009 proved that consumers do indeed view travel as an important category–and one they still wanted to spend their hard-earned dollars on. But that came as travel suppliers greatly reduced their pricing to stimulate demand. This is particularly true for hotels, which discounted their rates by unprecedented amounts – for certain destinations, seasons, and days of week, you could find rates more than 50% cheaper than the prior year.
At Travelocity, we had to become a better retailer and not just an online shopping engine. Although the deals on travel were better than ever, most consumers were overwhelmed when it came to finding the best ones. When should I buy? What should I buy? It was critical for us to develop new tools that would help retail travel better and help consumers find the best deals. We created “Deals Wizard,” an easy-to-use visual tool to help consumers sort through deals to multiple destinations across a broad range of time. We also launched “Deals on a Map,” which enabled users to compare prices across destinations by looking at a map. We also expanded our “Good Day to Buy” email, which alerts customers when air fares and hotel rates have dropped by 20% or more, to include more destinations and more types of products. And lastly, we had to get creative with our retail messaging both in traditional advertising channels as well as in new channels like social media and mobile. During the summer time, we had an integrated campaign called “Summer of Possibilities” during which people could vote on where Travelocity Roaming Gnome would travel and then engage with him in that location.
A down economy presents many challenges for companies, regardless of industry. In particular, leaders need to help their organizations balance innovation and operational excellence. In the case of travel, we had to innovate to become better retailers – getting deals out so consumers kept traveling and purchasing with us. However, it was also critical that we manage our operations as perfectly as ever – there was less room for error on key processes that affect customer satisfaction (for example, call center wait times) and less room for error on costs. The “glass half full” view of the downturn is that it stretches your organization and your leadership team and in the process can show strengths you were not aware of and uncover areas of weakness that need to be shored up. We’re looking forward to continued recovery in the economy for 2010–but move forward having learned some useful lessons in 2009.
