Travel on The Net - Some basic statistics:

Internet travel has grown at the rate of 300% pa (US $270 million in 1996, US $820 million in 1997) and is expected to reach US $8.9 billion pa by the year 2002. The explosive growth of Internet travel reflects the underlying growth of the Internet, continuing strong growth of travel and the growing relationship between technology and the travel industry. The Internet is an ideal technology for travel. It offers a vast information resource, immediate convenience and interaction that can provide a very personal experience. As the Internet reaches to every house and business, it will find a huge market of travellers looking for information "Just Beyond their Imagination, and only a click away".

However impressive this sounds, it is worth noting that 90% of on-line travel bookings are for air travel, and the total bookings placed through the Internet is now estimated to be less that 2% of the entire travel trade. Airlines are expected to account for as much as 75% of the total bookings by the year 2002, which suggests that the Internet is not going to replace the travel agent. At least not yet.

To a large extent the Internet is a direct channel allowing travelers directly to contact hotels and make bookings via email or on-line. However, our surveys suggest that Barbados.org generates an equal number of bookings through the Travel Agent (TA). In an ongoing survey of VIP users we see that 50% of these visitors prefer to book through their TA. They use the net to shop around and research a property or a destination before talking to their travel agent.

In an ongoing survey we see that 95% of visitors are finding Barbados.org on the Internet, via the search engines and links from the many other sites that now link to Barbados.org. (these include sites like AOL, Realnames, CNN, Travel Portals, Universities and Journalist sites etc). In January 1999 there were 28,000 unique referrers (ISP- Webistes like Yahoo) accounting for visitors to Barbados.org.

Travel Partners on the Net

Travel Agents on the whole have been very slow to adopt the Internet, due to fear, lack of vision, and also because they already have several on-line services like Computer Based Reservation Systems (CBRS) etc. While they have in the past seen little reason to embrace the Internet, that is changing and many are now setting up their own sites.

The bigger TAs, such as Thomas Cook, have their own destinations guides to compete with the on-line guides like World Travel Guide On-line (WTG-On-line) and Worldview etc. Some sites are huge: Travelocity and Preview Travel are enormous with over 20,000,000 hits per month. This is rather telling as Preview, which is now considered to be one of the world leading TAs, did not exist a couple of years ago. But the price of success was not and is not cheap. Preview committed $11 Million US in their initial launch. Expedia, Microsoft's own TA is said to be still losing money.

I have spoken to several of the big Internet Travel Booking sites and while they don't like to reveal statistics it is clear that sales of hotel rooms and destinations services is disappointing to them. Airline seat sales on the other hand is booming.

Airlines:

It is useful to speculate why Airlines are doing so well:

Internet is used in an intelligent way, providing a level of interaction and consolidation that is not otherwise readily available. Anyone can for example, ask for the best fares between destinations for a specified period and get an immediate reply of availability and price. One can also receive email notifications of fares between cites on a regular basis.

Last minute deals and seat sales give high value to the user and are sometimes only available on the Internet

Airlines seats, unlike hotel rooms or destination services are a commodity. There is no need to see the seat or talk to someone about the service. The decision to purchase is simple and requires no consultation.

Airlines are perceived as reliable entities to do business with. This is not so with an unknown Hotel website or Internet Agent.

Conclusions and lessons for Barbados.org:

Barbados.org is a significant and rapidly growing marketing and communications media. Hits on Barbados.org have grown 300% over the last year. It had 3,400,000 hits in January 1999 representing 59,000 users sessions per 24 hours. 28,000 websites referred visitors to Barbados.org

The Internet is media, and we need to formalise a strategy for Internet promotion. 95% of Barbados.org visitors are finding about Barbados and the website from the Internet.

The TA is still a vital market partner. 50% Barbados.org users surveyed will use a travel agent.

Barbados.org appears to be doing better than the industry standard for on-line bookings. We receive over 6000 emails requesting reservations and services on a monthly basis. 10% of hotel enquiries are booked directly and an equal number appear to be booked through TAs after first viewing the property on Barbados.org. Accordingly we estimate that Barbados.org is generating well over 2% of Barbados travel business, but we need more analysis to be sure of the exact figures.

While our rate of conversion from enquiries to bookings is low, it appears to be above average. We feel that this can be improved and this will be a priority in the future.

Value: We may need to give visitors incentives and services available only through the Barbados.org. We need to Give agents information and assist them in the sale. (more on this later).

Reliability. Barbados.org continues to get asked for opinions about hotels and services. We are seen as reliable. We should increase our involvement with visitors by way of emails and other services (more on this later).

Differentiate. Barbados is not a commodity. It is much more than Caribbean sea, sand and sun. We will continue to demonstrate Value through information, technology and marketing. We will continue to define and demonstrate the unique "Barbados Experience".

OUR NEXT ISSUE WILL ADDRESS INTERNET ADVERTISING AND THE INTERNET AS MEDIA.