What demographic uses UGC and social networking in travel

February 13, 2009

In contrast, when it comes to social networking sites, like Facebook and MySpace, there is a definite discrepancy in the age of regular users.  EyeforTravel found that 70% of the 18-34 age group have used social networking sites in the last 30 days, compared to only with 35% of 35-49 year olds and 12% of 50-64 year olds. 

So why do the over 35’s feel more comfortable reading user reviews over participating social networks?  Firstly, travel-specific user-generated content sites, like TripAdvisor, are easy to use and very accessible.  The search functions are clear and quickly give people access to vast amounts of specific, relevant content.  This is not the case for social networks. 

Secondly, travel-specific UGC sites rarely require people to log-on or leave personal details, something which older people may see as an obstacle.  Reading user-generated content is more passive and less personally intrusive compared to actively participating in online social networks. 

Lastly, compared to social networks, the benefits of UGC sites are obvious.  For the over 35 age group, who are reading online hotel reviews, they can immediately see the opportunity to save money, avoid making bad decisions and get demographically suitable advice.  The benefits of social networking sites on the other hand, are not so clear.  The over 35 year age group tends to have more money to spend so it makes sense for them read customer feedback before making large purchases, such as travel.

On the other hand, there is a distinct portion of over 35’s who are perfectly poised to take advantage of the social networking phenomena; The Business Traveler.  This group tends to have greater connectivity and has access to state-of-art handsets and laptops.  Plus, they tend to spend more of their time online.  They are also more likely to accept impartial advice from fellow business travelers with the same requirements.  After all, you don’t need to be someone’s “friend” to get advice on traversing Chicago O’Hare on a Friday night. 

There is great potential for the business traveler to use social media to increase efficiency, access business-specific information, such as suitable restaurants for clients, and get updates on delays and adverse weather conditions.  Social networking sites TripIt and LinkedIn have recently made moves to exploit this opportunity.  The TripIt application on LinkedIn allows users to notify potential clients of upcoming trips. 

“TripIt was selected by LinkedIn as their travel application precisely because an older more professional audience is using social networking tools like LinkedIn and TripIt. The focus of these second-generation tools is on providing social utility and mobile convenience that provide information when and where people need it,” commented Gregg Brockway, TripIt Co-founder. Gregg Brockway and LinkedIn’s Lucian Beebe will be speaking about how business travelers can productively use social travel services at work at EyeforTravel’s Social Media Strategies for Travel Conference on March 10-11 in San Francisco.  They will explain which types of content, advertising and applications appeal to, and directly benefit, the business traveler. 

P&G Digital Guru Not Sure Marketers Belong on Facebook

Advertisers Shouldn't 'Hijack' Conversations, but Applications Hold Promise

Published: November 17, 2008

CINCINNATI (AdAge.com) -- Social networks may never find the ad dollars they're hunting for because they don't really have a right to them, said Ted McConnell, general manager-interactive marketing and innovation at Procter & Gamble Co., at a Nov. 15 forum on digital media.

In a talk to the Digital Non-Conference, a program by Cincinnati's Digital Hub Initiative presented by the Ad Club of Cincinnati and attended by about 190 people, Mr. McConnell pointed to the drumbeat of complaints about social networks being unable to monetize their sites.

"I have a reaction to that as a consumer advocate and an advertiser," he said. "What in heaven's name made you think you could monetize the real estate in which somebody is breaking up with their girlfriend?"

'Who said this is media?'
He went on to apply a similar standard to the broader world of consumer-generated media. "I think when we call it 'consumer-generated media,' we're being predatory," he said. "Who said this is media? Media is something you can buy and sell. Media contains inventory. Media contains blank spaces. Consumers weren't trying to generate media. They were trying to talk to somebody. So it just seems a bit arrogant. ... We hijack their own conversations, their own thoughts and feelings, and try to monetize it."

While it's not a company policy, but rather a personal preference, Mr. McConnell said, "I really don't want to buy any more banner ads on Facebook."

That's not to say he believes P&G should end all involvement with Facebook. He cited Facebook applications as a potentially valuable vehicle for advertisers, one in which they can create an environment that's favorable for their brands and consumers alike.

Uncomfortable about targeting
But while he appreciates the power of targeting afforded by Facebook, Mr. McConnell said, it also makes him uncomfortable.

He said a subordinate of his did an experiment in which he set out to use Facebook to find a 22- to 27-year-old female P&G employee living in Cincinnati "who likes sex and Cocoa Puffs -- that was literally the target ID he asked for Facebook to find." And he found such a person.

"So the targeting is fantastic," Mr. McConnell said. "You can do really amazing things. But I'm not so sure I want to be targeted like that. ... I don't think everything every consumer says to someone else and writes down is somehow monetizable by the media industry."

Inventory explosion
More broadly, Mr. McConnell said he believes marketer dollars will continue to flow online, but that won't necessarily be a boon to online publishers, because online display inventory continues to grow faster than the dollars going after it.

He cited research by Morgan Stanley showing cost-per-thousand rates on banner ads falling from $3 to $1 on average during this decade. And despite rapid growth of internet audiences in markets such as Brazil and China, he said, advertisers are able to pay CPMs of about 5 cents because of the even more rapid explosion of inventory there.

"Fragmentation thwarts artificial scarcity," he said, noting that CPMs for rich media have held up somewhat better. Search CPMs are growing largely because of Google's quality-scoring system, he said.

Despite the growth of online classified-advertising alternatives, Mr. McConnell said, classified revenue for offline publishers continues to dwarf online classified spending, leaving plenty of remaining revenue for newspapers and room for growth for online alternatives.

But the divergence of fortune for pay-per-click and other performance-based models vs. CPM-based models will only intensify as the economy worsens, Mr. McConnell predicted. "'Spray and pray' is a little harder to do when you're under economic pressure," he said. "So performance-based advertising will gain share over CPM."

Boutique segment a distinctive set

STR - 11.17.08

 

Whatever adjective you choose to use—hip, alternative, fresh or unique—boutique hotels are a distinctive and interesting group of hotels to analyze.

While the definition of a boutique hotel can vary widely, most agree that product offerings/assets in this space offer and promote a distinctive, urban/metro, contemporary and avant-garde feel. Disagreements about the definition of “boutique hotel” probably exist among both hoteliers and consumers, stemming from personal taste in FF&E packages (décor), atmosphere and architecture, both exterior and interior.

At STR, we objectively define hotels in the segment as having an actual or estimated room rate (ADR) of $175 or higher and a room count of 150 to 300 rooms. We also include major players in the boutique segment such as: Morgans Hotel Group (previously Ian Schrager Hotels), Kimpton Hotels, Joie de Vivre, Starwood’s W Hotels, recent product offerings from InterContinental Hotels Group’s Hotel Indigo brand, John Russell’s NYLO brand, Starwood’s Aloft and a number of independents that meet the definitional and objective criteria for the segment.

The boutique hotel segment is a collection of approximately 450 properties and 55,650 rooms accounting for less than 1.5 percent of all rooms available for rent in the United States. Growing in popularity and becoming a hip alternative place to stay for business and leisure travelers alike, the segment experienced notable supply growth in excess of 5.0 percent, starting in the late ‘90s and peaking at just over 7.0 percent before 9/11 and the resulting industry downturn. Currently, the 3.8-percent growth in room inventory outpaces the national average of 2.3 percent for the 12 months ending September 2008.

 

A tough operating environment has reduced demand for rooms 0.2 percent nationally while demand growth for boutique properties has grown by 2.5 percent in the latest 12-month period ending September 2008. Despite favorable levels of demand for the segment, the aforementioned 3.8 percent growth in supply yields a 70.6 percent absolute level of occupancy, which is a decline of 1.2 percent from a year ago.

Soft demand/occupancy in this current downturn has, in turn, affected rates. While the industry at large increased rates at just over 4.0 percent, hotels in the boutique segment were able to raise rates by 5.5 percent in the 12-month period ending September 2008.  However, this level of growth was markedly off from the 10.0 percent to 11.0 percent level enjoyed by the segment in both 2006 and most of 2007. The US$130 premium in ADR commanded by boutiques is certainly noteworthy and can be attributed to the distribution and density of product in major metro markets.

 

Revenue per available room growth of 4.2 percent came from the heavy contribution of the 5.5-percent growth in ADR and the 1.2-percent decline in occupancy. More importantly, RevPAR growth for the segment outpaced the national average of 1.7 percent. Similar to the ADR premium enjoyed over industry average, boutiques posted a US$100 premium in the absolute level of RevPAR for the 12 months ending September 2008.

 

 

If we look beyond this hopefully short downturn and into the future, the boutique segment appears poised to post favorable levels of performance and continue to be a viable option to the traditional hotel room and stay. New entrants into the competitive landscape like Aloft, Indigo, NYLO, and Edition—the Marriott/Ian Schrager partnership—will certainly shape this dynamic segment for years to come. Retiring baby boomers, Gen Xers, emerging Gen Yers and those consumers looking to escape big brands will certainly seek alternative, hip and unique surroundings, experiences and aspirations perhaps only a boutique hotel can offer. 

How Much Will Online Travel Slow? 

Nov. 13, 2008 - Online travel bookings will total $98.2 billion in 2008, up just 9% over 2007, according to PhoCusWright. The company said that some online travel providers would fare better than others, with rail sales growing by 28%, while hotel bookings would rise only 8%.

If the numbers prove true, this will be the first year of mere single-digit growth for US online leisure/unmanaged business travel. However, online growth will still be twice as high as that of the total travel market.

PhoCusWright said that reasons for online’s continued success included consumer comfort with online purchasing, perception of the Web as having the lowest prices and supplier disincentives for booking through other channels. The company also said sales from leisure/unmanaged business travel sites will represent 36% of the total market in 2008, up from 34% in 2007.

eMarketer’s most recent online travel sales estimates for the US were created in August 2008, in the midst of the economic slowdown but prior to the financial industry crisis. At the time, online leisure and unmanaged business travel sales (including airline, hotel, rental car, vacation package, intercity rail and cruise) were predicted to grow 12% this year to reach $105.1 billion.

Jeffrey Grau, senior analyst at eMarketer, said that if the market were being assessed today, the estimate would be lower and more in line with PhoCusWright’s.

Online Ad Clicker Demographics

OCTOBER 22, 2008

Different ad types appeal to different users.

Age, income and visit frequency are closely related to US Internet users’ likelihood to click on ads, according to an August 2008 study by iPerceptions.

Four out of 10 US Internet users surveyed who were likely to click on any type of online ad made less than $50,000 per year, and and only 15% made over $150,000. Video ads drew even more respondents with lower incomes: 49% of those likely to click on video ads made less than $50,000 per year and only 13% made over $150,000.

Although likely clickers of text and banner ads were generally evenly distributed by age, dropping off sharply only after age 64, likely video ad clickers skewed especially young.

Nearly two-thirds of Internet users likely to click on online ads were weekly or daily visitors to the Website where the ad appeared; only 15% were first-time visitors and 6% went to the site sporadically.

It is no surprise that younger Internet users are more likely to click video ads, since they are far heavier online video consumers than those who are older—and far heavier Internet users overall.

A January 2008 study conducted for the Television Bureau of Advertising by Nielsen Media Research confirmed this trend yet again.

As for income, ad exposure and consumption by the wealthy are typically a mixed bag.

“Consumers with higher incomes are targeted for more ads, but they also use more tools to avoid ads such as DVRs and ad-blocking software,” said David Hallerman, senior analyst at eMarketer. 

75 Percent of U.S. Internet Audience Watched Online Video in July

comScore released its July 2008 data from the comScore Video Metrix service, reporting that Americans viewed more than 11.4 billion videos for a total duration of 558 million hours during the month.

Google Sites Maintains Dominant Position - In July, Google Sites once again ranked as the top U.S. video property with more than 5 billion videos viewed (representing a 44 percent share of the online video market), with YouTube.com accounting for more than 98 percent of all videos viewed at the property. Fox Interactive Media ranked second with 446 million videos (3.9 percent), followed by Microsoft Sites with 282 million (2.5 percent) and Yahoo! Sites with 269 million (2.4 percent). Hulu ranked eighth with 119 million videos, representing 1 percent of all videos viewed.

Top U.S. Online Video Properties* by Videos Viewed July 2008 Total U.S. – Home/Work/University Locations
Property	Videos (000)	Share (%) of Videos
Total Internet	11,425,890	100.0
Google Sites	5,044,053	44.1
Fox Interactive Media	445,682	3.9
Microsoft Sites	282,748	2.5
Yahoo! Sites	269,452	2.4
Viacom Digital	246,413	2.2
Disney Online	186,700	1.6
Turner Network	171,065	1.5
Hulu	119,357	1.0
AOL LLC	95,106	0.8
CBS Corporation	69,316	0.6

*Rankings based on video content sites; excludes video server networks. Online video includes both streaming and progressive download video.

More than 142 million U.S. Internet users watched an average of 80 videos per viewer in July. Google Sites also attracted the most viewers (92.1 million), who watched an average of 55 videos per person. Fox Interactive attracted the second most viewers (54.9 million), followed by Yahoo! Sites (37.6 million) and Microsoft Sites (32.6 million).

Top U.S. Online Video Properties* by Unique Viewers July 2008 Total U.S. – Home/Work/University Locations
Property	Unique Viewers (000)	Average Videos per Viewer
Total Internet	142,507	80.2
Google Sites	92,130	54.7
Fox Interactive Media	54,845	8.1
Yahoo! Sites	37,610	7.2
Microsoft Sites	32,640	8.7
AOL LLC	22,959	4.1
Viacom Digital	21,142	11.7
Turner Network	18,666	9.2
Disney Online	15,899	11.7
Time Warner - Excl. AOL	15,345	3.2
Amazon Sites	11,690	2.5

*Rankings based on video content sites; excludes video server networks. Online video includes both streaming and progressive download video.

Other notable findings from July 2008 include:

• 75 percent of the total U.S. Internet audience viewed online video.
• Americans spent a total of 558 million hours watching online video during the month.
• The average online video viewer watched 235 minutes of video.
• 91 million viewers watched 5 billion videos on YouTube.com (54.8 videos per viewer).
• 51.4 million viewers watched 400 million videos on MySpace.com (7.8 videos per viewer).
• The duration of the average online video was 2.9 minutes.

Package holidays close to extinction as more travel companies merge

Last updated at 17:52pm on 19.03.07

As the era of the package holiday comes to a close, tour operator First Choice is merging with German company Tui

The traditional 'sun, sea and sand' package holiday faces extinction with a disastrous fall in sales that has forced Britain's tour operators to merge or die.

First Choice is being taken over by Thomson, which is owned by TUI of Germany, it was revealed today.

Separately, the German-owned Thomas Cook is in the throes of merging with MyTravel, which is based in North West England.

The mergers will see the loss of hundreds of jobs and travel agent shops from high street as more people book their holidays via the internet or Teletext.

The consolidation of Britain's package holiday giants from four to just two comes amid a 14 per cent slump in sales in just four years.

During the package holiday hey-day of the late 1990s more than 20m package were being sold every year but this year it is likely to be less than 16m.

The industry is haemorrhaging bookings as families and others switch to putting together their own holidays with budget airlines and their own hotel bookings.

As a result just 31 per cent of people now take a package holiday, which is the lowest ratio in 30 years.

Industry analysts report that the only way package holiday firms can survive on what are very thin profit margins is to merge.

Separately, they are also changing what they offer, moving away from the traditional sun, sea and sangria of the Spanish costas and Greek islands to long-haul trips to the Far East and the USA.

MyTravel, for example, has begun offering packages to China and even a round-the-world holiday in 23 days, starting at £4,499.

Travel industry analyst, Jeremy Skidmore, said: "We are seeing a sea-change in consumer behaviour. The bottom line is that people are turning their backs on package holidays and doing their own thing.

"The package holiday, once a desirable goal, is now something that millions of people are turning their backs on.

"It is very sad for traditionalists, but tastes have changes. I guess it is what people call progress."

He said travellers are now far more independent and no longer value the hand-holding offered by a package holiday, including reps and organised excursions.

"Going to Spain or the Canary Islands doesn't hold any mystery any more. People are happy to book their own flights and find their own way round," he said.

Mr Skidmore said: "It has become increasingly difficult to make a good profit out of selling a package holiday. The firms have had to cut prices to sell them, but prices have become ridiculously low. "It is no exaggeration that at some points of the year they are selling holidays at a loss, particularly when you get down to deals of £99 a head.

"There just isn't room any more for four package holiday firms when an increasing number of bookings are made through the internet. It is a case of merge or slowly die."

Mr Skidmore warned that prices are likely to go up, although this will be capped by the competition from budget airlines.

The British Market Research Bureau has charted a decline of the package holiday.

It says sales have fallen by 14 per cent in four years. The proportion of people making their own plans is up ten per cent to 45 per cent over the same period.

It has registered a 300,000 drop in British visitors to the Canary Islands in four years.

By contrast, Malaysia, Singapore, Thailand, Australia and New Zealand have all seen big increases in visitor numbers as people venture further.

A BMRB spokesman said: "Online holiday booking has seen a dramatic increase and the ease of booking one's holiday online makes it a cheaper and quicker alternative than visiting a travel agent.

"With Britain embracing low cost airlines, it is now possible for people to visit alternative holiday destinations such as eastern Europe.

"Whereas people previously were holidaying in Spain and Portugal, now people have more choice and may opt to travel to Poland, Estonia or Latvia instead."

Thomson has been the UK's leading tour operator since 1974 and has about one third of the UK market. Its budget airline, Thomsonfly, operates to more than 80 destinations.

The company has more than 650 travel agent shops and sells around five million holidays and flights a year. Its brands include Simply Travel, Headwater Holidays, Crystal Holidays, Thomson Ski and Snowboarding, and Jetsave. Thomson's parent company TUI will own 51 per cent of the new business, while First Choice will make up the remaining 49 per cent. The new holiday company will be based in the UK. First Choice has been operating in various forms since 1973 and started under the name of Owners Abroad.

The companies claim the merger will generate savings of £100 million a year, with much of this likely to come with the closure of holiday sales call centres and the merger of administration.

Announcing the deal, Tui and First Choice, admitted that travel tastes had changed.

In a joint statement, they said: "The leisure travel environment has changed significantly over the last few years as consumers demand flexibility and choice, seek new life experiences and look to access travel content through a number of points of sale, most notably the internet."