Hotel Online  Special Report

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  Consumers Highly Inclined To Purchase Vacation
Packages Online, But Frustrated With Lack
of Flexibility in Planning
San Mateo, CA and Sherman, CT (December 18, 2003) - Consumers are increasingly open to purchasing vacation packages online, but frustrations with the lack of flexibility in the planning process have kept completion of such transactions low according to a study by Vividence Corporation and PhoCusWright Inc.

The companies today released their syndicated research report "Vacation Packages: A Consumer Tracking and Discovery Study" which takes a detailed look into how consumers evaluate and make travel plans online.  The study focused on consumers' response to the growing promotion of vacation packages, which many travel companies are hoping will help boost travel sales.  The firms monitored 1,500 consumers as they used the Internet to research and arrange their next vacation.

The study discovered that, while only 28 percent of consumers have bought travel packages online in the past, the majority (68 percent) express a desire to do so for their next vacation. 

Consumers Discouraged with Inflexibility of Most Online Travel Packages 

Despite the inclination to purchase multiple services online, most consumers (73 percent) express frustration at the inflexibility of travel packages currently offered online, particularly with pre-packaged vacations.  Consumers most often complain that they cannot select the providers they prefer (50 percent) and that online packages often do not include all the amenities they are looking to include (32 percent). 

The greatest interest was in dynamic packaging, or the ability to assemble ones' own vacation package.  The majority of consumers (68 percent) feel that they can assemble a better package on their own, and often do so at multiple sites.

Consumers Consult Internet, Family & Friends in Travel Planning

The majority of travelers (56 percent) already use the Internet to research and purchase travel services.  The Vividence-PhoCusWright research found that one in three users visited the Web more than 10 times when planning their last vacation.  In addition, Internet research is the most influential factor for consumers when considering travel plans next to the personal recommendations of family and friends (59 percent).  In comparison, travel agents (31 percent) and travel books and magazines (12 percent) are distant considerations. 

Diverse Approaches to Online Travel Planning

Consumers cast a wide net when planning their travel.  While some consumers (18 percent) purchased all their travel services (e.g., air, hotel and rental car) from a single site, most consumers (40 percent) booked travel services at multiple sites.  Seventeen percent purchased only one travel service, and 19 percent did not purchase any services online.

Although online travel agency sites (such as Expedia and Travelocity) are the most prevalent places for consumers to research and purchase travel services, destination and supplier sites are also widely used.  Search engines (such as Google and Yahoo!) and online travel agency sites are the most common starting points for travel planning.

Overall, the most visited sites were Expedia (1), Google (2), Travelocity (3), Orbitz (4) and Yahoo (5).  While major travel sites garnered many hits, consumers did not isolate their browsing to only top sites; more than 2,000 different sites were visited by the 1,500 users tracked. 

Price, Convenience Drive Purchase

Perhaps predictably, price and convenience are the biggest drivers of online travel package purchases with 84 percent of consumers reporting price as an important driver and 78 percent mentioning time savings.  Interestingly, consumers were not strongly confident that they were receiving a better value when purchasing a vacation package, suggesting that travel firms must do a better job of communicating price savings. 

Florida, Las Vegas Top Winter Package Destinations

For their next trip, 60 percent of respondents indicated they are planning a vacation to a domestic U.S. destination, 25 percent to an international destination and 15 percent to the Caribbean or Mexico.  The top U.S.  destinations for 2004 travel are Florida (1), California (2) and Las Vegas (3); however Las Vegas and Florida are the most popular in terms of packages.  Researchers hypothesized that fewer travelers choose packages when planning a vacation to California because of a greater need for flexibility in traveling outside of metro areas. 

PhoCusWright is a travel intelligence organization that specializes in strategy, research and forecasting for the world's largest industry - travel, tourism and hospitality. Established in 1994, PhoCusWright Inc. is headquartered in Sherman, CT. 

Vividence is the leading provider of customer experience market research for the customer-driven enterprise. 


 
Contact:

PhoCusWright Inc. 
Sherman, CT. 
www.phocuswright.com

Vividence Corporation
www.vividence.com
 

Also See: ”Jump Up and Shout Yes - Delivering Best Online Customer Experience, Nice Job Vividence! / Neil L. Salerno / July 2003
Booking Engines Are Like A Box of Chocolates...You Never Know What You’re Gonna Get! / Neil Salerno / October 2003
Hotel Industry Web Site Study; Expedia, Travelocity and Sheraton Delivering Best Online Customer Experience / June 2003


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