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Century 21 - New Business Models in Travel

Speaker Transcripts

Penny Gray

New Media Meets Travel

Good morning everybody. Over the next 30 minutes or so, I am going to be telling the tale of how an established publisher has become a leading travel provider on the web. It might seem like such a transformation would be a long story, but we have achieved all this in three years and, along the way, we have learnt some valuable lessons which I will be sharing with you.

So, first of all, who are we? Our parent company is Emap plc. Emap is one of the largest media companies in the world, with a major presence in the UK, France, US, Singapore and Australia. We publish over 600 magazines worldwide, including Red, New Woman and FHM, which sells more copies than any other monthly in the UK. One in two French people read an Emap title and there are over 87 million readers in the US. We also have a major presence in trade shows and run the Spring Fair, which is Britain's major and largest exhibition. It has expanded so far that now the NEC cannot fit it and we are funding further expansion in Birmingham. Business to business: Our interests in business to business include publishing Nursing Times, Business Travel World and many company car pricing guides. Affinity clubs also play a major part, particularly in the American market, amalgamating things like Hot Rod with a magazine, TV, shows and affinity clubs. Radio: we now own 118 major radio stations throughout the UK. These include Kiss FM and Magic FM and we now have over 6million Britons listening to us. And, finally, the last form of media that we are involved in is TV. We have our own TV station, The Box, which is Britain's biggest music television channel. So, where does Emap on-line fit within the Emap group? Emap on-line was established back in March l997, starting with just 5 people and now grown to 31 members of staff. It was set up with the remit to create profitable new business out of digital media and has now become one of Britain's biggest e-commerce companies and the biggest on-line travel retailer. Emap on-line was one of the early adpoters of digital platforms, pioneering trials in fore-runners of interactive TV, ensuring that we stay one step ahead of the ever-developing technologies. We have been pioneers in on-line distribution and now have over 100 versions of our services available for consumers to use. Over the past three years, we have experimented with a whole host of sites, but now concentrate on travel, music and entertainment and local information, which are what we see as the true growth areas.

Today, I am going to concentrate on our travel sites. We have 8 travel sites out of the current 12 internet services we provide and here they are listed. 1ski.com is the skiers site. It features over 250,000 holidays for people to book, in association with Leisure Estates. We have resort guides, so you can check out which resort to go to. We have snow reports. You can even check out the snow on a resort you are going to on a day-to-day basis. We have cameras filming in on the piste - things that we just couldn't do before. Alongside 1ski.com, we have just launched Board-it, which is a site with attitude. Board-it is focussed on snowboarders and was only launched in October. To promote the launch, we have sponsored the Boardex festival, which is the British snowboarding festival and also sponsored the British Adidas team. It even has a dictionary to translate snowboardspeak - it's been very, very successful.

The other area I would like to concentrate on now is our a2b portfolio. This targets very much the independent traveller and provides a good source of travel information, as well as the potential to book hotels, cars and flights. You can check out your flight schedules, you can check out the weather, you can check out the currency. a2bAirports focusses on UK airports and will give you information like directions, how to reach their facilities etc. a2bEurope is slightly different and focussed on trans-channel travel. You can find information and very soon book ferries and Eurostar here. You can find packages to France. You can even find tips on which supermarkets to go to in Calais and do a price comparison between wine here and wine there and all those extras. If you don't know how to find your way to the supermarket, there are also maps you can download. 

The other three sites here, that I am going to talk about later, are Bargainholidays.com, Clubfever and Escaperoutes. Bargainholidays is our market leader and I will be spending much of the presentation on this and Clubfever and Escaperoutes are two new joint ventures and probably also deserve time spending on.

Here is an example of some of Emaps travel publications. As you can see, we have put 7 of the website pages here and 2 of the magazine titles. Our philosophy when approaching travel is very much the same whatever the media. The audience must be targetted and the products must closely suit that audience's needs. For that reason, we have decided to produce a range of travel sites, not just one, so we can really address that need. We do believe that sometimes, if you try to provide everything, you can end up providing nothing. 

So, how do we describe ourselves? We provide digital distribution channels for travel products and services on a variety of platforms. As I've said, we target audiences who have a particular interest in a particular area of travel. We generate revenues from audiences in as many different ways as possible. All of our sites have transactional potential, but, in addition to this, we have advertising, anchor tenancies with companies like Amazon and we also provide holiday content for other internet sites, for example Travelocity and Travel.com. We are here for the long term. We are here to give value for our shareholders and also to fully develop our travel products with the changing needs of the marketplace. 

Next, I am going to go into some more detail about what we actually do and the first brand I am going to focus on is the award winning Bargainholidays. Bargainholidays is the place to find late availability package holidays. It is truly a digital brand, which I am going to demonstrate with the various platforms it is already available on. First of all, our website. As you can see, it looks cheap and cheerful and that's because that's exactly what it is. I see it as a little bit like a bazaar. Loads and loads of different product, loads of colour and the price very visible. It says what it is - it's a simple proposition. We have 70,000 late-availability holidays available, with live availability checking here. We also, as you can see, have flights, last minute deals and these are drawn off viewdata, from the top 28 UK tour operators.

This is the email service. From the website, people can choose to subscribe to this on a weekly basis. They can select which price range of holidays they are most interested in and they will be alerted right to their desk on these. This has been very, very successful. We have also trialled a mobile phone service where, again, selected prices of holidays are downloaded direct to people's mobile phones using SMS and WAP technology and there is even the option on the phone to click and that will take you straight through to the call centre to book. So, you see something you are interested in, press it and you're there - you can book it.

Bargainholidays.com, the digital TV service. This is in its very early stages. We have been working with both Cable & Wireless and NTL on this. The Cable & Wireless service recently launched. It is a very simple format. As you can see, there is far less information here than on the internet service. The proposition is even simpler. It is just a quick, late availability search. Our understanding is that people on digital TV want a quick transaction - keep it simple - and we are investing a lot of money in this. And there's more…Bargainholidays.com hand held service: This is a link with the Palm Pilot and what you can do here is download the Bargainholidays resort guides, which are also featured on the internet site. So, say you are going to Madrid on business, you might want to know local information, like what restaurants are available. You can download the resort guide before you travel, take it with you and never have to buy a guide book or pick up a pen and paper.

Some of the other things we are doing, looking into the future. We are investigating the potential with satellite and also broadband ADSL, otherwise known as 'fat cable'. These are the two future technologies that could have a very big impact and what our remit is always to do is to invest and look into all the possibilities. There are so many out there at the moment and we want to stay one step ahead. So, whatever is out there, we will trial Bargainholidays on where possible. 

I am going to move on now to another of our websites - Escaperoutes. Escaperoutes was only launched in September l999 and we were very excited about it because it was a website and a magazine jointly launched. The magazine is produced by our sister company Emap Elan and the website by ourselves. In a way, it is the complete antithesis to Bargainholidays, here the focus is on destination, it's aspirational, it's not focussed on price, it really is dream building. The focus audience for both media is 'Daily Mail woman' (whoever she is), age 25-35, cash rich and time poor. And it is beginning to work really, it's a whole new concept. To bring about the content for the website we have worked with travel partners, direct with specialist tour operators who have access direct into the site to update and upload their content and we are looking to grow that site with more partners in the coming year. The second edition of the magazine will be due out in January 2000 and we hope it will go out monthly later in 2000. 

Finally, as an example of what we do, this is something that is in the development stage at the moment. We have called it Club Fever - essentially it is a clubbing site. In l998 we launched a trial of holidays to Ibiza and it worked very well. We will have a travel site focussed on the youth market, with holidays to the clubbing destinations, i.e. Ibiza, Ayanapa and similar destinations. The reasons we feel that we will be so successful with this is Emap's ability to cross-promote. The clubbing site will be promoted on our other web sites. We have a range of music sites where we can promote, namely Aloud.com and the on-line version of Mixedmag. Mixedmag itself is a magazine aimed for the clubbing market, so we will cross-promote there and we also, as I have mentioned before, have our music television site Box and we will advertise the holidays on this and also on our radio stations -the dance stations like KissFM. All in all, we will be bringing more and more people into the site and getting the site known.

So, I have told you a little about what we are doing and who we are and now I want to share with you some of the things we have learnt over the past two to three years. First of all, it is very important to provide comprehensive information. The consumer is looking for this. A wide choice of differing product is what a large percentage of consumers is looking for. One of the main reasons that consumers will use a service is convenience. Make sure that it is easier for consumers to find information and buy things the new digital way than with the usual methods. If it is no different from going down the High Street or picking up the phone, it isn't going to work. Research has shown that consumers want to compare prices of differing product - they are not just happy with what you give them - so make sure there is a large range and accept that people will be looking at other sites as well. Consumers like to find for themselves the product they want, but in an easy way, and large inventories ensure that they will find the product they want. We believe that we can provide edited choice. Although a breadth of choice is very important, at the same time, as was mentioned earlier, if you constantly extend the product, the consumer gets confused. We do believe ourselves as travel specialists - and we are in associations with magazines like Escaperoutes - that we can really show credibility and give the consumer value choice. 

So what else have we learnt? First of all, supply fresh, changing content. You want people to come back to your site again and again. They may go to the site once, like it, and in two days time go to the site again. If it looks the same, you may get a third chance but, once they have looked at it three or maybe four times and there are no changes, they will just move on to someone else's site. So we update on a daily basis. Make sure you create a fast-track service. You will have people who will be using your site again and again. They know how it works, they know what they want to do and they want to do it there and then. For example, with Bargainholidays, we have people who use the service seven times a year. They know the site like the back of their hand, so they just want to go in there and book the holiday. So make sure you have allowed for that. But, having said that, always cater for every type of web user - you have your experienced users, but there will also be first timers as well. They are probably, in some ways, your most important customers - make it easy for them. Currently, consumers have a preference for buying uncomplicated products on-line. The simple products like package holidays, cars, flights, hotel rooms. I believe that, as we look to the future, people's expectations will be higher and they will be looking to do more and more but, at the moment, this is where the focus is and what is selling.

Another thing we have learnt is that the websites not only create on-line booking, but also create leads to generate a lot of call-centre business. A vast quantity of people out there are happy to seek out the information on the web but, when it comes to actually making a transaction, they want to speak to someone. They want some hand holding.

Finally on the things we have learnt, spell out the proposition. Make the service a simple message - don't even think that you can fool consumers with buy-on-line, because you can't. If it is just an information service, make that clear. If they know that, they won't be disappointed, but there is so much hype around the internet that expectations are high. 

Provide 'over and above' service to consumers. For example, there was an instance in the States with a wine-purchasing website. A guy orders his wine, gets an email back saying 'I'm sorry, that wine isn't available, but we'll send you a case of more expensive wine at no extra cost'. It is that kind of service that will raise their expectations. 

Be aware that instant responses are expected. As I mentioned on an earlier slide, people are using the web for convenience. If they send you an email, they are almost looking for you to reply straight away and it has certainly got to be within hours. The same day is crucial. If you leave it longer than that, they will walk away, because someone else will be doing that.

Something I have touched on earlier is about providing telephone and email support. Things will go wrong, people will have questions - it all goes back to that hand-holding. This is something that is vital and I don't think it is something that will go away.

Aim to offer a service that works all the time. People are using the internet more and more and there will come a time when they will want to book a holiday at 9o'clock in the evening or on a Sunday afternoon. We have got to back that up - that's what consumers are looking for. Also, remember that whatever you do, always try to run it from their shoes - from the consumers perspective. Think of yourself as the consumer - how is it going to work.

Some other key points that we have discovered - some of these may be obvious. Effective marketing distribution is vital to success. The web is now a very large and cluttered place. There are very many travel websites and a lot more to come. You have to stay one step ahead of the game. You may have a great product, but you have got to get out there and tell people about it - find a means of doing that. Partnering with experts is also vital, to provide that edited choice, to provide that credibility. We are the experts in distribution and promotion but you are the experts in the travel product. And be prepared to spend huge amounts on marketing. People are spending up to 80% of their budgets on the internet start-up companies - these are vast amounts and you need to keep up. Another thing we have learnt is the importance of effective partnering. It enables travel specialists to connect with our experience and gives them access to pioneering distribution technologies. It allows us to provide competitive pricing and comprehensive product and also allows us to find suppliers who can help us finely tune our sites to the target audience's needs. Partnerships, basically, allow both parties to concentrate on what they know best. They allow you to concentrate on the travel business and us to concentrate on the distribution. 

Finally, I would just like to end with showing you some of our partners and take any questions you may have.

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