PING! This just in...

Coastal communities cash in on lucrative love medicine

8 January 2008

A remote fishing village in southern Madagascar has sold its first batch of locally farmed sea cucumbers - believed to be a potent love medicine in southeast Asia - and is hoping to cash in on the lucrative market for unusual aphrodisiacs in advance of Chinese New Year next month.

Etc, etc, etc.


Crikey.....

Hitwise is scaring the hell out of the everyone today with data from the week ending 5 January 2009 showing that flight searches in hte UK were down 42.4% on the same week 12 months before.

Searches to the US and Eurozone countries have falled significantly (USA down 52.2%, Eurozone (down 44.8%) while their non-Euro counterparts fair slightly better (RoW down 34.4%, UK domestic down 32.7%).

Within an hour or so of one particular article in FT earlier today, one of the companies who would be less than impressed with such a slump was on the phone suggesting that the figures should be given more thought.

This is their analysis:

The most recent week ending 5 January had only one proper day when people would be back at work from the Christmas break and browsing the web, Monday 5 January.

In contrast the week ending 5 January 2008 had arguably three days when the majority of people had returned to work and resumed normal behaviour, Wednesday 2 to Friday 4 January.

It is a valid point.

Various surveys show that many consumers use their lunch breaks at work and at other idle times (Is this right?!? Ed) to conduct searches for travel, before booking later in the evening.

During the Christmas break, however, users were either at home or out and about visiting friends and family, or spending their way through the New Year retail sales.

This might go some way to explaining the slump, but surely this can't account for such dramatic falls in searches?


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There is no question that Lonely Planet has come a very long way since its days as a publisher of dog-eared guidebooks for overlanders from Kathmandu to Istanbul.

The Thorn Tree forum, online destination guides and white labelled meta search engines via Kayak and Global Travel Market have given it a decent presence on the web.

But forgetting for a moment the controversy about the company selling out to joining the media beast that is the BBC, questions remain for many as to where Lonely Planet as a brand goes next.

Some indication might come in the form of its new CEO, unveiled earlier this week as Matthew Goldberg, a man some are calling a "digital heavyweight" who joins from his position as web guru at Dow Jones.

The next few years will certainly be a fascinating period in the history of Lonely Planet as it looks to maintain the strength of the brand in the face of increasingly sophisticated trip planning and content websites in the form of Triporati, Nileguide, PlanetEye, Yapta et al.

Any ideas on what Lonely Planet should do with its online offering?

The most frustrating on-off deal of the latter part of last year was finally completed yesterday when the Thomas Cook Group bought lastminute.com's MedHotels for an undisclosed fee.

Rumours first circulated at The Travel Convention in Gran Canaria in October, when - in keeping with the annual ABTA shindig - cocktail-fuelled delegates started gossiping into the early hours of a deal to buy the bedbank.

Lastminute.com's press team on the ground running its tenth birthday party made valiant attempts to quash the titter tatter about Thomas Cook..

Executives from Medhotels looked visibly shaken whenever any of the press pack mentioned it - understandable given that there were dozens of staff back in the UK who had no idea of what was going on.

Almost on a weekly basis after the event there would be a new rumour along the lines of: "You know the Med deal is happening this week, right?

And then December arrived and, well, nobody buys an accommodation-only business for Christmas do they? A Wii Bedbank maybe?!

Anyway, with the deal now finally in place what else is there to say? Well, probably quite a lot, but here are some initial points:

* The consolidation in the bedbank continues apace, as predicted by anyone with a passing knowledge of how operators need to get hold of stock and how bedbanks need a wider distribution spread.

* Sources say the currently undisclosed deal is likely to be in the region of £20 million. Thomas Cook's previous bedbank acquisition, Hotels4u.com last February, was far more open and tabled at around £21.8 million.

* Observers will now turn their attention to TUI Travel, which if speculation is true, has been pipped by its arch rival twice in the space of a year. Does it need to be more aggressive with its buying?

* It is worth remembering that despite the high profile coverage in the trade media of the two most recent deals (a reflection on the personalities involved, one might argue), TUI has been quietly building a strong portfolio of accommodation-only providers of its own over the past few years - Hotelopia and Laterooms are decent businesses, lest we forget.

* It is no surprise at all that LowcostBeds has been quietly growing and most interestingly expanding in recent months, buying IdealCruising and recently its deal with Resorthoppa.

* Where does this all leave the trade media's omnipresent Youtravel.com and other, smaller bedbanks? Most insiders believe that Youtravel founder John Kent (who, ironically, created Medhotels before selling to lastminute.com) was looking at a three to four-year exit plan for the business. Is this still a likely scenario given how the market has developed and the economic climate?

* Finally and most importantly, it is believed by some - even rival bedbank bosses - that the latest deal will actually be good for everyone (except consumers, of course). Last year saw a pretty grim price war in the sector and some reckon rates were driven down by almost 40% - but this is unlikely to continue and prices could return to a more sustainable level. In other words: higher.

So while it is doubtful that the bedbank sector will ever be as sexy as the airline or hotel ends of the industry, it is certainly one of the most interesting, dynamic and, thankfully, provides us hacks with endless material to write about.

What do we all think?

There probably hasn't been a day like it before - when the global CEOs from two of the biggest online travel agencies on the planet quit within hours of one another.

Steve Barnhart (Orbitz) and Michelle Peluso (Travelocity) may even have worked it out together over a glass of mulled wine at Christmas?!?

Anyway, a friendly mole within the Travelocity empire kindly sent us Peluso's emotional farewell note to some of her staff.

Hi all,
By now you may have heard the news that I'm leaving Travelocity in early February. First of all, as you can imagine, it was an incredibly hard decision to make.

I could and did think of a thousand reasons to stay  - not the least of which is how much I've enjoyed working with the Travelocity team and with so many of you in the industry -  but in the end, there is one big reason to leave, and that's my family.

Being CEO of Travelocity Global is the greatest honor I've had, and I've never given it less than my all.

Giving it my all means a great deal of travel, and now with Auden, our new daughter, I just don't feel I can do that anymore and be the kind of mom for her I want to be.

And so, I came to the decision that it's better for me to find a new challenge closer to our home in New York. 

But the most important thing I want to express is thank you for such a wonderful almost 10 years running Site59 and Travelocity.

Despite the challenges we occasionally face, this is an extraordinary industry - one that makes it possible for people to realize their dreams - be that to see their grandchild born or to see the night sky on the other side of the world. 

I've always been profoundly conscious of what a privilege it is to have had the opportunity to help shape our industry and to work with so many extraordinary, inspiring people in all of you along the way.  I thank you enormously for these terrific years, and I know we will keep in touch.

And, finally, Hugh Jones has been chosen by Sam and me to take over the CEO job, and I'm very excited about that.  Hugh will be a terrific leader of Travelocity and along with our stellar leadership team - and such a talented group across the company - the future is exciting. I'll remain a committed investor and a devoted fan even as I move on to new things.

Hugh and I will be working on the transition over the next month, and I look forward to introducing him to those of you who are our partners who don't yet know him.  You will find him as smart and talented as I do. 

Once again, thank you - it's been an incredible joy and privilege.

Michelle


Having met Peluso a couple of times over the past three years, she certainly had an incredibly genuine and pleasant way about her.

A colleague told me tonight that Peluso's departure is "a big loss" to Sabre.

Buried, understandably, at the bottom of the Orbitz announcement this morning about its new CEO, Barney Harford, are a very worrying few lines for anyone who works at any of the Orbitz brands.

"In addition to its leadership transition, Orbitz Worldwide today announced that it will take further measures to lower its operating costs.

"In combination with the expense and workforce reductions announced in November 2008, these latest measures are designed to position Orbitz Worldwide for success in the face of the challenging economic prospects for the global travel industry.

"Over the next several weeks, Orbitz Worldwide will implement measures designed to lower its cost structure by an estimated additional $20- 25 million annually, in addition to the $20 million of annual cost reductions announced in November 2008."

Read it again. Orbitz is looking to lower costs by up to $45 million annually, if you add the two together.

Anyone who thought the global economic situation would not hit the OTAs too hard will be re-examining their predictions.

Which? magazine, via the Telegraph, says the BBC's Strictly Come Dancing show is so popular that it has fuelled a rise in dancing holidays.

Now for some of us the idea of going on holiday to learn the quickstep sounds about as enticing as a Saturday night in with the X-Factor boxset, but don't underestimate how influential TV concepts can be.

For example, parents of toddlers in the UK will be more than aware of the Balamory series on CBeebies. The VisitScotland website has optimised a page specifically for holidays to the island of Mull, where the programme was filmed a few years back.

Of course, the TV-inspired holiday or travel product has been around for years. Just the place where the exterior shots were filmed for the bar in Cheers, the seminal US sitcom of the 1980s, has fuelled a mini-industry in itself for the city of Boston.

So another thing to add to the off-kilter marketing plan, especially online where clever SEO can play a big part, is to recognise consumer trends and popular culture.

* Michael Palin does a jaunt around the Amazon - create a landing page on your site showing trips available to South America and editorial content with images about some of the destinations featured in the series. [The BBC will love the publicity].

* Think political. The Davos shindig comes around once a year, and it's held in an incredibly beautiful part of Switzerland, so ensure you have Davos and other Swiss destinations up front on your homepage over the duration of the event.

Any more examples?

So our Predictions 2009 article was a rather nice collection of views from across the travel sector (thanks to those who contributed).

Now, as one would expect, we had a fair bit of correspondence and conversations following its publication which contained predictions which people would rather not put their name to.

One emailer suggested that the user review site realholidayreports.com site would be ripe for a takeover a la Holidaywatchdog and Holidaysuncovered.

Our correspondent said:

"It ranks very well like Holidaysuncovered did, and looks just as hideous prior to TUI purchasing it."

Quite.

After asking around it appears that Tripadivsor would feature in many people's list of likely buyers for the site.

We also got into a conversation with the founder of a new trip planning site which launches this year. He kindly sent us the business plan and - hey presto - the exit strategy has none other than Tripadvisor named as one of the companies it hopes would be interested in buying it.

So which sites do we think are likely takeover targets in 2009?

.......well, at least when it comes to our news coverage.

Four of the top ten most popular stories on the Travolution website in 2008 were about Ryanair and the screen-scrape debacle over the summer.

Also good to see that eight out of the ten were exclusive stories to Travolution, gathered by our journalistic endeavour rather than regurgitated press releases (our policy also seems to be working).

By way of comparison, here are Travel Weekly's top ten stories of 2008.

Woolworths is probably the highest profile UK High Street store to go out of business as a result of the worsening economy.

Deloitte is handling the winding down process for the business (expected to be completed by Saturday 3 January) and will be selling off stores situated in some of the best retail spots in the UK. [Hello, Tesco, et al?]

In the midst of the collapse of one of the oldest retailers in the UK, Travolution readers will no doubt remember how Woolies entered the world of online travel almost two years ago to the day.

The Woolies website created its own travel channel, provided as a white label by Wefly, containing the usual array of facilities for booking flights, hotels, package holidays and car hire.

This white label will be no more as the Woolies website was pulled on the day Deloitte stepped in as administrators.

A call into Deloitte earlier this week, who by their nature and the role they are playing are frsutratingly matter of fact about absolutely everything, revealed only a few nuggets:

* The trading relationship between Woolies and Wefly ended the moment the administrators stepped in and the site closed down.

* Any cross-promotion credits - such as store credit vouchers given as a result of buying travel products online - will be null and void once retail outletts close and therefore consumers should claim any monies from the adminitrators.

Now some might wonder how much Wefly has lost out as a result of the collapse of Woolies?

Most would probably say not that much - Woolies was hardly a giant of the High Steet with regards to its online presence and therefore the white label was probably not the biggest revenue driver. Wefly, let us remember, also powers the Asda travel channel.

However, it is worth looking at how many of the UK High Street and online retailers have online travel channels and who is providing the functionality for them.

This sample is based in part on those appearing in the IMRG-Hitwise Hot Shops list for November 2008 and a number of other retail lists.

* Tesco Travel (provided by lastminute.com)
* John Lewis's Greenbee (Expedia and Cox & Kings)
* Asda Travel  (Wefly)
* Orange Shop (Kayak)
* Waitrose's Greenbee (Expedia and Cox & Kings)
* Aldi Travel (On Holiday Group)
* The Co-Op (Co-Operative Travel)
* WH Smith Travel Store (Wefly)
* The Disney Store (Traveltainment)

Rumours abound that Sainsbury's is also developing an online travel service.