Online travel sales dominate

The dynamic growth of online travel sales was the dominant topic at this year’s FVW Kongress, which took place in Cologne from September 19-21. The latest trends in business travel, aviation, hotels, car hire and travel technology were also important parts of the annual event, which drew top managers from Germany and other countries.

In his keynote speech, TUI chairman Michael Frenzel highlighted the advantages of established brands such as TUI in the dynamic online travel sales market. “We believe that as a producer and content holder we have the advantage over the retail portals,” he declared. Consumers would prefer to book a known and trusted brand, as shown by the trend in the USA where airline and hotel portals are putting online travel agencies under pressure, he noted. But in contrast to Thomas Cook, TUI had no plans to turn its online portal “tui.com” into a full travel agency selling competitor products, Frenzel added.

Brent Hoberman, chairman of lastminute.com, a Sabre subsidiary since August 2005, highlighted the importance of innovation for online travel agencies. Speech recognition, for example, could be a new function, he indicated. Lastminute.com aimed to further simplify online booking of airline and hotel offers, so that the entire booking was as simple as buying a package holiday, Hoberman added.

Esteban Walther, head of Google Travel Europe, announced that the world’s dominant online search engine, would invest in the travel sector over the next few years. “We will bring our applications such as Google Earth more strongly on to the market than up to now. Tour operators and travel agencies can also benefit from this.” But he gave a clear “No” in response to the question whether Google might one day present itself as a tour operator. “We want to remain an open site, and also have enough challenges to overcome,” he commented.

In a panel discussion, Andreas Schräder (Thomas Cook) said that thomascook.de online sales had doubled in the first few days after the re-launch as a full-service online travel agency offering competitor products. Jens Uwe Parkitny (Expedia) also stressed that customers wanted transparency and product comparisons. In contrast, Michael Ohm (TUI), stressing the importance of offering unique TUI products, announced that tui.com would present the group’s products “more sharply” than before but declined to reveal further information.

At the inaugural BizTravel forum, senior executives of the world’s largest corporate travel suppliers outlined their strategies, but also stressed that “size is not everything”. Mike Buckman (BCD Travel) said the Dutch-owned group would carefully evaluate further expansion following its acquisitions in Germany (TQ3), the UK and North America. At present, it was about to enter the Hong Kong market, and planned about 6-8 new investments in 2007.

Charles Petruccelli (American Express) highlighted the US group’s strong presence in Asia but predicted tougher competition from local companies in the region in future. Hubert Joly (Carlson Wagonlit Travel) stressed that all four leading groups could increase their market shares in future since they currently only had a combined 25% of the overall worldwide business travel market. He predicted strong growth in online bookings, although the USA with 40-50% online bookings, was now only growing slowly.