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Web 3.0 and Orbitz

Posted on Monday, Apr 30th 2007

We have been discussing about the online travel industry and have covered Yahoo! Travel, TripAdvisor and Travelocity from a Web 3.0 perspective earlier. Here we take a look at Orbitz’s offering.

Orbitz, founded in 2001 is an online travel agency, now owned by Travelport, which in turn is in the process of being acquired by The Blackstone Group. The site is ranked third among the online travel service sites with 15.2 million visitors every month.

Context
While discussing Travelocity I had mentioned that I would like to see Context nuances included as options in the navigation and Orbitz seems to be the site that has at least a reasonable attempt in this direction. It has contextual navigation which includes Family, Beach, Luxury, Golf, Gay/Lesbian, Racing, Romance, Sports, etc. The site also has good contextual navigation for students. It could have done much better with business travel. Clearly Orbitz has made progress on this front though there is scope for improvement.

Besides these, there are the obvious other categorizations like Flights, Hotels, Car Rentals, Vacation Packages and such, which are the table stakes in the travel segment.

Content
Orbitz contains information on more than 400 airlines, more than 65,000 lodging properties worldwide and 13 rental car brands.

Orbitz has Hotel Matrix™ display, a comprehensive overview of a city’s hotel options organized by price, location and star rating. The local attraction, local history, traveler’s reviews are good. Inserting more on local secrets would be a very good idea. As I mentioned earlier, mashups are a very good way to do so, but it doesn’t seem like Orbitz is doing this either.

Orbitz could also get into more esoteric content. Say I am looking at traveling to Africa, and I am not just interested in the Safari but I would be keen on staying in a tree house, inside or near a game park. I would like to be able to plan an itinerary purely based on tree-houses in Africa, as well as enjoy the local festivals, get advice on local food that I must have, and recommendations on local music and culture. A mashup with local sites (if they exist) could solve this problem. Possibly some content licensing may be necessary. Whatever be the means of accessing esoteric content, I do feel that most of the travel sites have quite boring Content, and don’t leapfrog each other in any direction.

Community
Orbitz has 19 million registered users who can plan trips, share photos and yes, also play online games. The site also allows users to share music through Insider Podcast via RSS or iTunes. Now, you may wonder, why would a user come to a travel site to play games? Or to share music? I find this to be among the silliest ideas a product team could possibly have come up with. Please do NOT emulate this!

Orbitz, like the rest, should instead learn community engagement from TripAdvisor.

Commerce
Orbitz earns a substantial portion of its revenues as commission on the different services rendered. It charges $5 as service fee on all e-tickets booked through its site. Orbitz has tie ups with a host of partner sites like Priceline which provides customized flights, hotels and rental cars services. Access America sells its travel insurance through the site, a nice touch, often missed by others.

Orbitz Rewards platinum MasterCard is a good co-branding strategy, which also serves as their Frequent User program.

Personalization
Orbitz is the first and only travel site with a team of experts that monitors nationwide travel conditions for travelers. The OrbitzTLC Team gathers and interprets FAA, National Weather Service and other data to provide personalized travel intelligence – real-time information that travelers won’t find elsewhere. This is an interesting attempt at personalization.

Since they do have a call-center handling this sort of service, Orbitz could also consider a “Travel Concierge” implementation, that can take a broad spec, and plan a trip on behalf of the
user. My earlier example of the Africa trip, for example, would be one that would today take me enormous amount of time and research to plan. If Orbitz would offer me a Personal Concierge, I might even be willing to pay for such a value added service.

Vertical Search
Vertical search features in Orbitz seem more user friendly than TripAdvisor with expandable search options. I have also talked about vertical search based on Context, which Orbitz does provide, along with the usual vertical search options for flight, hotel, car, etc.

Business Model
Orbitz earns most of its revenue from commissions. About 70% of its revenues are from Airline ticket sales. Moreover, with an Alexa ranking of 620, Orbitz is also preferred strongly as an effective advertising option for sponsored search.
Their total click through percent of sponsored ads is 72.1%, compared to 59-62% achieved by Expedia and Travelocity (according to comScore reports). The advertising rate for Orbitz ranges between $20 – $65 CPM. In 2006 Orbitz earned revenues of $800 million with an EBITDA of $141 million.

Web 3.0 Rating: Context: A, Content: A-, Community: B, Commerce: A-; Personalization: B+; Vertical Search: A-; Overall Rating: A-

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With your reviews, I am getting so much of knowledge on the online travel industry, that i feel like applying to one of them.I bet they would take me in.:-)
way to go!deep analysis coupled with solid views on how to enhance to power of web 3.0.

Pawan Sahay Monday, April 30, 2007 at 11:23 AM PT

[…] of online travel and very detailed specific reviews on Yahoo! Travel, Trip Advisor, Travelocity, Orbitz and Expedia based on what he terms the web 3.0 framework. These present an excellent analysis by a […]

Web 3.0 = (4C + P + VS) « Travel and Web 2.0 Tuesday, May 1, 2007 at 3:34 PM PT

[…] discussing the online travel industry and have covered Yahoo! Travel, TripAdvisor, Travelocity, Orbitz, Expedia and Priceline from a Web 3.0 perspective earlier. Here we will take a look at Lonely […]

Sramana Mitra on Strategy » Blog Archive » Web 3.0 and Lonely Planet Friday, May 4, 2007 at 10:17 AM PT

I had booked flights, hotel, vacation= packages in Orbitz.com and I the website is the easiest website to navigate than Expedia or Travelocity.

Laurie Tuesday, December 25, 2007 at 3:31 PM PT