Tracking Tourism: The Tourism Research Blog Archive for the ‘Internet usage statistics’ Category

No longer can the Internet be viewed just as an add-on to marketing efforts - it is now an integral, critical part of travel distribution.

That was the view expressed by Diane Clarkson, Travel Industry Analysts at Jupiter Research and Bill Tancer, god of all things data at Hitwise, in this evening’s excellent webinar: Travel 2.0 Today, The Economy and the Evolving Travel Landscape.

More critically, Hitwise have found (through their clickstream analysis of internet users as they move from site to site) that traffic to the travel category of websites is actually increasing as people tighten their belts.

There has been no drop in travel website visits as fuel prices increase. People are instead researching their travel decisions more intensively online and are shifting to the online channel as they become more price sensitive.

Internet and online travel becomes more important in tough economic times.
Bill Tancer, Hitwise

Jupiter Research’s data backs this up. Their US Online Travel Consumer Survey from May ‘08 suggest that the next 12 months could see a sharp decline in travel frequency - with 39% of occasional leisure travellers and 43% of occaisional business travellers suggesting that they are planing fewer trips in the coming year. But the impact, Diane explains, is that “the Internet will increasingly become a tool as people research more intensely”.

The business implications of that are immense - while you may have cruised by on a sub-par website in good times, as things toughen up in the sector, people are looking at more websites and so it is critical you can attract and retain visitors on yours.

Bill and Diane’s webinar covered three key topics:

• The impact on travel of the economic downturn
• The impact of user generated content on travel brands and travel consumers
• The potential for travel and social network sites.

They kindly gave permission for their content to be blogged openly, which is much appreciated as it is not always the case with such industry analyst briefings. When the webinar is available online, I will add the link as its really worth a listen. In the meantime here are a few of the conclusions from their respective research efforts that really tingled some brain cells for me:

1. User generated content is used by 40% of online travel researchers

Yup, 40%. Not hardly anyone, or a bunch of geeks, or a few back packing students - but 4 out of 10 of the people researching travel. Jupiter’s US Online Travel Consumer Survey from May ‘08 found that for this 40% using user generated content, ratings were the most popular (used by 58%), followed by reviews and recommendations (49%). Next came user generated photo content (18%) and friend’s social networking websites (18%). Other travellers blogs we consulted by 12% and user generated video by 5%.

The impacts of this? Diane cited the importance of using this content regularly and systematically as a source of competitor intelligence. And as the next point will illustrate, she also highlighted the importance for the contribution of travellers to be included as part of brand strategy. Why? Because user generated content is highly trusted.

2. User generated content is nearly twice as influential as brand to accommodation researchers

User generated content is far more influential than brand or the recommendations of friends and family

After price and location, for those using ugc, reviews/ratings from other travellers was the major influence in the decision making process. 36% named it as an influential factor in their decision, compared to 21% citing brand/reputation and 14% citing that old chestnut of family/friend recommendation. (Source Jupiter as above).

Hitwise’s clickstream data shows that visits to travel user generated content have increased 40% in the year since June 2007. They also reveal (perhaps no surprises) that it is TripAdivsor that is the heavyweight, accounting for more than 75% of the Travel UGC and 2.0 market share. (IgoUgo pales into second at 9.5% and WAYN at 8.4%). Bill made the point that while standalone Travel UGC accounts for only a small fraction of travel visits online (2%), its reach and impact is in fact much wider as people engage in user generated content on traditional travel websites.

3.The Travel 2.0 heavyweights are in the mainstream research to purchase mix

With a graph to die for, Bill combined the flow of clicks from travel site to travel site, with market share of those sites. From this network map, he isolated those sites that are driving traffic to the big OTAs such as Expedia, Orbitz and Travelocity.

And a few Travel 2.0 players are having a big impact - TripAdvisor and the metasearch site Kayak and Sidestep. Metasearch, sites that search for price across muliple agency and supplier sites, before sending the search off to another site to book, are faring particularly well in these price sensitive times. Two years ago they were only used by the highly tech savvy, whereas now they are entering the mainstream as people research more intensively for the best prices.

However, what Bill’s uber-graph also shows is that outside these heavyweights, the smaller Travel 2.0 sites (from WAYN to WikiTravel) are very insular, with little cross flow of traffic and are currently outside the mainstream travel research traffic flow.

4. The social networking sites are not impacting as a travel planning resource yet

Jupiter (same source as above) found that only 8% of those online travellers who are using social networking sites do so for travel planning. 56% do not use social networks in any capacity whatsoever that relates to travel. The most common travel related uses come in the form of communication, with 23% looking at friends travel photos or videos, 22% keeping in touch while away and 19% posting photos.

Diane contrasted the high level of trust that people have in stranger generated reviews, which comes from critical mass. People can sift many reviews looking for patterns and things that resonate with them. In contrast, social networks have much lower critical mass.

Hitwise’s data has not seen significant increases in traffic being referred to travel sites from social network sites - Bill suggested that where it is appearing, it is potentially being caused by people that use their social networking site as their homepage.

And different segments and demographic profiles of travel researchers behave in different ways. The 55+ age group are more likely to use newspapers and magazines to find a new travel site that they haven;t used before, whereas younger users are more likely to use meta search. Website visitors, like travellers, can never be thought of as a single homogeneous mass.

So, thanks again to Hitwise and Jupiter Research for a great webinar and for allowing us bloggers to share their findings with the wider industry. I hope I’ve communicated some of the potential power of their data with this short round up.

Absolutely mainstream and absolutely heating up

In case anyone was doubting that the Internet is absolutely mainstream and absolutely critical to travel and tourism, here is my spring pick of statistics that I think deserve some serious attention:

1. Average UK Internet users now spend 164 minutes online each day, compared to 148 minutes spent watching TV. The research by TNS (on behalf of Google) demonstrates how profoundly consumer behaviour is changing online. The Internet is still regarded as some tourism businesses as a niche, somehow still less significant that other channels. The reality is that the Internet is absolutely mainstream and is challenging and surpassing more traditional media types.

2. Jakob Nielsen points out that only 25% of people travel through a site via a homepage - the rest use search and arrive deep in the site. This BBC article tells you more.

What is the implication of this? Well, many people imagine all their visitors arrive through the site’s front door and they design their site accordingly. Time and effort goes on improving the home page, while deeper pages are ignored.

How does your site fare in terms of navigation, clarity and usability for the 75% of people who enter down the chimney and through the windows of the site, rather than though the front door?

3. Google properties now drive 36% of all UK Internet traffic (source Hitwise).

What does this mean to you? Use your web analytics data to understand your share of traffic from Google. If it dramatically exceeds the 40% mark, you may need to look at building other sources of traffic and improving repeat visits to your site. If Google accounts for only a small proportion of your traffic, there may be a need to look at your organic search engine optimisation strategy.

4. comScore reports that in March, 221.2 million Europeans conducted 24.6 billion searches, averaging 111 searches per searcher. Searchers in Finland exhibited the heaviest search activity with 143 searchers per searcher, followed by Portugal (128 searches per searcher) and the U.K. (124 searches per searcher).

Search is critical to your business success online. But for the travel sector, search optimisation and visibility doesn’t stop at your own country activity (such as google.co.uk), as the next statistic shows.

5. comScore also showed that Google Sites account for more than 19 billion European searches conducted in March, representing 79 percent of the European search market.

“With nearly 80 percent of all searches conducted in March, Google is far and away the leading search property in Europe,” said Jack Flanagan, executive vice president of comScore. “However, we are seeing key local players show leadership in Eastern Europe where English is spoken less than in Western markets. With Russia’s online population now the fastest growing in Europe, it is likely that some of these local search engines will continue to gain traction and market share.”

6. 73.7 percent of the total U.S. Internet audience viewed online video in March 2008. comScore report that users viewed 11.5 billion online videos during the month, representing a 13-percent gain versus February and a 64-percent gain versus March 2007. Nearly 139 million U.S. Internet users watched an average of 83 videos per viewer in March.

Video is being found to drive travel and tourism conversion rates and consumers are both familiar with using it and increasingly search out accommodation, destination and activity related video as part of their travel research process. They are also uploading their own video reminiscences, which fuel future travellers’ decisions.

7. It’s not just the US that is seeing the impact of video. Hitwise reports that UK traffic to online video increased by 178 per cent between February 2007 and 2008, now accounting for one in every 45 Internet visits.

8. Competition is hotting up and so is online spend. Advertising spending online looks set to overtake spending on TV by the end of 2009 - the implication being that prices will rise as more advertisers chase the same inventory.

9. In 2008 12% (7.4million) of all mobile phone users in the UK are using mobile Internet services (source Continetal Research, on e-consultancy). Forrester Research project this will rise to 38% of mobile phone users in Western Europe by 2013.

This mobile phone based Internet activity often utilises ‘dead time’ while travelling and is associated with ‘task based’ activity such as checking train times, restaurant directions etc. Right now, those handful of sites doing mobile well are in a prime position to see the benefits in their bottom line.

10. As so many of these points suggest, the Internet is now absolutely mainstream for travel.

PhoCusWright’s latest Consumer Travel Trends Survey, due June 2008, reports that requent travellers and seasoned online buyers continue to dominate, but now the former “diehard” offline users have begun to use the Internet as their usual method for travel shopping and purchasing. PhoCusWright point out that as novice users, this majority of late adopters possesses different travel and purchase behaviours, have varying levels of online skills, requires different messaging and is demographically unique.

Key 2007 E-Tourism Research Findings

From analysing participation in social media, to monitoring online customer satisfaction - researchers worldwide have been generating data to help support tourism businesses online strategy. Here is my end of year pick of recent research findings that have the potential to boost tourism business performance.

Poor user experiencing taking a toll

Online travel sales may still be growing, but according to a recent survey of more than 60,000 Internet users in the United States by Forrester Research, 9 percent fewer people booked travel online in 2007 than in 2005. It is the first time since Forrester began tracking Internet spending a decade ago that a category has lost shoppers.

As the New York Times reported: “This is a wake-up call for the industry,” said Henry Harteveldt, Forrester’s online travel analyst. “Customers are tired of spending two or three hours trying to find the airline or hotel or vacation package that meets their needs.”

The New York Times article also highlighted that PhoCusWright had also found that among US travellers with access to the Internet, the percentage who usually book travel online dropped to 62 percent at the end of last year from 68 percent in 2005, while those who say they usually arrange travel offline increased to 31 percent from 25 percent during the same period.

Read the New York Times article

So the implication for businesses? They must try harder at achieving online customer satisfaction and improving the overall ease of use of travel websites. Its not the end of the world - those customers who do book online are spending more than ever. But opportunities are being lost as a proportion of potential travellers are turning away because they are not receiving the quality of intuitive, satisfying and usable online experience they require.

Customers say it’s getting more difficult to travel shop online

On the same theme, Hotelmarketing.com reported from HEDNA’s December Conference, highlighting online challenges ahead for the travel and tourism industry. They reported Henry Harteveldt, vice president and principal analyst at Forrester Research describing the industry as moving backwards when it comes to meeting travellers’ expectations. His research shows that “43 per cent believe travel Websites shopping experiences have become less useful, 15 per cent feel the Internet doesn’t help them save money and 11 per cent of US online leisure hotel guests say it’s more difficult to shop for travel online now than when they started.”

He explains that while 47 per cent of travellers are happy to fill out user profile forms, more than half of those travellers say they’re not happy with the benefits received. Travel companies need to do a better job of mining the data that is compiled. Instead of presenting tailored information to guests, “we send guests into information comas, instead of helping them,” Harteveldt says.

Hotelmarketing.com reports that Harteveldt advises the travel industry to“make online booking easier, be clear instead of confusing, reflect customer preferences, do a better job providing content and make it easier for guests to reach us.”

Again the implication for online travel businesses is the same - the experience needs to get easier for customers, more satisfying and more compelling.

And it’s getting tough out there

Just one of the credit crunch anxiety reports came from VisitBritain, as reported by Travelmole:

“VisitBritain is warning the volume of inbound tourism in 2008 will be below the figure achieved last year, blaming the current economic downturn on a reluctance of overseas visitors to travel to the UK.

The first half of next year is expected to be particularly slow, while annual growth in visits will pick up in the second half of the year, according to the organisation’s latest report, which says the value of inbound tourism will remain static in real terms during 2008.”

Though the tourist board sees a host of opportunities amongst the gloom - from the handing over of the Olympic torch and the acceleration of 2012 marketing, through to the opening of Heathrow Terminal 5, they fear the credit crunch ripples out of the US could make 2008 a tough year.

“With still no end in sight to the current turmoil in the global economy the prospects for inbound tourism in 2008 are not looking as good as they should,” says the report.

Do you know how you stack up against the competition? Your customer does

PhoCusWright were as busy as ever and here’s a piece of research businesses can bare in mind, especially as competition stiffens:

The majority of travellers visit between two and five Web sites when shopping for travel online, and the number one reason for doing this is to compare prices. At the same time, nearly 20% of travellers visit six or more sites. People who visit the most sites are likely to be motivated by a desire to read reviews, research destinations, and purchase tickets to events or attractions. (Source, Cathy Schetzine, Technology Analyst for PhoCusWright - The PhoCusWright Travel 2.0 Consumer Technology Survey)

The implication for businesses? Know thy competition! Which other four websites might your potential customers be looking at? How do you stack up in terms of access to quality content and critical information (eg pricing and value factors)?

It’s not all about the US markets

comScore revealed that over 100 million Europeans accessed a travel site in March 2007. Their study of the European online travel industry found that half of the total European online population aged 15 and older visited a travel related site during March 2007 - an increase in traffic of 6 percent versus March 2006.

According to comScore, Expedia Inc. led the European travel category with 18.5 million European unique visitors aged 15 and older during March. The second most-visited European travel site was ViaMichelin, with 13.5 million European unique visitors, followed by the TUI Group’s 12.5 million European unique visitors.

comScore also revealed that Europeans who visited travel sites in March spent an average of almost 37 minutes browsing travel-related content. Within the travel category, online travel agencies garnered the most time spent, 19 minutes on average, followed by airline sites (17 minutes) and hotel sites (15 minutes).

Great content isn’t dead

PhoCusWright found that rich media trumps reviews when it comes to influencing travel bookings. Their recent Travel 2.0 Consumer Technology Survey reveals that when it comes to making travel purchasing decisions, most American travellers would rather see the options for themselves than simply act on the recommendations of others. In fact, travellers want to view the options in detail via pictures, online maps and video.

“For travel shoppers, seeing really is believing. The fact that travelers find these visual tools to be so influential suggests that online rich media, including content-rich, three-dimensional maps, will be an increasingly important part of the travel-planning process,” said Cathy Schetzina, director, research at PhoCusWright. “Traveler review sites that incorporate these visual elements are likely to be more appealing.”

So, don’t throw out great content, simply because you get greater users reviews. Video, images and maps are fantastic for search engine optimisation - now the research demonstrates that they are great for conversion too.

Not that user generated content can be ignored!

comScore and The Kelsey Group found that nearly one out of every four Internet users (24%) reported using online reviews prior to paying for a service delivered offline. Of those who consulted an online review, 41% of restaurant reviewers subsequently visited a restaurant, while 40% of hotel reviewers subsequently stayed at a hotel.

They found more than three-quarters of review users in nearly every category reported that the review had a significant influence on their purchase, with hotels ranking the highest (87%). Such is the impact of the reviews that the researchers found consumers were willing to pay at least 20% more for services receiving “excellent” or 5-star rating opposed to those receiving “good” or 4-star ratings.

And it seems that people were satisfied with the overall accuracy of reviews. The study found that 97% of those surveyed who said they made a purchase based on an online review said yes. Full article on Travelmole

This was one of several pieces of research this year that identified the fact that potential customers find user generated reviews implicitly more trustworthy, than marketing messages generated by businesses. The business implication? If you have fans, let them speak on your behalf. Their reviews and testimonials may be more influential that your own copy and messaging.

And, finally…

So, to conclude my round-up of great research findings from 2007. The research I’ve pulled together here implies an interesting mix of opportunities and challenges ahead for travel businesses for whom the online channel has become critical.

First mover advantage has long passed and the early customer convenience benefits of online have become diluted as the space has become even more crowded and fragmented. Yet, there are techniques that individual businesses can incorporate that will work to improve conversion and customer satisfaction.

Ultimately, it seems the travel industry needs to learn from what online customers are telling them - that it is all about quality of user experience and going forward into 2008, this needs to improve.

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Research released by comScore yesterday finds that more than half the European online population now uses social networking sites.

The UK has the highest usage in Europe, with almost 80% of the online populations using social networking sites and the average user racking up more than 800 page views a month.

ComScore’s key findings include:

• The European social networking community stood at 127.3 million unique visitors in August – reaching 56 percent of the European online population
• European users average 3.0 hours per month on Social Networking Sites and made 15.8 visits in the course of the month, viewing 523 pages
• U.K. Social Networking Site Usage is the highest in Europe with 24.9 million unique visitors in August 2007
• 78% of the total U.K. online population now belongs to the country’s social networking community, compared to 62% in Spain, 50% in France, 49% in Italy and 47% in Germany
• U.K. Users Average 5.8 Hours per Month on Social Networking Sites and made 23.3 visits in the course of the month, viewing 839 pages
• Heavy social network site users spend 22 hours per month on their favourite sites, visiting 71 times and viewing over 3,000 pages

The data about these heavy social network site users are a great example of why it is important to beware of averages when looking at any form of research data. Their intense usage effectively lifts the average point, masking the lower engagement of the bulk of lighter users who account for 50% of users.

The comScore research finds that these light users (defined as being the least active 50 percent of the social networking community) spent significantly less time engaged with social networking sites’ content, making just 4.6 visits per person and consuming only 47 pages of social networking content over the course of the month.

Its an example of the 80/20 rule again rearing its head. As Bob Ivins, EVP of International Markets at comScore, explains:

“about eighty percent of all online activity at Social Networking sites can be attributed to only 20 percent of visitors.”

Clearly that has to have significance to tourism businesses advertising to and otherwise engaging with customers within the online social network space.

It will be a significant challenge to ensure that your message gets beyond the 20% of heavy users and into the bulk of the online population who are far less heavily engaged.

Related Tracking Tourism posts

How social media like Flickr and YouTube has become an influence on destination selection

To read Highland Business Research’s free Introduction to Online Social Networks, download the PDF here

Here are some basic statistics:

Total Internet users in Europe and in the World:

• Europe: 321,853,477
• World: 851,256,448

This breaks down by country as:

• UK - 37,600,000 users (62.3% of population)
• Germany - 50,426,117 users (61.1% of population)
• Netherlands - 12,060,000 users (73.3% of population)
• France - 32,925,953 users (53.7% of population)
• Sweden - 6,890,000 users (75.6% of population)
• Canada - 22,000,000 users (67.8% of population)
• US - 210,575,287 users (69.7% of population)
• Japan - 47,080,000 users (67.1% of population)

Source: Internet World Stats, June 2007

83% of US travellers used the Internet to research or book summer travel. Of these, 88% said that they would like even more information specific to their travel interests from online websites and e-mails. (Source - Prospectiv CPI Poll, June, 2006).

Half of the total European online population aged 15 and older – visited a travel related site during March 2007, an increase in traffic of 6 percent versus March 2006. (Source Comscore)

According to research by Comscore, the search to purchase cycle for travel is up to 12 weeks for UK Internet users. 85% of UK travel searchers (using a search engine) reported that they completed a travel purchase either online or offline within 90 days of their initial search.

Only 10% of online travel transactions linked to search occurred immediately following the initial search referral, while the remaining 90 percent took place in subsequent days and weeks (considered latent purchases). Indeed, fully 45% of the purchases actually occurred more than four weeks later. Latent purchasing was even more dramatic among those who initially searched on destination-related terms, with 95% of purchasing taking place after the initial search referral. (Source - Comscore)