Monday, August 15, 2005

Online travel sales soars - search engines are the drivers

Revenue at online travel agencies such as Expedia and Travelocity will soar 19 percent to $27.7 billion in the United States this year, according to a report released last week by financial services company Merrill Lynch.

The new estimate is more optimistic than the one Merrill Lynch issued just three months ago, which predicted U.S. growth of 15 percent. One reason for the more bullish forecast is that although consumers have the option of purchasing directly from airlines, hotels, and other direct suppliers, bookings via online agency sites were nonetheless up by 20 percent in this year's second quarter. Consumers also will up their spending with direct travel suppliers on the Web, predicted Merrill Lynch.

The firm forecast that revenues at direct suppliers online will grow by 27 percent this year, to $32.5 billion. Overall, online travel sales will account for an estimated 30 percent of the total travel market this year - up from 25 percent last year and 21 percent in 2003, the report asserted.

By 2007, Merrill Lynch predicts, online travel sales will represent 39 percent of all travel revenue, with growth from direct suppliers outpacing that of online travel agencies. In the report, Merrill Lynch research analyst Justin Post concluded that search engines are driving much of the increase in online bookings. He estimated that travel search technology accounted for $600 million in direct bookings last year.

What's more, he predicts that search-related bookings will double each year through 2007. Of the online agencies, Merrill Lynch expects Expedia to again capture the largest market share, with 44 percent of bookings this year; Travelocity will account for 23 percent of bookings, while 19 percent of online travel agency dollars will go to Orbitz.

Thursday, August 11, 2005

The Internet: Consumers' Favorite Travel Destination

88% of Online Consumers Use the Internet to Purchase or Plan This
Summer's Vacations


Overwhelmingly, consumers are turning to the Internet for their
summer travel planning and purchasing needs, according to
independent research conducted by Feedback Research, a division of
the Claria Corporation, a leader in online behavioral marketing.

By analyzing the actual online traffic and conducting a survey among
a sample of Claria's tens of millions of software users, Feedback
Research was able to gain insight into online travel research and
purchasing habits. Data was analyzed from April 1 through July 1,
2005, in the months leading up to summer vacation travel. A survey
was also conducted among users who viewed travel category sites in
the prior 30 days and also had purchased travel in the prior 12
months.

Results indicated that consumers are still taking a trip to the
Internet for their travel planning and purchasing needs, with 88% of
survey respondents who went or are planning to go on summer vacation
using or planning to use the Internet to research and/or purchase
their summer vacation arrangements this year. 61% of respondents who
went or were planning to go on summer vacation this year purchased
or planned to purchase airline tickets online, +11 pts vs. those who
went on a summer vacation last year. 52% purchased or planned to
purchase hotel accommodations online, a +12 pt increase from last
year.

Further results indicate:

Consumers Travel Online to Compare Prices

Low prices seem to be the key driver for consumers researching and
buying travel for their summer vacations this year:

- When purchasing travel arrangements, 53% of respondents indicated
that they would travel with the brand/company that offered the
lowest price.

- Among respondents who purchased travel online: - 78% chose the
site(s) they typically purchase from because of good prices/rates; -
56% because the site was easy to use; and - 28% because of loyalty
or frequent flyer programs.

- 73% of respondents who purchased travel online have researched
travel at a general site, but then went to a specific company's site
to purchase their travel arrangements. - 52% of those respondents
did so because they found that company sites offered the lowest
prices. - 47% cited special deals and 43% cited better prices at
company sites while 22% wanted to receive frequent flyer credit.

- Consumers, perhaps looking for a low-cost travel deal, seemed to
site- hop between general travel sites and major airline sites: -
Over half of those who viewed Delta.com, United.com or Southwest.com
during research period, also viewed Orbitz.com.

- Site-hopping also seemed to be popular among general travel sites;
Of those who viewed Hotwire.com during the research period, 71% also
viewed Orbitz.com, 67% also viewed Expedia.com and 62% also viewed
Travelocity.com.

- Of all travel category sites, airline only sites seemed to have to
most repeat viewers per month during the research period:
Southwest.com had the most repeat viewers with the average viewer
coming back 9.31 times, this followed by AlaskaAir.com with 9.29
times and NorthwestAirlines.com with 9.19 times.

Internet Eases Procrastination for Travel Planners

- Among respondents who went or were planning to go on summer
vacation this year, 73% started planning 1 week to 3 months before
leaving.

- Travel sites saw their biggest increases in traffic in mid-June.
Hotels.com saw the biggest jump, closely followed by Marriott.com,
Cheaptickets.com and Orbitz.com.

- 50% of respondents typically purchase travel arrangements online 1
to 2 times a year while 27% purchased travel arrangements online 3
to 5 times a year.




Wednesday, August 10, 2005

Baha Mar Eyes Hotel Partner

The Baha Mar Development Company is in advanced stages of negotiations for a hotel partner and intends to meet an August 30 deadline to formalize an agreement in this regard, a company official said on Tuesday.

The company, which is carrying out a $1.2 billion redevelopment on Cable Beach, is also seeking a casino partner.

In the meantime, Baha Mar has embarked on a $15 million renovation of its properties on Cable Beach with a key element of the plan being the renovation of the Crystal Palace Casino.

In fact, Mr. Heller said the casino is undergoing "the largest amount of immediate change. If you come into the casino you would see already new slot machines on the floor. I’m sure most people realize that the gaming equipment was very old and we have state-of-the-art slot machines coming," he said.

A section of the casino has been closed off as part of the renovations.

The Baha Mar executive also reported that upgrade of some rooms at the Wyndham has already started. "We are going to be undertaking a major redevelopment programme," he added, noting that the work already taking place is only an interim step in improving the properties during the pre-development stage of Baha Mar.

As it relates to the design of the mega resort, company officials continue to note that there is a lot that has not yet been set in stone. Mr. Heller said, "We are evolving our plans as we discuss with our partners how everything fits together and we will be tearing down some portion of the properties in various stages. Our goal is to keep as much running as long as possible to minimize the impact on jobs and keep as many people as possible employed and transition them all to the overall Baha Mar complex when it opens." He added, "The final design is what you have when you start construction."

Baha Mar executives once viewed the Wyndham, formally owned by Wichita businessman Phil Ruffin, as the most neglected of the properties they bought at Cable Beach.
But Mr. Heller said that is all changing.

Baha Mar has plans to create a commercial village that will accommodate the business and government offices that are presently along the Cable Beach Strip which will be affected by development in the area.

The creation of the village will pave the way for the diversion of the West Bay Street, which officials say is slated to begin January 2006. Baha Mar has asked Bahamian architects to submit proposals for this aspect of the project.

Wednesday, August 03, 2005

Fishermen Warned To Obey Rules As Crawfish Season Opens in the Bahamas

The Bahamas crawfish season opened yesterday after a four-month ban.

Minister of Agriculture and Fisheries, V. Alfred Gray, urged fishermen to observe all of the rules and regulations or face prosecution. As in previous years, the Department of Fisheries is gearing up to fight poachers and illegal fishing.

It is believed that most poachers are commercial fishermen, primarily from the Dominican Republic, who habitually fish in the southern Bahamas. The maximum penalty is a fine of up to $50,000 or a one-year term in prison... or both.

The Department is warning against the trapping of undersized crustaceans and the use of unlicensed apparatus.

All crawfish caught must be at least five-and-a-half inches in tail length and three-and-one-quarter inches in jacket length.

Fishermen who are interested in using air compressors and traps to harvest lobsters need to obtain a permit from the Department of Fisheries. Compressors can only legally be used between the depths of 30 and 60 feet of water.

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