SEMINAR 2

Huella online travel ltd. is a Malaysian based online travel portal targeting Asia Market share was hovering under 5% after the launch at Hong Kong lower than the other markets Previous market Research showed that lack of awareness about Huella and risk averseness towards online purchases appeared to be the key factors

Jenny Young marketing and Market Research manager of Huella Hong Kong Online travel industry has not picked up despite high internet usage penetration and techno savvy nature of its population Lueng decided to hire Market Sense a MR firm head quartered at Australia.

The current airline booking systems 1950American Airlines travel agents to obtain real time flight data Other airlines followed ARS Airline Reservation System Various ARS soon evolved into single CRS Computer Reservation System made available to all travel agents Airlines had outsourced a significant portion of reservation process By late 1990 the major CRSs had expanded into GDS Global Distribution System

Companys that owned CRS developed a highly profitable technology CRS /GDS charge a flat fee based on number of segments per trip, agents charged a commission rate

Cheaper alternative to CRS/GDS Airlines increasingly reduced their dependence on travel agents and CRS/GDS Sell directly to customers via internet Average online sales had grown from 24.4% in 2002 to 32.4% in 2006

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Travel agents responded by unbundling their services offering tailor made travel packages A number of travel agents sprung up around the world Three types of online travel agentsOnline stores by brick and mortar agents Online travel portals which offered other services apart from travel products Online travel bidding sites

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The key advantages of online booking were: Convenience Speed Access Control

Air passengers from North America(59%) was most receptive towards online air travel purchases, followed by Europe (35%) and Asia Pacific (19%) In terms of air travel bookings, Asian consumers were less inclined to purchase ticket online despite the popularity of online hotel bookings The Asian online retailers did not invest time and manpower to update air fares frequently

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Despite its high internet usage penetration, online purchases of air ticket was the lowest in the world Reasons were : Perception of risk outweighing convenience Better offline alternatives Familiarity with traditional travel agents Geographical proximity and efficiency of citys public transport system

54% of Hong Kong travellers were uncertain about the price competitiveness between online fares and travel agents 57% found the travel agents to be extremely efficient Concern about the security of the online booking sites as well as their transaction capabilities

Full Service Travel Guru User Friendly Design Pre-packaged tours Results for intended date plus for three days around the preferred date Best fares within a self chosen date range Besides credit cards other payment options available Website was ViriSign secured

Jenny Lueng believed that any marketing understanding begin with qualitative research Lueng was puzzled by the discrepancy between low interest in oline travel and its high internet usage penetration In 2002 she hired MGO a hong based MR company to condut a study for its Hong Kong Market

Purchasing habits and attitudes of consumers towards online travel Awareness of Huella brand Attitudes and perceptions towards Huella brand Actual or intended usage pattern

Brand Awareness- low Brand Image risky and unreliable Brand Positioning Categorized Huella with other online travel agents and not with traditional agents Usage Pattern most of them never used the site, few used it only to obtain information about available products MGO suggested a second stage of quantitative research since the findings were not statistically significant

Lueng decided to conduct another MR study and would outsource Market Sense The goal was to ease consumers concerns regarding online travel purchase and ultimately increase Huellas market share in Hong Kong.