Overview of the travel search engine market

Travel remains the single largest component of e-commerce according to Forrester Research, a consulting firm in Cambridge, Mass. But despite the dominance of such online travel agency heavyweights as Expedia.com, Hotwire.com, Orbitz.com, Priceline.com and Travelocity.com, most users consult multiple Web sites when shopping online for travel. The average consumer visits 3.6 sites when shopping for an airline ticket online, according to PhoCusWright, a Sherman, CT-based travel technology firm. Yahoo claims 76% of all online travel purchases are preceded by some sort of search function, according to Malcolmson, director of product development for Yahoo Travel. The 2004 Travel Consumer Survey published Jupiter Research noted that "nearly two in five online travel consumers say they believe that no one site has the lowest rates or fares." Thus a niche was created for aggregate travel search such as Kayak.com which seek to find the lowest rates from multiple travel sites, obviating the need for consumers to cross-shop from site to site. Latest addition in this area are sites such as Dohop.com that not only scan travel sites but also gather information on prices from low cost and traditional airlines.

Within the class of travel search engines are several subcategories of sites that offer a range of services and search methods:

Portal sites

Several of the leading generic search and information aggregator sites also offer travel components. In the broadest sense, virtually any search engine could be considered a travel search engine. However, some generic search engines also should be ranked as TSEs, since they include both paid and unpaid links to travel sites and maintain "travel" pages, often accompanied by original editorial content. This category of generic search sites includes About.com, AOL, MSN, Yahoo.

Meta-search sites

These sites use technological tools to “scrape” or scan other travel sites, including third-party travel agency sites – such as Expedia.com, Orbitz.com and Travelocity.com – and branded sites maintained by individual travel companies, such as Delta.com, Hilton.com, or Hertz.com, for example. This category was largely established by companies with executives with technological experience. Examples of meta-search engines are Dohop.com and others that searches both OTAs and airlines in order to find the best and cheapest combination of flights available.

Aggregators of "hot deals" and "special fares"

These sites collect and publish bargain rates by advising consumers where to find them online (sometimes but not always through a direct link). Rather than providing detailed search tools, these sites generally focus on offering advertised specials, such as last-minute sales from travel suppliers eager to deplete unused inventory; therefore, these sites often work best for consumers who are flexible about destinations and other key itinerary components. This category was largely established by companies with journalistic pedigrees and includes Bestfares.com, BookingBuddy.com, Cheapflights.com, Travelzoo.com, and USAToday.com’s travel listings.

Destination aggregators

Such sites often provide specific editorial content, such as user reviews of travel products or detailed destination information. In some ways, these sites are similar to non-Internet media, such as newspapers or magazines, in that they provide news alerts and rate advisories, but the burden of surfing to these deals often is left to the consumer. In many cases, the emphasis is on the destination rather than the booking specifics. Whether these reviews and/or recommendations are in any way affected by business agreements with travel suppliers remains an unanswered question in many cases. This category was largely established in the tradition of destination guidebooks and includes Fodor.com, IgoUgo.com, LonelyPlanet.com, TripAdvisor.com, and Yahoo Travel. Within the sub-category of meta-search sites, there is yet another sub-division: 1) sites attempting to woo consumers directly to them; and 2) sites using their technology to power other sites’ search functions.

Setting up a travel portal online

Major cost heads would be:

01. Branding and Advertising

02. Data center (Hosting and technical support)

03. Operations (Front and back office)

I believe these three would account for up to 90% of costs for travel portal. There would be other costs as running Loyalty programs, infrastructure cost etc. I hope this is helpful.

Be prepared for some resistance from airlines, regarding their pricing data. You might have to show some traction or some significant backing for them to provide you with their feeds.

Also if you plan to offer international routes also via your portal, you would have to pay some significant money to the GDS systems like Galileo and Amadeus which store the international airline routes.

for an online travel portal you need a good team of : -

1) Web Designers

2) Web Developers

3) Content Writers

4) Search Engine Optimizers (Online Marketing like PPC )

5) Offile Marketing Persons

6) Customer Support Executives