Australians work hard, day in, day out, counting down the days until their next holiday. But how do we choose where to go next and, importantly for the marketer, with which company to spend our hard-earned holiday dollars?
Australians increasingly book travel online
More of the 19.6m plugged in Australians are shopping online, with 20% shopping at least weekly via their PCs, 10% via a tablet and 11% via a mobile. These consumers make up the lucrative online travel booking market in Australia, which has current annual revenue of $728m and annual growth of 13.8% averaged over the past 5 years.
Australians typically book their online travel with one of the three biggest websites: booking.com®, Expedia® (Australia) and webjet.com.au®. These sites aggregate available hotels or flights, and rank according to attributes such as price, recommendations or class.
According to a recent GE report, consumers feel that digital tools such as these empower them to compare prices and find the best value. Consumers also like to thoroughly research – Adam Singer from Google analytics tells us that the average person consults 10.4 sources of information prior to making a purchase. These sources include user review sites such as Trivago® which boasts ‘more than 200m reviews from unbiased travellers’.
But how to decide?
But this wealth of information comes at a price. Consumers need to spend much more time and energy to narrow the consideration set and make a decision; and decisions become more difficult as the number of options increases (Broniarczyk and Griffin, 2014). Even worse for the consumer, research has found (Diehl, 2005) that although the internet makes searching easy, provides a greater selection, and provides the ability to screen options and sort preferences, this may not expose the consumer to the best options, and it may lower the quality of their decisions, resulting in the consumer making bad decisions. The marketer suffers too, as consumers that are faced with too many options may either delay their decision to purchase, or (gasp!) avoid making a decision at all.
So how do online travel providers stand out from the crowd, increase awareness, and entice the traveler to make a purchase, ideally leading to repeat purchases and creation of loyal ‘brand-fans’?
Market an Experience, not a Service
A 2015 PWC report that investigated the behavior of over 19,000 consumers across 19 countries including Australia encourages retailers to ‘create unique brand-defining experiences that keep customers coming back’. This is in keeping with Joseph Pine’s advice that marketing must progress from selling services to experiences to keep the consumer coming back for more.
Buy creating an experience, it is much more difficult to compare offerings from different providers, allowing marketers to cut through the enormous list of options, making the decisions easier for the consumer and differentiating from their competitors.
Luxuryescapes.com, a division of Aussie Commerce, is doing just that. No longer offering just a discounted hotel room, or hotel + flight package with an enticement of an airport transfer, they offer a complete experience. Their packages typically include not just a heavily discounted luxury room at a highly rated hotel, but dinners, massages, tourism experiences, cocktails, as well as the obligatory airport transfer. On top of that, they are clever to limit the availability of the package (window of availability for 1-2 weeks) and the number of offerings at any given time (about a dozen), which facilitates consumers making a decision to purchase.
Luxuryescapes.com also leverage the all-important user review by prominently displaying awards received by the hotel and commissioning known travel commentators (Livinia Nixon) to give reviews:
Luxuryescapes.com is just one of the many ‘experience’ sites marketed by Aussie Commerce. Aussie Commerce was rated #12 in BRW’s top 100 fastest growing companies in 2015, and it is easy to see why.
Other online retailers would be wise to take a close look at this model and consider how they can move from merely offering an easily comparable product or service to a complete experience for the consumer. And then watch the sales grow.
Broniarczyk and Griffin, 2014 ‘Decision Difficulty in the Age of Consumer Empowerment’ Journal of Consumer Psychology vol 24 (4) pp. 608–625.
Diehl, K 2005 ‘When Two Rights Make a Wrong: Searching Too Much in Ordered Environments’ Journal of Marketing Research, vol XLII, pp. 313-322.