As the online travel search market gets crowded, a media report has indicated that the "smaller entrants without partnerships with major service providers are sure to fail."

Published: 24 Nov 2005

As the online travel search market gets crowded, a media report has indicated that the "smaller entrants without partnerships with major service providers are sure to fail."

According to Reuters: "Unlike full-service online travel agencies such as Expedia Inc. that sell tickets and make reservations, travel search engines sniff out bookings and direct users to Web sites where they can make purchases. Some travelers use search engines to avoid booking fees that travel agencies charge. The newest breed of these businesses are the so-called meta-search sites that present users with lists of bookings for comparisons."

As per the report, the "trouble is that too many sites are doing the same thing and too few travelers care", according to Henry Harteveldt at Forrester Research. "There is a glut. They're not working," Harteveldt reportedly said. "Our research indicates these meta-search sites just aren't gaining any traction."

According to a recent by JupiterResearch, travel search engines such as SideStep and Kayak remain relatively new and have not yet gained sizeable traction. Supplier web sites have not yet seen their sales significantly impacted by these search engines.

Reuters report added: "Experts say the travel search market is reaching a point where competitive pressures threaten to smother start-ups before they can get a toe hold."

"I think it's going to be a lot tougher road for some of the new companies to try their hand at travel search," Phil Carpenter, vice president of corporate marketing at search engine SideStep reportedly said. "I think it's getting really challenging for new players to enter the space." Carpenter reportedly said the key to success is in partnerships with big-name travel suppliers and other travel service companies. Only then will users be confident that they are getting access to the best deals possible, he said.

The report added: "Meanwhile, online travel agencies such as Expedia and Priceline.com, which made their reputations locating cheap fares, are adapting to the new competitive environment by personalising research and bookings instead of relying solely on finding low prices. The agencies hope to expand their businesses by addressing all travel needs and making recommendations."