IN-DEPTH: Interview with priceline.com’s executive vice president - corporate development, Glenn D. Fogel

Published: 02 Jul 2010

IN-DEPTH: Interview with priceline.com’s executive vice president - corporate development, Glenn D. Fogel

By Ritesh Gupta

These are certainly exciting times for the travel sector.

All the talk and even the emergence of new social travel services, the combination of sophisticated mobile devices coupled with location based applications, the possibility of offline navigation with no roaming fees, augmented reality and more of such new features mean the world of travel planning and buying continues to evolve.

As EyeforTravel gears up for one of its biggest events of the year, Travel Distribution Summit North America 2010, to be held in Chicago (13-14 October), we chose to speak to online travel company priceline’s executive vice president - corporate development, Glenn D. Fogel.

Fogel, who is scheduled to speak at the Online Sales and Distribution Conference, spoke to Ritesh Gupta about the emerging trends and the next big thing in online travel. Excerpts:

How do you assess the emergence of location-based applications in the travel industry? The industry has just seen the launch of an iPhone augmented reality application that uses the GPS to determine a user’s location and displays the nearest airports from which one can access great deals. For its part, priceline.com, too, came up with a new version of its Hotel Negotiator App which allows travellers to point their phones in a desired direction and the radar sweeps the area looking for hotels.

Glenn D. Fogel: We believe that location based applications will become more and more important over time. The combination of sophisticated mobile devices coupled with location based applications opens up a world of possibilities.

What neither we nor anyone really knows is how this technology will play out.

Do people want discount coupons from a Starbucks as they walk past it? Do people want marketers to know where they are? Some of the time? All of the time? None of the time? Over time, there will be many different business models and a few will bubble up to the top. We just don’t know which ones these will be yet.

Malaysia Airlines recently introduced the world’s first kiosks to sell airline tickets using the Apple iPad. Apple recently sold its three millionth iPad, just 80 days after its introduction in the US. How do you assess the role of technology and gadgets for additional sales channels and driving customer loyalty in the time to come?

Glenn D. Fogel: We do not believe that gadgets or distribution technology makes that much difference in terms of total travel spend worldwide.

However, a business’ performance can be impacted by changes in technology. A simple example is the decline of the brick and mortar travel agencies after the web developed. Now, does that mean if a business does not have a native iPad application, it’s doomed to fail? Doubtful. And on the other hand, if a business spends too much time on the latest/greatest gadget, it could seriously mis-direct resources. It is an interesting dilemma: How much attention / money should one spend on emerging technology? Unfortunately, there are no obvious answers and mistakes can be grievous down the road due to path-dependent development.

Which major trends do you foresee as far as customer engagement via various devices or web platforms is concerned?

Glenn D. Fogel: The whole location based eco-system is interesting because in the past the travel company was the primary organisation that “knew” where the traveller was at any particular time. So, for example, one could market local products or services to a traveller who was going to a particular place and be paid for those sales.

Now, anyone will be able to do very tight local based marketing when the traveller is on his trip. Essentially, information (which has a value) was “owned” by the travel company and now this information will be much more accessible.

Online travel companies have been trying to create tools that work in the organic way people like to think about travel. A lot is being said about fuelling ideas, inspiration or even bargains/ deals. How do you assess such efforts at this juncture?

Glenn D. Fogel: We concentrate on getting customers the best price.

We believe that, by the time they visit us, they know what they want and are now looking for the best deal for their latest travel inspiration.

Browsing content is a critical part of the research phase, however travel businesses must get better at communicating their unique value proposition or generating urgency in the buying process. How do you assess the need to improve upon this facet of business? Also, what can we expect from all the efforts which are moving towards personalisation?

Glenn D. Fogel: Personalisation is important in terms of being more efficient in communicating a message to a customer that is relevant. And perhaps the most important message we send to a customer is that we will provide the lowest price available. Now what is critical is to make sure the lowest price is related to something that a particular customer is interested in. It does no good to send a message about a low cost trip if the customer has no interest in that particular destination.

Going by the developments in the recent past, what do you think will be “the next big thing” in online travel?

Glenn D. Fogel: I do not know if this should be considered the next “big” thing, but I am looking forward to more RFID (radio-frequency identification) technology.

I don’t like wasting 10 minutes checking into a hotel, and having an RFID programmable chip in my mobile device that acts as an electronic key will save me time. Also, checking in at the airport by just holding my mobile RFID programmable device to a scanner will also save me time.

Another thing that I saw recently was an airline handing out iPads as personal entertainment devices for the duration of the flight. This is much better than even the most sophisticated in-flight systems. Finally, I look forward to in-flight wi-fi connectivity to the Internet on any flight at any time during the flight.

Over the past 18 months or so, online travel companies proved their worth by helping to mitigate weak demand by pouring resources into marketing, promotions, and offering value pricing to the leisure traveller. OTAs also came up with several initiatives related to fees and price guarantees. Overall, how have OTAs changed the game and how has the distribution game changed overall?

Glenn D. Fogel: I do not think there has been much change over the last 18 months versus a few years earlier. Yes, during economic downturns distributors like OTAs get access to more inventory than during high times and at lower prices, but this has always been the case.

Hotels and airlines think differently about the utility of mobile phones. For instance, according to a group like Intercontinental Hotels, booking – especially last minute bookings – along with pre stay planning and in market arrival can be natural fits for the mobile channel. On the other hand, airlines say selected selling opportunities will come later. Displaying offers via mobile would be useful but better to focus on click to call to pop customers to call centres rather than forcing them through 5-6 stage mobile booking funnels. What do you have to say from an OTA perspective?

Glenn D. Fogel: I don’t think there is an OTA versus supplier difference here. Everyone agrees that multiple pages make booking more difficult. And if the data show that click to call is better than having people stay on a 100 percent web path, then that is what everyone will design their sites to do. And it is not at all surprising that most mobile web bookings are same day.

If one has a 17” inch video screen versus a mobile device, most people would choose to use the bigger screen. But when one is traveling, by definition one is away from one’s home or office web device so one must use the mobile instrument. However, we have been told that some people enjoy using the priceline iphone app so much they do use it rather than their PC. So perhaps what is most important is designing a mobile app that is appealing, which we think we have done.

Travel Distribution Summit North America 2010

priceline’s executive vice president - corporate development, Glenn D. Fogel is scheduled to speak at the forthcoming Travel Distribution Summit North America 2010, to be held in Chicago (13-14 October). The two-day event will feature over 60 speakers, including the ones from Hilton, Wyndham, Travelport, Lufthansa, Expedia, Google and from many other such organisations of repute.

For more information, click here:

Or contact:

Marco Saio
Event Director
marco@eyefortravel.com
0044 (0) 207 375 7219

Or

Rosie Akenhead
Event Director
rosie@eyefortravel.com
0044 (0) 207 375 7229