Travelore News: Expedia Completes Acquisition Of Orbitz

BELLEVUE, WA - Expedia, Inc today announced that it has completed its acquisition of Orbitz Worldwide, Inc, including all of its brands and assets, for $12.00 per share in cash, representing an enterprise value of approximately $1.6 billion. With the completion of the transaction, Orbitz Worldwide, Inc. stock is no longer being traded on the New York Stock Exchange.

"We are pleased to welcome Orbitz Worldwide to our family of leading travel brands," said Dara Khosrowshahi, Expedia, Inc. Chief Executive Officer. "Our mission is to revolutionize travel through the power of technology. Given Orbitz's focus on transforming the way consumers around the world plan and book travel, we couldn't be more aligned. As we bring our talented teams and capabilities together, we will be well positioned to accelerate the pace of innovation to deliver even better customer experiences to Orbitz's loyal customer base and to further enhance the marketing and distribution capabilities we offer to our global supply partners."

Frequent Fliers Check Travel Sites, Then Buy From Airline Sites

Frequent business travelers favor airline websites to book a flight but are open to using online travel agents' websites if they improve.

(Photo: Kayak.com)

 

Frequent business traveler Dennis Morris of Fox Island, Wash., uses a three-step process to book a flight online.

He finds a desired flight and a fare at an airline website, compares the fare with those cited by Expedia or Kayak and, if fares are comparable, returns to the airline website to book the flight.

"I prefer to work directly with the airline in case changes or issues come up," explains Morris, the CEO of a boat manufacturing company and a USA TODAY Road Warrior who volunteers travel information. "My experience dealing with non-airline sites is that, if issues arise, addressing them is much more difficult."

Many travelers like Morris favor airline websites, according to a survey released Monday by FlightView, which sells travel apps for mobile phones and daily travel information for airlines, airports and technology companies.

The survey — based on 2,066 people who used FlightView's mobile app in April — reveals that 36% "typically search for" airline tickets on airline websites.

Twenty-nine percent say they typically search for airline tickets on websites of online travel agents such as Expedia and Orbitz, and 22% say they use travel search engines such as Kayak and TripAdvisor.

Most survey respondents — 59% — say they usually buy their tickets from airlines. Nearly 30% buy them from online travel agents, 8% buy them from traditional travel agents and 3% say they don't book their own travel.

The survey also shows that —like Morris — travelers routinely go to non-airline websites to gather price or other flight information before using an airline to book a ticket.

Forty-one percent of respondents say they "sometimes" go to non-airline websites to get such information; 29% say they do that "most of the time," and 19% say they "always" do that.

For business travelers, the results show that they "are incredibly connected and have hundreds of travel tools, mobile apps and services at their disposal," says FlightView CEO Mike Benjamin.

"The choice to use one over another often comes down to the experience that the travel provider offers, and how well the provider keeps business travelers informed and engaged during their trip."

Road Warrior Ashok Adur of Parsippany, N.J., is one business traveler who uses various Internet tools.

"For work-related travel we have been asked to go to orbitzforbusiness.net," says Adur, who works in the plastics industry. "For other travel, I use different websites —airline, TripAdvisor, Expedia, CheapTickets, Bravofly or Kayak."

FlightView's survey shows that the most popular travel websites for "first searches" are Expedia and Kayak.

They were cited by 27% of respondents, followed by Travelocity (12.5%); Orbitz (11%); Priceline (5%) and TripAdvisor (4%).

Boston-based Road Warrior Tom Kelly says he uses Kayak or Google Flights first, then books a ticket on an airline's website.

"Sometimes Kayak will have better flight combinations that are not available on the carrier's site," says Kelly, a supply chain manager in the aerospace and defense industries. "I also like the trending charts and flexible date options on Google Flights. You can also search by airline marketing alliance or see prices for regions on a map."

FlightView's survey shows that 46% of respondents say they would be more willing to book a flight with an online travel agent if they were assured they would automatically be rebooked on another flight if their original flight was canceled. Forty-two percent say they would be more likely to book with an online agent if the agent made it easier to manage their travel itineraries on a mobile device or a website.

Adur says he never uses online travel agents' mobile apps, because some "are limited, especially for multiple flights and complicated travel itineraries."

He likes to use airlines' mobile apps, but they don't always work, and some have "limited capability."

Morris says he doesn't use airlines' mobile apps to book flights for several reasons, including problems with connectivity, speed and "readability for long or complex bookings."

He uses airlines' mobile apps "fairly regularly" after a booking is made, though, for changing a seat, flight status or check-in.

Find cheap fares

George Hobica of Airfarewatchdog.com offers some tips for travelers searching online for low airfares.

• Many airlines have private sales, reserving their best fares for their own websites.

• Check the websites of online travel agencies.

• If your travel dates are flexible, try a flexible-date search. Kayak.com has a good flexible-date calendar that can be used when you register at the website.

• Search often, because fares fluctuate throughout the day, and the number of seats offered at the cheapest fares changes frequently.

• Sign up for airfare alert e-mails, which are provided by many travel websites.

Contributed by Gary Stoller, www.usatoday.com

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Orbitz, Expedia and Hotels.Com Sweeten Reward-Points Deals To Keep Travelers From Just Browsing; Credits Offered Up To 10% Of Booked Travel

Users of the travel site Orbitz could get credits, or Orbucks, worth 10% of what they spend on hotels and 7% on airfare, unusually high totals. 

Now is the ideal time to load up on loyalty points—good for hotel stays, rental cars and airline tickets.

Savvy travelers can get two or even three times the points for one reservation, thanks to a brewing battle between travel websites Orbitz,  which unveiled a major escalation of the customer payback this week, Expedia  and Hotels.com. Even infrequent travelers can collect booking-site points on top of airline miles and credit-card paybacks, and sometimes double-dip on hotel points, too.

Why the big kickbacks for consumers? Many travelers use online travel agencies to compare prices, but when it comes time to buy, they go directly to the airline or hotel they want. Online travel agencies used to charge booking fees, giving consumers an incentive to buy elsewhere. But they dropped most of their fees several years ago. The bet now is that fat rewards will turn browsers into buyers.

Hence, the deluge of points: Book a trip on the Orbitz website, and if you are a member of Orbitz Rewards, you'll get back 3% of every dollar spent at a hotel and 1% for airfare. Book it using an Orbitz Visa  credit card just launched on Tuesday and you get 8% back on hotels, 6% on airfare and 6% on packages, plus 2% of anything else you buy with the credit card. And if you book using a mobile device, you can get an extra 2% back on hotels and 1% on airfare.The online sellers face all kinds of competition from referral sites like Kayak.com that search multiple sites and then direct you to the deal you pick, and from startups that offer unpublished discounts and nontraditional stay options like apartments, spare rooms and even living-room couch rentals.

The rewards are paid in Orbucks, which can be redeemed instantly for hotels booked on Orbitz. This means you could get as much as 10 Orbucks if the $100 was spent on hotels and seven if it was spent on airfare. One Orbuck can be redeemed for $1 off a hotel room.

A total of 10% credited back on hotel spending and 7% on airfare is unprecedented in the low-fare, tight-margin world of travel bookings, especially when it can come on top of regular airline miles you earn and in many cases hotel program points as well. That's far richer than most airline awards, where you typically get one mile for every mile flown and then redeem the miles for awards, with the average traveler getting about 1.5 cents for every mile earned. And you don't have to give up one for the other.

Hotels.com offers a de facto 10% back on hotel bookings by offering a coupon for a night's stay after every 10 nights bought through the agency. The coupon is worth the average price paid for the 10 nights (excluding taxes and fees).

Enlarge Image

A Visa credit card from the travel site Orbitz that launched this week allows users to build up reward points more quickly. Orbitz

Most vendors don't offer generous loyalty points on airfare because airlines don't pay them much in the way of commissions. Expedia Rewards offers two points for every dollar spent on a hotel, but only one point for every $5 spent on airfare.

"It is aggressive," said Orbitz.com President Chris Orton. "We want to make sure this is a really serious component of our business."

The American Consumer Satisfaction Index, published this week by the University of Michigan, showed online travel agencies had the highest satisfaction scores among travel industries. (Airlines had among the lowest scores of any industry.) But consumers still said they preferred to book directly with airlines and hotels.

"This is a way to lock the consumer into booking with the OTA," or online travel agency, said Henry Harteveldt, a travel analyst and co-founder of Atmosphere Research Group. "OTAs are certainly very serious about remaining strong competitors."

Orbitz says customers in its loyalty program typically book more transactions than customers not in the program and are 20% more likely to buy four- and five-star hotels.

Despite the rich rewards, many consumers just focus on getting airline miles, and sometimes hotel points, when they travel. Online travel agencies think by offering richer rewards they can get more consumers interested in double-dipping and even triple-dipping points.

"It's becoming increasingly popular, but I don't think everyone knows it exists," said Sarah Gavin, Expedia's senior director of marketing.

Online travel sellers are weighting their rewards to drive more hotel bookings, which are far more lucrative than airline bookings. Some hotels offer rooms at deep discounts and let online travel agencies price them higher and pocket the difference. Some pay commissions of 15% to 20% for room bookings, analysts say. Expedia says 71% of its 2013 revenue came from hotel bookings.

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Many hotels won't pay points in their own loyalty programs when you book through an online travel agency, depending on the contract between the hotel and the agency. Consumers often don't know if they can double-dip on hotel points until they check in—it can vary even by individual property. But travelers routinely report that they get hotel points anyway from hotel companies when they give the desk clerk their loyalty program number.

Consumers are often loyal to a particular airline for frequent-flier miles, yet agnostic about hotel brands, shopping by price, location, ratings and reviews. The loyalty programs of the booking sites give hotel benefits regardless of brand and let you earn points at independent boutique properties.

To make its program more appealing last fall, Expedia doubled the rewards it pays on packages to two points per dollar spent from one. It also started paying points for booking other tourist activities through the site, such as tickets to Disney World, and began offering 500-point bonuses for booking with mobile devices.

Consumers who book with mobile devices tend to book closer to when they travel and are more certain to buy than just shop, so sites like Expedia are eager to drive customers to mobile devices. Once consumers get a booking site's app, they are more likely to stay loyal to that site. Expedia is so eager, it is temporarily offering triple points on top of the 500-point bonus for mobile bookings. Expedia also reduced the minimum number of points needed to redeem a discount certificate to 3,500 from 7,000. For 3,500 points, you get a $25 coupon.

Hotels.com says it has 10 million people registered for its Welcome Rewards program. Many customers use the credit they earn after 10 stays to buy a more expensive room and pay the price difference, the company said.

Milton Lai, senior director of global loyalty, says the program has paid out about 2 million free nights since it began in 2008. "Giving 10% back is not cheap at all," Mr. Lai said. "Based on research, we were banking on getting enough repeat business back to cover the cost, and we've been able to do that."

Contributed by Scott McCartney at middleseat@wsj.com

Travelore Tips: How To Save Money When Booking Travel Online

Websites like Expedia.com, Hotwire.com and Orbitz.com have all but eliminated the need for travel agents -- why pay someone to compare flight durations and room rates when you can do it yourself? The problem is, if you're not careful, you may end up paying more in the long run. Finding a good price online (especially during the holiday season) requires diligence and patience, not to mention a great deal of savvy. To help you get the most bang for your buck on your next DIY travel booking, we persuaded CheapAir.com CEO Jeff Klee,Getaroom.com and Hotels.com co-founder Bob Diener, and Airfarewatchdog creator George Hobica to divulge their own travel booking secrets.

wwarby / Flickr

1. Get Online

Though this may seem obvious, the only way to score the best rates is to spend a lot of time on the Internet. When looking for available flights and hotel rooms, the more research you do the better. "The most important thing is to check fares often," said Klee. He notes that airlines usually have 10 to 15 different price points for any flight, meaning that rates can change at any time. Start researching your trip well in advance to get a feel for the going rates -- that way, you'll know a good deal when it comes along. But be prepared to act fast. "While everyone wants to get a good deal, you can't obsess about finding rock-bottom prices," Klee said. "Once you see a good deal, grab it. If you see a good deal during the day, there's a very good chance that it will change by evening."

2. Check Your Email

Because it's impossible to stay on top of every rate change, Hobica recommends setting up email alerts on sites like Kayak.com or using tools like Hotwire.com's Trip Watcher, which will let you know when prices drop. "But you have to check your email," Hobica said. "Someone might be holding the last seat at the lowest fare and then not buy it, which puts that lower-priced seat back on the market." Meanwhile, tuning into airline, hotel and deal-centered Twitter feeds and following travel-focused Twitter chats can increase your chances of catching a flash sale, especially if it's not advertised. According to Diener, you can save up to 60 percent on hotel rooms should you happen to spot a flash sale. By following Airfarewatchdog, Getaroom.com or Hotels.com on Twitter, you'll have a better shot at catching a price drop as soon as it happens.

3. Be Realistic
If you start researching flights and hotel rates several months before you plan to travel, you'll be able to recognize reasonable prices. But all bets are off when it comes to peak travel times, like the holidays: Don't expect a flight to cost the same right before Christmas as it did back in April. "Holiday flights are more expensive than everyday flights," Klee warned. "Don't get sticker-shock and wait longer to book in hopes that the price will drop, since you could end up paying more." The same goes for winter trips to warm-weather destinations. Diener explained that because the majority of Americans live in colder climates, the demand for hotel rooms in warmer places like Miami or Phoenix skyrockets. But deals can be found as long as you start your room search early. "Popularity means the best deals at the best hotels will be picked up quickly," he said. "Don't wait until a few days before your trip to book a hotel."

4. Be Flexible

If you're willing to be a little loose with your travel plans, you'll have more flexibility when it comes to price ranges. This is particularly true around the holidays: A survey conducted by CheapAir.com shows that travelers saved an average of $249 per airline ticket simply by shifting their Thanksgiving travel dates to depart the Monday before the holiday and return the Tuesday after. However, conducting research on flexible travel dates isn't as easy as it used to be. "A lot of booking sites have eliminated flexible search," Hobica said, stressing that you should spend extra time looking at prices both on booking websites and directly on airline websites. It's more work, but Hobica insists that it's worth the effort. "It may be cheaper to fly United there and Virgin back, but the Virgin website wouldn't show you that," he explained.

Also, extending your trip by a day or two can yield significant savings on hotel rates. "Always check for a three-night stay because lots of hotels give much better rates when booking three or more nights, rather than a one- or two-night stay," Diener said. He also suggests aiming for a Sunday night check-in; room rates drop as weekend lodgers leave.

5. Forget the Rules

How many times have you heard that booking on a Tuesday night will result in lower airfare? Or that flight prices will not drop after a certain point? "It's all nonsense," Hobica said. "Look at it logically: If everyone followed the rules, the airlines would manipulate you." Klee noted that you will generally find the best rates between four and seven weeks before you plan to fly, but the day you book doesn't matter. "Airlines tend to offer sales on Tuesday, but most people aren't going to get those seats anyway," he said, noting that airlines only offer a select number of bookings at those sale prices. What does matter, however, is when you plan to fly. Klee advised taking off on a Tuesday or Wednesday, as Friday and weekend departures are in higher demand.

Being strategic when choosing your travel dates is especially crucial around the holidays. The key is to work around the normal travel times: CheapAir.com's survey shows that travelers saved $200 on Thanksgiving flights by booking a Monday-through-Friday flight instead of a coveted Wednesday-through-Sunday trip. And opting to fly on Thanksgiving or Christmas Day (when no one wants to travel) will no doubt slash your expenses.

6. Don't Assume It's Too Late

Yes, you will have better luck finding reasonable rates the earlier you book. But Hobica believes in not giving up, especially when it comes to holiday flights. "If a fare was way too high for your pocketbook, you should jump back into the pool a few weeks before Christmas," he said, noting that airlines may drop the cost of unsold seats in order to fill a plane. Just don't bank on convenient options, as the more desirable flights will surely be sold out. You're more likely to come across bargain airfare on red-eye flights or inconvenient departure times. "It's like shopping at Marshall's," Hobica said. "They may have what you're looking for in your price range, but only in an extra small. If you can make it work, then go for it."

7. Read the Fine Print

When booking flights and hotels online, reading the fine print is crucial -- whether it's the terms of your ticket or the terms of the website. You may book a flight on Spirit Airlines and plan on obtaining your boarding pass from the gate agent only to find that you'll be charged an extra $10 per ticket for not printing at home. Or you could end up reserving a hotel room only to find that the booking website doesn't include additional taxes or fees in the rate, like Expedia, and the price isn't quite the bargain you thought. Before you hit the "Purchase" button, make sure you know exactly what you're getting for your money.

8. Make Sure Someone's Got Your Back

The best advantage a travel agent offers is that he or she fights for your rights should something go awry with your travel plans. If you prefer to do things yourself, Klee said you need to make sure that you are using online services that provide reliable customer support. "That way, if you're in a bind, you can get help more easily." Sometimes, booking websites will absolve themselves of any responsibility should the unexpected happen (which is why you should pay attention to tip No. 7), which can lead to an unexpected, often lofty set of cancellation or change fees. Purchasing flights and hotel rooms through a reliable third-party booking site will grant you access to a customer service team that can negotiate with the airline or hotel on your behalf, saving you time and money.

--Contributed by Miriam B. Weiner