In a claim almost guaranteed to irk its noisy critics, TripAdvisor reckons that page views of its content (ie. reviews) had some influence on £1.7 billion worth of business in 2011.
The study commissioned by the user review giant with market analysis company Tourism Economics (a division of the respected Oxford Economics) says the £1.7 billion figure is just over 2% of total tourism spending in the UK over the course of last year.
Over a quarter of users stayed in a destination for a longer period of time, spent more money or booked more activities as a result of TripAdvisor, the report claims.
Furthermore, the level of spend “supported an estimated 20,000 jobs within the tourism industry and a total of 42,000 jobs were associated with TripAdvisor in 2011″.
This includes what TripAdvisor says are “indirect effects through the supply chain and the induced effects of employees earnings”.
“A significant proportion of these jobs would not exist apart from TripAdvisor while other supported jobs and economic activity involve some redistribution of resources.”
In another claim, average domestic spending per trip by visitors to the UK site was estimated to be 20% higher than the average online booking.
How on earth did TripAdvisor and Tourism Economics come to these conclusions?
Tourism Economics says it analysed data from the site during May 2012, looking at page views and booking conversion rates which were then compared to existing economic models for the UK travel industry.
The data was combined with the results of another TripAdvisor-commissioned user survey to look at the impact of user generated content sites on the travel, tourism and hospitality industry.
So it looks like TripAdvisor is not only a major influence on the purchasing decisions of consumers but is also trying to position itself as a force for economic good, a message more than likely also aimed at those interested in the company since it listed on the public financial markets in 2011.
While there is an attempt to reinforce the former in some of the messaging in the study (“TripAdvisor and sites like it tend to provide reassurance, build trust and provide more information”), proclamations about its role in the tourism economy and processes affecting the industry and, in particular, hotel distribution are likely to be met with scepticism.
For example: user review sites “level the playing field”, TripAdvisor says, “with more than half of survey respondents reported finding on TripAdvisor hotels not part of a chain.”
One of the report’s authors, David Goodger, a director at Tourism Economics, says site such as TripAdvisor have “fundamentally changed the way consumers both research and shop for their holiday and leisure activities, to their benefit”.
“Travel consumers can now afford to be more selective in their purchasing decisions which has really seen those providing a quality product or service in this industry rise to the top.”
NB: Money rain image via Shutterstock.
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About Kevin May
Yuo have to accept that TA is a remarkable thing. I use it myself and it IS really useful. But the research feels a bit partisan doesn’t it? A good slathering of PR cream on the top of it all?
I would rate this survey as a 34 out of 76 possible surveys in this area.
I myself am associated with £3, 456 worth of beer consumption in the last 18 months. Add in my friends and combined we are associated with over £15k worth of booze consumption in the last 9.5 months. I did economics at Uni and I wasn’t very good at it. But I can’t remember “being associated with” as being a pure economics term, although I suppose it is…
You know who loves surveys like this – Public Affairs people. The rest of us treat them with a large soupcon de sel…
ps. The Front desk people were very grumpy at check-in.
This reminds me of the Expedia billboard effect study by Cornell a few years ago (which was sponsored by Expedia), which claimed credit for millions of dollars worth of hotel bookings in the US. Expedia turned around and used those results to further squeeze their hotel partners, but the methodology used, and results presented, remain in dispute.
Attribution of user behavior to a single source is like alchemy – it can’t be credibly replicated but those who claim to have seen the process swear by the results.
Anecdotally speaking I would say that there’s little doubt that reviews do influence decision making. Instead the scepticism, as the article suggest, is more in quantifying this, and (given that TA is synonymous with reviews in travel) TA’s not so subtle implication that therefore it is force of good.
My interest is more tangential. Whilst TA is synonymous with reviews in travel, that doesn’t necessarily equate it to quality. It holds the top spot because it’s long established, had the first mover advantage and the accumulation of reviews since makes it difficult to topple. For me the value of reviews is undeniable, so the more important question is when will a more quality service provider come along and provide a higher quality service (and with it a means of offering reviews that are less contentious)? In other words, I see TA as the Excite search engine in the lat 1990s and I’m waiting for the Google equivalent to take over it.