TV advertising is clearly the new black -- or at least it is throughout many parts of Expedia Inc where a new ad for Hotels.com is being launched in the UK this week.

The ad features the voice of Martin Clunes, who some will remember from TV sitcom Men Behaving Badly and drama Doc Martin.

Marketing officials at Hotels.com say the ad will run on the main UK commercial networks as part of a three-part strategy, the final segment coinciding with the FIFA World Cup in South Africa.

The launch of the Hotels.com ad comes just weeks after mothership Expedia began rolling out its Building Blocks ad across Europe, voiced in the UK by another comedy writer and actor, David Mitchell.

Hotels.com is stepping into new territory with the release of a bizarre new product to showcase some of the major destinations featured on its US site.

A surreal mash-up between a promotion, game and trip planning tool, VirtualVacation is a microsite bolted on to Hotels.com that allows users to explore ten cities in the US by combining webcam technology with live interaction and storytelling.

User interact via webcam motion detection with a microphone pick-up to move and interact with 3D images of cities including Los Angeles, Seattle, New York and Las Vegas.

Such features include changing the Hollywood Hills sign to that of the user, checking -- and seeing -- local weather details and sending postcards to friends through social networks.

The entire sequence is hosted by Hotels.com’s animated spokesman, Smart, with links back to the main Hotels.com website for booking and use of existing tools.

There is actually only one proper way to illustrate this idea -- watch the demo:

The future of online travel is that the industry is moving from a transaction fulfilment model to platforms, systems, content and technology that cover the whole spectrum of the travel cycle/funnel/bow tie.

This is to incorporate inspiration, recommendation and discovery into the online consumer experience as much as transactions.

After 15 years of online travel being about online transactions, we are moving from answering closed questions (“How much for a ticket to New York?”) to answering open ones (“Where should I go next?”).

For consumers to get an answer to an open-ended question it will be necessary for them to use a booking or query widget that does not require the customer to know where they are going.

To start the online travel process from a search box based around something other than selecting a date and destination (the traditional online travel agent starting point).

In the last year I have met a number of startups and mature companies building, launching and promoting travel sites exploring this area. And through this I have spotted four approaches to non-destination base search.

1. Drag, click, build and recommend from as many sites as you like

The use of plug-ins or apps to build up a trip idea, notion, inspiration and plan without actually having an engine at all.  By just dragging ideas from a site to a planning product.

Add links, add comments, add thoughts, share with others and build up from a broad notion to a detailed plan.

Gliider is very active in this space. They have a tool for collecting, collating and sharing travel plans using a plug-in that follows you while you surf.  It has taken search off one site and allowed all sites to be used in one experience.

2. Multi-click criteria selection

Using something other than a destination but still requiring a click and selection.  Instead of clicking on a destination these sites are getting consumers to start the inspiration or shopping experience using different criteria like:

• Date – Joobili wants a date first, eses the time period you want to travel in as the starting point for trip inspiration (Joobili founder interview);
• Experience ranking/rating – Asking consumers to rank in some sort of order a traveller’s holiday activity preferences. Triporati wants consumers to start with a stack ranking of up to 64 interests.  Tripbase is trying a different angle with a slider on five variables.
• Price – the ability to search based on budget first is being talked about but we have not see it. Planetism (Alpha presenter at the PhoCusWright Travel Innovation Summit in 2009) is still just a static page. Cost4travel has launched and I am expecting more sites to emerge in this area.
• Images – Hotels.com have been trialling their hotel visualiser were search starts with pictures and images (Alex Bainbridge has some detail).

3. Organisation and history first

Instead of starting with a search box, in this category sites start with the bookings already made by travellers.

Providing travellers a service for collating and storing all the bookings made on various sites. Currently this is being used to provide a travel management service and social networking space.

In time, this will expand to a recommendation service as players in this space collect more and more historical information about traveller behaviour – opening up a powerful data mining and merchandising resource.

TripIt is the first in this space and a tool I used with every trip (product review). A place to store and share all travel information with tracking and sharing tools.

Traxo has entered this space focused more in the leisure sector by building login in links to the major OTA customer information screens.

Allowing them to access a traveller’s account details directly from the OTA. Nokia’s Dopplr is coming from a more networking and “where are my contacts” approach but they too are collecting historical information about a traveller’s habits and desires. Tripcase scored a lucky break in this tight start-up battle when they made their way into iPhone app advertising.

While none of these sites are aggressively moving into the recommendation space – it is only a matter of time before they use the collected data for directing consumers to purchase paths.

4. No search – just a push

The latest version of non-date or non-destinational search sites are those with no search at all.  Sites with no mechanism for conducting any form of search of investigation.  Just a limited list of deals targeted at a select user group.

Playing on the strength of the user base and the ability of the company to select the right deals for the user base.

Biggest example is the Gilt-backed Jetsetter (interview with CEO). Start-ups are emerging regularly in this are. I have an example even closer to (my) home when some ex-Orbitz staff recently launched BonVoyou.

It is far too soon to call the death of the date and destination based search interface but there is a lot of venture money and start-up energy being spent on finding a new way to search for travel results.

This entrepreneurial push is evidence of the emerging desire from consumers for exploring new ways of exploring different areas of the inspiration, research and purchase funnels.

I predict we will see this start to change the UI, design and flow of the OTAs as they seek to chase this consumer desire and fight off the start up response.

Any other search approaches or companies you have noticed that are trying non-destinational search?

UPDATE: All sites back up… “We did make some critical improvements earlier,” an official says.

And on Twitter:

Original post:

Now either Expedia Inc has something major to announce at its Q1 2010 earnings call later today or a major upgrade was given a rather quirky schedule time.

First look suggests many Expedia sites around the world are currently down.

From the US site:

“Expedia is temporarily unavailable while we improve the travel tools and services that you rely on. We’re sorry for any inconvenience, and thank you for your patience. We look forward to helping you find your perfect trip—be sure to check back with us shortly.”

The UK version of Expedia even offers a handy link to sister site TripAdvisor. Other Expedia sites, Hotels.com and eLong, appear to be operating normally.

Watch this space…

A pundit has the right to cast a critical eye over a business, even if the founders are proven entrepreneurial billionaires.

Robert Diener of Getaroom.com should need no introduction to readers of a blog about the online travel industry.

In 2002, the parts of Hotel Reservation Network/Hotels.com that IAC did not already own were bought and merged with Expedia.

The deal set Diener and his partners up for life and made Expedia the then biggest force in online hotels in the world.

A title – despite the challenges of Booking.com/Priceline, Orbitz and Travelocity – they still hold.

In July 2009 (was there a seven-year non-compete?), Diener announced the launch of Getaroom.com (a pre-Tnooz Dennis Schaal said this about the announcement).

Given the pedigree it was inevitable they would receive a lot of media attention.

On PhoCusWright’s Center Stage in Orlando, Diener was interviewed by Carol Rheem of PCW giving the blog and tweetpit a chance to discuss and critique the GetARoom model.

The business is a twist on opaque pricing and a reversal of the Priceline and Hotwire models.

A consumer looks up a hotel on the getaroom website where prices are clearly displayed.

Then the consumer calls the GetARoom call centre to purchase the room. GetARoom will sell the customer the room over the phone at a price less than the one displayed on the site but will not tell the consumer what the price is (and therefore what the discount is) until after the customer’s card has been charged.

With Hotwire and Priceline you don’t know the hotel’s identity until after your card has been charged. With GetARoom you know the hotel at the time the card is charged but not the price.

For this to work three things have to happen: consumers have to pick up the phone; consumers have to be prepared to give their credit card even though the final price is not known; and hotels have to be prepared to give opaque cheaper rates based on a phone call as a gate.

Let me take you through each of these and tell you why these three elements will happen at a scale insufficient to make this work:

1. Consumers have to pick up the phone: consumers have abandoned the phone for simple transactions such as hotel bookings and point to point air. Especially in the US. It is instant gratification, no-talk booking that is and has driven the online revolution. Driving people back to the phone for a straight out hotel booking seems counter to the rest of the online travel revolution.
2. Consumers have to agree to charges without knowing price: the obvious analysis here is that consumers are going to be reluctant to do anything when price and potentially room type is unknown. Arguing against myself, I could say that credit card hesitation was the largest anti-online travel argument back in the old days and the industry and consumer found a way around that. But in this case it is more than just typical security related consumer CC hesitation. Getaroom is asking consumers to gamble with price. Consumers need significant rewards – beyond the odds rewards – to gamble on price. The less obvious analysis is around credit card charging rules and chargebacks. A chargeback is where a consumer denies a charge levied against their card. The online travel industry has to deal with the challenge of consumers denying charges for transactions without signatures or PIN/code based confirmation. Mastercard Chargeback reason code number 4808 states that a charge can be challenged if…”the transaction was non–face-to-face and was not authorized.”. (manual here).  I can imagine an easy path for a potential customer successfully securing a chargeback by saying “they did not tell me the price. I did not know what the charge was going to be”.
3. Hotels have to be prepared to give opaque cheaper rates based on a phone call as a gate: hotels give deep discounts when they can protect the rates for unfettered booking and thus threatening regular rates. Scores of examples of this – package rates, secret hotels, closed user groups like travel clubs or loyalty groups, group rates and more. Critical to the hotels giving the discounts is a comfort level that the discounted rates are sufficiently hidden from general public access to protect the standard rates. Having to make a phone call does not seem to be a sufficient gate or level of protection to encourage a scale number of hotels to offer discounts. This is especially true for chain hotels. Chains are the number one participators in closed groups precisely because they can product their other pricing channels. If I am right here then either GetARoom ends up with only a limited number of hotels offering discounts or they have to provide discounts by cutting their margins. The first (limited number of hotels) is a bad customer experience. The second (cutting margin) risks hotel anger for breaking Best Rate Guarantee requirement and limiting scope for marketing and technology investment.

But – while there are three reasons why I don’t think Getaroom will work – there is one big reason why it will work.

Last time Diener and team tried to facilitate hotel bookings, they built a company and they sold it for billions.

Appendage:

I need to clarify my comments in point 2 above. The first time I called the getaroom call centre and tried to book a hotel with an unpublished rate I thought that I had to make my credit card available to be charged before knowing the price.  After this post went live a comment was sent to me that said that it  was possible to pull out of the transaction after the price was disclosed and before the card had been changed.  So I called the getaroom call centre again.  In that subsequent call to getaroom it was true that I was able to pull out of the transaction after being told the price.  But it is not a simple “they tell you the price and I say yes or no” sale.   The call centre agent said she would only tell me the unpublished rate (assuming their was one) if she thought I was ‘willing to do the transaction’.  This means she would asses my willingness to transact, take my cc and reservation details, tell me the price and (once I confirm) charge the card.  She made it clear that while I could pull out once she told me the unpublished rate, that she would only tell me the unpublished rate if she was satisfied that I was “willing to complete the transaction”. She would not be any clearer on how to she assessed this willingness – though it became clear that by asking so many questions on whether or not I could pull out that she was putting me in the unwilling basket.

Disclosure: See Hughes’s Tnooz profile – contributor in a personal capacity, views are not representative of Orbitz Worldwide.

The game of gotcha between U.S. cities and the online travel agencies continues and it’s almost a full-time job just trying to keep tabs on the whole thing.

It sort of reminds me of my visit to the Orbitz TLC Center last week, where about nine people, including three former air traffic controllers, were on duty, monitoring plasma screens filled with gridlocked jets and typhoons.

Somewhere, undoubtedly, a team of lawyers is hunkered down in a corporate boardroom, monitoring a torrent of hotel-tax motions, city audits and new ordinances across the country.

Anyway, here’s what’s been going on in the last few weeks as municipalities seek to force the OTAs to pay occupancy taxes on retail rates when they sell hotel rooms on a merchant basis, and the OTAs fight back.

Orbitz quietly has ceased selling hotel stays on a merchant-model basis in Lawrence County, Pa., after the county sued the OTAs over the hotel-tax issue. Orbitz Worldwide spokesman Brian Hoyt says in practice the city that’s most-impacted is New Castle, Pa., (population around 26,000), which does the lion’s share of hotel business in the county.

Orbitz and other OTAs like Expedia and Travelocity are pursuing a scorched-earth policy against some municipalities that have irked the OTAs and sued them over hotel taxes. The OTAs have ceased selling hotel rooms in Columbus, Ga., for instance, as the Georgia Supreme Court certified the city’s hotel tax ordinance, agreeing it had the right to collect hotel taxes on the retail rate from the OTAs.

But, you’ll notice that the OTAs are reserving their wrath for the little guys like Columbus, Ga., and New Castle, Pa.

None of the OTAs has dropped out of New York City, which instituted a new law in September that specifically targets “room re-marketers” like the OTAs for higher occupancy taxes. And, the OTAs, too, are still marketing rooms in Anaheim, Calif., and San Francisco, where legal decisions so far have been adverse.

In the latest setback for the OTAs, the Georgia Supreme Court, the state’s highest court, ruled this week that hotels.com is liable for hotel taxes on the retail rate and not merely on the net rate that it had been remitting. The ruling follows a similar ruling by that court on Expedia’s tax status in June.

So the major OTAs, have dropped out of Columbus, Ga., and the city apparently is feeling the pain of lost tax revenue.

In retaliation, the City of Columbus has taken the novel and seemingly dubious approach of filing a motion in a lower court, seeking an injunction to force Expedia to renew its marketing of merchant hotel rooms in the city.

The Interactive Travel Services Association, a trade group which represents OTAs and GDS, rightfully was all over that one, and issued the following statement:

“Apparently some lawyers never learned the principles of a free market.  By their Alice-in-Wonderland logic, if your first lawsuit scares a business away, why not file another to try to force them to stay? We hope and expect the court will agree that companies should be allowed to decide when and where they want to do business.”

But, dropping out of a small city or county here and there doesn’t ease the headache for the OTAs as they battle localities large and small across the nation.

For example, this week Florida’s Pinellas County reportedly decided to hire an attorney to look into suing the OTAs to cough up some additional tourism taxes.

Pinellas County should get in line because it undoubtedly won’t be the last to crank up its legal team as this five-year-old hotel tax battle continues.

I have boxes full of lawsuits to prove it.