On the heels of Expedia Worldwide president Scott Durchslag exiting the company in January, CEO Dara Khosrowshahi used words such as “unsatisfactory” to describe “the overall Expedia brand performance,” and “poorly” to characterize how airline ticket sales and vacation packages fared in the fourth quarter of 2011.

Expedia Inc.’s revenue increased 7% to $787.1 million on a 19% increase in hotel room nights in the fourth quarter, although a decrease in revenue per room night put a damper on things.

Adjusted EBITDA fell 4% in the quarter to $162.1 million, and content and technology costs, including monies allocated to the tech platform, rose 29% to $98.6 million.

Hotels.com and the Expedia hotel product have been migrated to the new tech platform, the air product will be on board by the end of the first quarter, but vacation packages aren’t expected to be transitioned “until the back half of 2012,” Khosrowshahi told financial analysts during the company’s fourth quarter conference call yesterday.

Khosrowshahi expressed confidence that the new platform will increase conversions and enable Expedia to innovate faster, but he conceded that the company has something to prove and “there are a lot of ifs at this point.” He said:

Listen, all other things being equal, when E3 is complete, I would expect to see room night growth accelerate for Expedia, not only standalone room nights but especially packaged room nights that have been a negative factor. And I would hope to see that in the second half of the year. Again, we haven’t done it. But that’s why we’re investing the way that we are on the technology side.

The company says subsidiary Hotels.com, which transitioned to the E3 technology platform in early 2010, “experienced healthy room night growth across all regions during the fourth quarter.”

Khosrowshahi added:

And Hotels.com has continued to maintain … high room night growth. And hopefully, with execution, we’d expect to see that continue on a go-forward basis. But again, we know that we have to prove that out to you. I think the Q4 room night number was really healthy, and I think it was really healthy without Expedia hitting on all cylinders. So if we can hit on all cylinders, we could see things get better. But those are a lot of ifs at this point.

There were bright spots in the earnings announcement.

Expedia is bullish on its 50-50 AirAsia joint venture, which chipped in with healthy room night and hotel revenue growth in the fourth quarter.

And, Expedia CFO Mark Okerstrom says the company is not feeling any impact from Booking.com’s share gains in the US market, where Expedia’s hotel share likewise is growing.

Financial analysts offered varying views about Expedia’s prospects following the earnings release.

Tom White, an analyst for Macquarie Capital, has a “neutral” rating on Expedia and wonders about the cost of the technology upgrades. White says:

The main question for the stock in our view is not whether the Expedia brand’s tech re-platforming will yield improved conversion rates but when and how much the initiative will ultimately cost. This limited visibility, coupled with the potential for y/y EBITDA declines in 1Q given EXPE’s increased seasonality post the TRIP spin is enough to keep us on the sidelines near-term despite EXPE’s appealing relative valuation. Add to this EXPE’s larger relative exposure to the slower-growth/supplier-friendly U.S. market, and we still view PCLN as the preferred way to play the secular shift of global travel bookings moving online.

And, Mark Mahaney, an analyst for Citi Investment Research & Analysis, also has a “neutral” rating on Expedia’s stock, but says the “soft” results for Expedia in the fourth quarter sets the company up for “an excellent 2013.”

Either way, with Booking.com growing its hotel business, Expedia has something to prove.

With the ever-increasing proliferation of smartphones and tablets, mobile internet access and apps, consumers are becoming much more comfortable with browsing and shopping through the mobile.

As a result, many business sectors are having to really push forward their multi-channel strategy and approach to mobile, and travel is one of these.

There is one area of importance potentially above all others when it comes to successful mobile engagement – the experience.

Consumers have very personal relationships with their mobile devices, so it becomes even more crucial than on other digital channels, that the user experience is right and that the recipient is engaged with on their terms.

At Webcredible, we have been doing a lot of consultancy around the mobile user experience and have recently been working a lot within the travel sector.

A recent customer was Hotels.com, which wanted to optimise its mobile offering in line with customer requirements with the further aim of producing results that would improve brand experience, customer satisfaction and loyalty through the mobile channel.

This is a common problem, for many travel brands when looking to make moves in mobile.

The approach to mobile will differ according to the brand itself, but there are some best practice tips that travel brands can follow when looking to optimise the mobile experience for their customers.

1. Reduce the amount of content

Not everything shown on a PC site can fit reasonably onto a mobile web page, where space is short and every pixel counts.

It’s important to reduce the amount of content shown on the mobile-optimised version. Only include the most important content or features.

2. Use single column layouts

Website pages are difficult to view on small mobile phone screens. Even on smartphones like the iPhone with their relatively large screens, standard web pages load up zoomed out so that they can fit on the screen.

Instead, create single column pages that use up the whole width of the screen.

To add additional content the page should expand downwards rather than across, as scrolling down is easier than scrolling across and users generally prefer it.

3. Present the navigation differently

It’s difficult to fit the navigation across the top of the screen on a mobile web page, therefore you must look for alternative options to display the navigation.

A few options include:

• Place the navigation and site search at the top of the page and leave the content for later pages. This is suitable for users who want to navigate or search upon immediately finding the site – a common action with travel websites
• Place the navigation at the bottom – still accessible but doesn’t get in the way of the content
• Place the navigation in a dropdown link at the top of the page

4. Minimise text entry

Text entry on a mobile phone is much more difficult than when using a desktop or laptop keyboard, so mobile websites must take this into account.

Allowing users to store details in their “My Account” section is helpful, and if they already have an online account, then linking this to them as a mobile user will also avoid any unnecessary text entry.

5. Decide whether you need more than one mobile site

If your mobile website is only going to be seen by smartphone users with fast download speeds then one mobile version will be ok.

However, if you want a broader reach then you should consider creating a paired down version. Facebook goes as far as having three main mobile versions.

6. Take advantage of inbuilt functionality

Many mobile phones have an advantage over PCs – they come with lots of inbuilt functionality that most PCs don’t have.

You can make it easier for users to perform certain tasks by utilising a mobile’s inbuilt functionality and thereby remove the need for manual steps, for example; making calls, seeing an address on a map and finding the nearest.

However, although these kind of best practice guidelines can help with some ‘quick wins’ for your mobile proposition, travel brands must ensure that their mobile strategies are based on real insights into the behaviours and needs of their audiences and target markets through the customer lifecycle.

Live example

In the case of Hotels.com, Webcredible worked to gain more of an understanding of smartphone users’ use of mobile sites and applications (and any other activity) to guide the development of its mobile website and iPhone and Android apps.

The main objectives of the research was to learn:

How people use smartphones in relation to researching, planning and booking travel
How smartphones are used by travellers while they travel to their destination and how they’re used during holidays and business trips
What are the current barriers that prevent some users from travel-related smartphone use

We used diary study methods, interviews and expert analysis projects, along with its mobile industry knowledge and integrated research, to produce a set of guidelines and recommendations for Hotels.com to build its mobile strategy, which were detailed in a report which:

• Mapped smartphone use against the travel lifecycle
• Updated existing personas to include smartphone use
• Highlighted current attitudes and behaviours towards arranging hotels, flights, meals entertainment and other activities across digital channels
• Reported on how smartphones are being used to store travel-related information
• Discussed current barriers to using smartphones for bookings
• Offered ideas and suggestions for future smartphone opportunities

The importance of a mobile optimised website cannot be underestimated in the travel industry.

When online, if a user struggles to complete a task on your website, they are very likely to simply “drop-off” and go to a competitor’s site.

With the increase in speed of mobile devices and connections, this type of behaviour will become increasingly prevalent on mobile devices as well and travel brands need to ensure they’re providing a mobile user experience that seamlessly matches the online experience, making it easy for consumers to complete the tasks they want, when they want, through whichever platform they want.

NB: This is a guest article by Trenton Moss, director at UK-based Webcredible.

The Canada, France and global site capture a massive 16% market share in the category, three times as much as Booking.com and almost eight times bigger than Hotels.com.

Most popular travel websites in Canada for the week ending January 28 2012:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia Canada	www.expedia.ca	13.54%	1
2	itravel2000	www.itravel2000.com	5.74%	2
3	Flight Network	www.flightnetwork.com	4.73%	3
4	Red Tag Vacations	www.redtag.ca	4.49%	4
5	Sunwing	www.sunwing.ca	3.86%	5
6	Voyages Arabais	www.voyagesarabais.com	3.45%	6
7	Hotwire	www.hotwire.com	3.14%	8
8	Tripcentral.ca	www.tripcentral.ca	2.88%	7
9	Travelocity Canada	www.travelocity.ca	2.69%	9
10	SellOffVacations.com	www.selloffvacations.com	2.49%	-

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor Canada	www.tripadvisor.ca	10.20%	1
2	Booking.com	www.booking.com	5.37%	2
3	TripAdvisor	www.tripadvisor.com	3.49%	3
4	TripAdvisor France	www.tripadvisor.fr	2.63%	5
5	Hotels.com	www.hotels.com	2.53%	4
6	BookIt.com	www.bookit.com	1.75%	6
7	Vacation Rentals by Owner	www.vrbo.com	1.53%	7
8	Princess Cruises	www.princess.com	1.50%	-
9	City of Toronto	www.toronto.ca	1.49%	9
10	Monarc.ca	www.monarc.ca	1.28%	10

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Air Canada	www.aircanada.ca	26.11%	1
2	WestJet	www.westjet.com	25.67%	2
3	Air Transat	www.airtransat.com	6.79%	3
4	Allegiant Air	www.allegiantair.com	3.97%	4
5	acaeronet.aircanada.ca	acaeronet.aircanada.ca	2.64%	5
6	Porter	www.flyporter.com	2.63%	-
7	Delta Air Lines	www.delta.com	2.26%	7
8	Southwest Airlines	www.southwest.com	1.67%	-
9	Air Canada Employee Travel Site	travel.aircanada.com	1.66%	6
10	Spirit Airlines	www.spiritair.com	1.63%	9

NB: Data courtesy of Experian Hitwise

NB2: Image via Shutterstock.

The Canada, France and dot-com sites for TripAdvisor have a 16% share of the destination and accommodation category, while the remaining seven (including Booking.com and Hotels.com) also have around 16%.

Meanwhile, WestJet has strengthened its recently won prime position in the airline category, stretching its lead over Air Canada to over 3%.

Most popular travel websites in Canada for the week ending January 7 2012:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia Canada	www.expedia.ca	13.58%	1
2	Flight Network	www.flightnetwork.com	5.02%	2
3	itravel2000	www.itravel2000.com	4.80%	3
4	Red Tag Vacations	www.redtag.ca	3.82%	4
5	Voyages Arabais	www.voyagesarabais.com	3.64%	6
6	Sunwing	www.sunwing.ca	3.22%	7
7	Tripcentral.ca	www.tripcentral.ca	2.91%	8
8	Hotwire	www.hotwire.com	2.66%	9
9	Travelocity Canada	www.travelocity.ca	2.65%	5
10	SellOffVacations.com	www.selloffvacations.com	2.45%	10

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor Canada	www.tripadvisor.ca	9.44%	1
2	Booking.com	www.booking.com	5.21%	2
3	TripAdvisor	www.tripadvisor.com	3.59%	3
4	Hotels.com	www.hotels.com	2.87%	4
5	TripAdvisor France	www.tripadvisor.fr	2.54%	5
6	BookIt.com	www.bookit.com	1.93%	7
7	Vacation Rentals by Owner	www.vrbo.com	1.70%	10
8	City of Toronto	www.toronto.ca	1.58%	8
9	Princess Cruises	www.princess.com	1.44%	9
10	Monarc.ca	www.monarc.ca	1.43%	-

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	WestJet	www.westjet.com	29.97%	1
2	Air Canada	www.aircanada.ca	26.65%	2
3	Air Transat	www.airtransat.com	5.58%	3
4	Porter	www.flyporter.com	3.65%	5
5	Allegiant Air	www.allegiantair.com	3.37%	4
6	acaeronet.aircanada.ca	acaeronet.aircanada.ca	2.18%	6
7	Air Canada Employee Travel Site	travel.aircanada.com	1.99%	7
8	Delta Air Lines	www.delta.com	1.91%	8
9	Alaska Airlines and Horizon Air	www.alaskaair.com	1.83%	10
10	American Airlines	www.aa.com	1.61%	9

NB: Data courtesy of Experian Hitwise

NB2: Image via Shutterstock.

The online travel agent, which unveiled ebookers hotels for the iPad last week, wants to serve up last minute deals via its mobile website and app and use the main website for deals with longer lead times.

Ebookers boss Tamer Tamar says the OTA is already seeing consumers on the mobile site are five to six times more likely to book on the same night of the stay.

The figures are supported by Priceline numbers showing 70% of mobile customers are booking same-day deals.

Ebookers also wants to further integrate the hotels app with the travel inspiration Explorer app to provide a more seamless experience for consumers.

Currently there is a button within Explorer which links to the relevant hotel page on the website as well as prompting consumers to download the hotels app.

“We want to really connect Explorer with our other tablet apps. No one has been able to connect the inspiration stage with the booking. We did not want Explorer to be a sales too but it gives us an engaged customer to go to our booking application.”

Ebookers plans to release versions of the hotels app for iPhone, Android and Nokia devices before the end of the year as well as introduce functionality to save and share itineraries.

Social media integration is also part of the development strategy for the Explorer app.

Hotels.com, which unveiled its new iPad app the day before ebookers, has also made a big play on user experience.

The company sees tablets becoming the primary device for consumers to go online and developed its app based on how consumers perceive and interact with these devices.

According to marketing boss Christelle Chan:

“They think it’s fun and easy. Like never before the experience should start with the planning stage so we put together an app that brings together all this fun and easiness.”

The company has high ambitions for mobile, according to Chan, with the new app only the beginning and further releases expected in 2012.

“All of the companies verticals are geared towards mobile and a ‘mobile expert pod’ is in place to devise a coherent strategy across the board.”

Rate integrity means different things to different people, but what happens when “mobile exclusive rates” aren’t so exclusive, or at least they don’t take on the appearance of exclusivity?

For example, take a look at this “mobile exclusive” $55 rate found on the Hotels.com website Sept. 27 for a stay at the Hotel VQ in Denver that night.

A true “mobile exclusive” loses its exclusivity if it shows up online on a hotel-booking website.

Kayak.com was showing the Hotel VQ’s “mobile exclusives” a few days earlier, as well.

Hotels.com had a “mobile exclusive” for at least one other property, The Burnsley All-Suite Hotel in Denver, the other day.

For the record, Hotels.com says the “mobile exclusives” it showed online for the two properties actually were legitimate last-minute rates, although they were somehow mislabeled as mobile exclusives.

“The rates you saw were valid,” says Katie Deines Fourcin, a spokeswoman for Hotels.com’s parent, Expedia Inc.  ”Hotels have the ability to load multiple rate types into our system and set parameters on specific promotional messages, such as making a certain rate available only to mobile customers.

“In this case, the offers started out as mobile-only deals, and then the properties decided to offer those rates as last minute deals on all points of sale,” Deines Fourcin adds.  ”They just forgot to change the promotional tag to ‘last minute deal’ instead of ‘mobile exclusive.’”

An official at Hotel VQ was unsure about whether that was indeed what happened, and was looking into it.

“The error was probably from the property level feed,” a Kayak sp0kesman says, referring to the hotel’s display on Kayak and adding, “Does anyone out there think mobile exclusives are a good idea?”

One person who does is Sam Shank, who founded Hotel Tonight, an app-only booking site which deals in mobile-exclusive rates.

The Hotel VQ spokesman says the property had a mobile exclusive deal with Hotel Tonight.

About Priceline’s new Tonight-Only Deals, spokesman Brian Ek says what is billed as exclusive inventory “means these are specially discounted rates that we don’t believe you will find on any other third-party site.”

As with Hotel Tonight, Priceline’s Tonight-Only Deals don’t guarantee a room type.

Priceline’s iPhone Negotiator app today was showing a $188 rate for the Back Bay Hotel in Boston on a tonight-only basis. The hotel’s own website showed the cheapest room, a Superior Room with two double beds or one queen bed, for $289.

Hotel revenue managers will increasingly have to grapple with the mobile channel and policing its rates as mobile hotel distribution gains traction.

Shank argues that “desktop brands,” meaning online travel agencies and other intermediaries which primarily operate online, aren’t particularly adept at mobile.

“They have challenges when they try to go mobile,” Shank contends.

One could probably debate if that is indeed the case.

Meanwhile, mobile exclusive deals will also increasingly become an issues for global distribution systems, which will have to try even harder to chase after their elusive goals of “full content.”

Just hours after hotels.com releases its funky new iPad app, ebookers quietly unveils it’s own hotels offering.

Then, news from  Travelzoo, which not wanting to be left out, plans to unleash its first European iPhone app on Monday.

The irony of this sudden flood of new apps will not be lost on those that read the today’s Talking Travel Tech blog which gives an account of when and why we cover apps.

The ebookers app is more functional with similar search and filtering capabilities to hotels.com but less of the bells and whistles – not always a bad thing although tablets lend themselves to those richer features.

Travelzoo’s iPhone service, meanwhile, gives users in the UK, Germany, France and Spain access to travel, entertainment and local deals.

The service comes two months after the release of the app for the US market, which has received 75,000 downloads so far.

As well as Travelzoo’s Top 20 and deals near me functionality the app features an Inspire Me section with a photo collage, rolling deals and a map view of deals.

Press information from the deals specialist highlights how the release of the European app is scheduled for a day before Apple’s iPhone 5 on October 4.

It’s incredible how an industry working on such tight margins can afford to throw cash at these ‘latest, best and most innovative’ developments, or should that be, they can’t afford not to?

International, France and Canada editions push the site to 13% share compared to 5% for Booking.com and 4% for Hotels.com.

Most popular travel websites in Canada for the week ending September 24 2011:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia Canada	www.expedia.ca	13.83%	1
2	Flight Network	www.flightnetwork.com	5.67%	2
3	itravel2000	www.itravel2000.com	3.41%	4
4	Hotwire	www.hotwire.com	3.20%	3
5	Red Tag Vacations	www.redtag.ca	2.99%	5
6	Voyages Arabais	www.voyagesarabais.com	2.78%	7
7	Expedia	www.expedia.com	2.67%	6
8	priceline.com	www.priceline.com	2.55%	9
9	Sunwing	www.sunwing.ca	2.49%	-
10	Travelzoo Canada	www.travelzoo.com/ca	2.43%	8

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor	www.tripadvisor.com	7.13%	1
2	Booking.com	www.booking.com	4.89%	2
3	TripAdvisor Canada	www.tripadvisor.ca	3.19%	4
4	Hotels.com	www.hotels.com	3.07%	3
5	TripAdvisor France	www.tripadvisor.fr	2.53%	5
6	InterContinental Hotels Group	www.ichotelsgroup.com	1.89%	7
7	City of Toronto	www.toronto.ca	1.78%	6
8	Vacation Rentals by Owner	www.vrbo.com	1.74%	8
9	Princess Cruises	www.princess.com	1.45%	9
10	BookIt.com	www.bookit.com	1.19%	10

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Air Canada	www.aircanada.ca	29.21%	1
2	WestJet	www.westjet.com	24.59%	2
3	Air Transat	www.airtransat.com	5.01%	3
4	Allegiant Air	www.allegiantair.com	3.60%	4
5	acaeronet.aircanada.ca	acaeronet.aircanada.ca	2.92%	5
6	Delta Air Lines	www.delta.com	2.72%	6
7	Air Canada Employee Travel Site	travel.aircanada.com	2.32%	8
8	Porter	www.flyporter.com	1.94%	9
9	Southwest Airlines	www.southwest.com	1.84%	-
10	Alaska Airlines and Horizon Air	www.alaskaair.com	1.84%	7

NB: Data courtesy of Experian Hitwise

The app, which was previewed to friends and family three weeks ago, allows access to 140,00 hotels as well as 20,000 last-minute deals with the ability to search for late availability locally.

The service also offers users an interactive skyline with images of iconic landmarks and various search and filtering tools for consumers to pinpoint the best hotel.

Other features include the ability to synchronise bookings between iPad, mobile device and desktop as well as access to booking history.

Hotels.com unveiled its mobile apps in the spring and claims 1.5 million downloads since April.

The launch of the hotels.com app came hours before the release of a hotels app from ebookers.

The ebookers hotel app is in addition to its Explorer app, released in May, and according to developer Fortune Cookie, is consistently ranking in the top five in its category across more than 80 countries.

The launch of the hotels.com service is supported by marketing activity across mobile and online channels.

In a marketing campaign consisting of display ads, social media, a microsite, an animated TV spot with claymated characters and a video, Hotels.com argues that its iPhone and Android apps allow for hotel bookings on the fly.

With an assist from “extreme athlete and stuntman” JT Holmes, Hotels.com shows in the following video how you — or Holmes, at least, — can book a stay at the Hyatt Regency Lake Tahoe Resort while skydiving from 15,000 feet.

You can call it, as Hotels.com does, “extreme booking.”

httpv://www.youtube.com/watch?v=Q7eHinI95rc

The message is that the app is swift and agile.

Hotels.com doesn’t call out Hotel Tonight specifically about the relative speed of its app, but perhaps the latter can come up with a stunt to top Holmes’ free fall.

Just dropping a hint.

Meanwhile, Hotels.com states its mobile apps have been downloaded more than one million times and an iPad booking app is on the drawing board for the “near future.”

The .com, Canada and France sites have a 12% share of the destinations and accommodation category, 6% more than Booking.com in second place.

Sister-Expedia brand Hotels.com is in third place with a 4% share. IHG is the most popular hotel chain in the country with 2%.

Most popular travel websites in Canada for the week ending August 20 2011:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia Canada	www.expedia.ca	14.34%	1
2	Flight Network	www.flightnetwork.com	5.40%	2
3	Hotwire	www.hotwire.com	3.96%	3
4	itravel2000	www.itravel2000.com	3.70%	4
5	priceline.com	www.priceline.com	3.12%	5
6	Expedia	www.expedia.com	2.91%	6
7	Red Tag Vacations	www.redtag.ca	2.60%	7
8	Sunwing	www.sunwing.ca	2.37%	-
9	Orbitz	www.orbitz.com	2.25%	9
10	Travelzoo Canada	www.travelzoo.com/ca	2.24%	8

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor	www.tripadvisor.com	6.98%	1
2	Booking.com	www.booking.com	5.63%	2
3	Hotels.com	www.hotels.com	4.35%	3
4	TripAdvisor Canada	www.tripadvisor.ca	2.89%	4
5	TripAdvisor France	www.tripadvisor.fr	2.25%	5
6	InterContinental Hotels Group	www.ichotelsgroup.com	1.96%	6
7	City of Toronto	www.toronto.ca	1.50%	7
8	Princess Cruises	www.princess.com	1.34%	8
9	BookIt.com	www.bookit.com	1.26%	-
10	Vacation Rentals by Owner	www.vrbo.com	1.20%	9

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Air Canada	www.aircanada.ca	29.21%	1
2	WestJet	www.westjet.com	24.77%	2
3	Air Transat	www.airtransat.com	5.52%	3
4	Allegiant Air	www.allegiantair.com	3.86%	4
5	acaeronet.aircanada.ca	acaeronet.aircanada.ca	2.82%	6
6	Air Canada Employee Travel Site	travel.aircanada.com	2.66%	7
7	Porter	www.flyporter.com	2.64%	5
8	Delta Air Lines	www.delta.com	2.34%	8
9	JetBlue Airways	www.jetblue.com	1.98%	-
10	Alaska Airlines and Horizon Air	www.alaskaair.com	1.73%	10

NB: Data courtesy of Experian Hitwise

TripAdvisor, Hotels.com and Marriott are the leading three brands in the sector, with 9%, 3.5% and 3% respectively.

The top thee sites in the agency category have combined total of 31%, while the airlines top ten have 45%.

Most popular travel websites in the US for the week ending August 20 2011:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia	www.expedia.com	12.33%	1
2	Yahoo! Travel	travel.yahoo.com	10.36%	3
3	priceline.com	www.priceline.com	9.58%	2
4	Orbitz	www.orbitz.com	6.75%	4
5	Travelocity	www.travelocity.com	5.97%	5
6	Hotwire	www.hotwire.com	5.44%	6
7	CheapOair	www.cheapoair.com	4.55%	7
8	Kayak	www.kayak.com	3.76%	8
9	bookingbuddy	www.bookingbuddy.com	2.88%	9
10	Cheap Tickets	www.cheaptickets.com	2.78%	10

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor	www.tripadvisor.com	7.96%	1
2	Hotels.com	www.hotels.com	3.50%	2
3	Marriott International	www.marriott.com	2.75%	3
4	InterContinental Hotels Group	www.ichotelsgroup.com	2.42%	4
5	Hilton Hotels Online	www.hilton.com	2.12%	5
6	Carnival Cruise Lines	www.carnival.com	1.78%	8
7	Booking.com	www.booking.com	1.73%	7
8	Vacation Rentals by Owner	www.vrbo.com	1.70%	6
9	Choice Hotels International	www.choicehotels.com	1.45%	9
10	Walt Disney World	disneyworld.disney.go.com	1.11%	10

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Southwest Airlines	www.southwest.com	22.20%	1
2	Delta Air Lines	www.delta.com	13.76%	2
3	American Airlines	www.aa.com	9.47%	3
4	JetBlue Airways	www.jetblue.com	8.70%	4
5	Continental Airlines	www.continental.com	6.78%	5
6	United Airlines	www.united.com	5.72%	7
7	US Airways	www.usairways.com	5.41%	6
8	AirTran Airways	www.airtran.com	4.42%	8
9	Spirit Airlines	www.spiritair.com	3.36%	9
10	Alaska Airlines and Horizon Air	www.alaskaair.com	2.88%	10

Travel search terms

Rank	Search Term	Percentage of Clicks	Percentage Paid	Percentage Organic	Previous Position
1	mapquest	4.28%	0.18%	99.82%	1
2	google maps	1.62%	0.25%	99.75%	2
3	southwest airlines	0.91%	39.09%	60.91%	4
4	maps	0.89%	0.12%	99.88%	3
5	map quest	0.81%	0.29%	99.71%	5
6	expedia	0.63%	43.57%	56.43%	6
7	mapquest driving directions	0.57%	0.48%	99.52%	8
8	travelocity	0.55%	56.79%	43.21%	7
9	american airlines	0.43%	3.80%	96.20%	-
10	yahoo maps	0.40%	0.82%	99.18%	-

NB: Data couresy of Experian Hitwise

Expedia’s sister company Hotels.com also is in the process of getting its links removed from a Christian Values Network site.

And, Priceline is at least temporarily removing the Christian Values Network from the online travel agency’s affiliate network while it looks into the matter.

Expedia this afternoon posted the following status update on its Facebook page: “Thanks you for all your comments about Christian Values Network. When we learned earlier this week that the organization directs funds to to groups that have been deemed ‘active hate groups’ by the Southern Poverty Law Center, we ended our affiliation immediately.”

Hotels.com posted a similar message on its Facebook page.

The URL CVN.org takes you to the Global Prayer Network site, described as “an online Christian prayer community,” which offers a toolbar and links to various ecommerce sites. You download the toolbar, select an ad and navigate to an ecommerce site for shopping, and then the group donates “a percentage of your total purchase” to organizations that you designate from a list they provide.

Here are some of the travel companies listed as places to shop through their affiliate programs:

Regarding the image above, Priceline and Hotels.com are in the process of removing their ties to the organization. Other travel companies listed include Ramada, Super 8, RentalCars.com, Best Western, BedandBreakfast.com and several others.

Delta Air Lines and Apple recently cuts ties to CVN.

Focus on the Family and the Family Research Council are among the organizations on the list which the Southern Poverty Law Center and others characterize as anti-gay and anti-women.

For example, the Southern Poverty Law Center says Focus on the Family has argued “that anti-bullying efforts that draw attention to the harassment of lesbian, gay, bisexual and transgender (LGBT) students are part of a ‘gay agenda’ to ‘sneak’ homosexuality lessons into classrooms.”

The afilliate ties to the Christian Values Network put Expedia in an awkward position as it markets to the LGBT community.

Several efforts had been under way to pressure major brands to extinguish ties with the Christian Values Network.

Hotels.com, which has been on the technology platform since 2010, saw its gross bookings increase 50% in the second quarter of 2011 compared with the year-earlier period. That’s on top of a gross bookings increase of 39% during the first three months of the year.

Asked to describe what the technology platform is, Expedia spokeswoman Katie Deines Fourcin says, “It’s essentially a new foundation on which to build new features and functionality. It allows us to innovate, test and learn more quickly and efficiently.”

Expedia CEO Dara Khosrowshahi, speaking during the company’s second quarter earnings call July 28, said the company chose Expedia UK as the first entity among Expedia brands to get the new technology platform because “it’s a good mature market. We can work out the kinks in a couple of weeks.”

The plan is to introduce the technology platform on Expedia brands across Europe and then to bring it to the U.S., Khosrowshahi said.

Hotels.com has notched its “acceleration” in the U.S. and especially in Europe and Asia-Pacific, Khosrowshahi said, and increased conversions based on the new platform are driving the “core acceleration.”

He said the technology platform makes it easy to “drive new feature sets in one area,” see what works and what doesn’t, and then roll out the features “across the globe.”

Khosrowshahi said Expedia.com — the U.S. site — is involved currently the subjected of a tech conversion and is not performing up to potential while Hotels.com, Expedia’s corporate unit, Egencia, and the TripAdvisor Media Network are leading the pack.

Khosrowshahi said there’s no guarantee that placing Expedia sites on the new technology platform will deliver the robust hotel-gross bookings’ at a level that Hotels.com has experienced, but he’s hopeful there would be a bounce.

In other developments:

• Expedia expects to complete the spinoff of TripAdvisor into a public company before the end of 2011.

• Khosrowshahi said Expedia.com is still working with its GDS partners and American Airlines to come up with a “connectivity strategy” to tie into the airline’s direct-connect offering through GDS aggregation technology. He said the details of the talks are “quite confidential.”

• Expedia will be monitoring the just-launched Google Hotel Finder, which is fundamentally a metasearch and advertising product, Khosrowshahi said. Expedia participates in Google Hotel Finder and “we welcome innovation,” he added. Khosrowshahi said Expedia can buy traffic at attractive rates through metasearch. “That’s a channel we play very well in,” he said.

• During the second quarter, which ended June 30, Expedia introduced flight metasearch to TripAdvisor sites in Canada, France, Germany, Ireland, Italy and Spain.

• TripAdvisor launched its first Arabic language site and its 30th site overall in Egypt during the second quarter.

• Expedia claims that an Expedia, Hotels.com, TripAdvisor or Hotwire Travel-Ticker app gets downloaded 36 times per minute on average.

TripAdvisor Australia and the main dot-com site, combined with Hotels.com, have almost 10% of the market, 3% ahead of individual market leader Wotif.

Priceline-operated Booking.com remains with a 3.5% share of the category.

Most popular travel websites in Australia for the week ending July 16 2011:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Webjet Australia	www.webjet.com.au	14.22%	1
2	Expedia Australia	www.expedia.com.au	10.77%	2
3	Flight Centre	www.flightcentre.com.au	8.93%	3
4	Lastminute.com.au	www.lastminute.com.au	5.42%	4
5	Best Flights	www.bestflights.com.au	3.11%	5
6	Jetabroad	www.jetabroad.com	2.79%	6
7	ZUJI Australia	www.zuji.com	2.63%	7
8	Airfares Flights Australia	www.airfaresflights.com.au	2.48%	8
9	Orbitz	www.orbitz.com	1.74%	-
10	travel.com.au	www.travel.com.au	1.66%	10

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Wotif.com	www.wotif.com	6.71%	1
2	TripAdvisor	www.tripadvisor.com	4.95%	2
3	Booking.com	www.booking.com	3.51%	3
4	Stayz	www.stayz.com.au	2.78%	4
5	Totaltravel.com	www.totaltravel.com	2.17%	6
6	TripAdvisor - Australia	www.tripadvisor.com.au	1.95%	5
7	Hotels.com	www.hotels.com	1.58%	8
8	HotelClub	www.hotelclub.com	1.43%	9
9	Adrenalin	www.adrenalin.com.au	1.40%	-
10	Ski.com.au	www.ski.com.au	1.19%	7

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Qantas	www.qantas.com.au	26.44%	1
2	Jetstar	www.jetstar.com	20.33%	2
3	Virgin Australia	www.virginaustralia.com	16.80%	3
4	AirAsia	www.airasia.com	5.35%	5
5	Emirates	www.emirates.com	2.79%	6
6	Tiger Airways	www.tigerairways.com	2.46%	4
7	Air New Zealand - Australia	www.airnz.com.au	2.08%	-
8	Singapore Airlines	www.singaporeair.com	2.07%	7
9	Malaysia Airlines	www.malaysiaairlines.com	1.75%	8
10	Air New Zealand	www.airnz.co.nz	1.55%	9

Search Terms

Rank	Search Term	Percentage of Clicks	Percentage Paid	Percentage Organic	Previous Position
1	google maps	1.72%	0.01%	99.99%	2
2	jetstar	1.36%	1.08%	98.92%	1
3	qantas	0.89%	15.08%	84.92%	3
4	webjet	0.85%	0.20%	99.80%	4
5	virgin blue	0.74%	51.19%	48.81%	5
6	maps	0.61%	0.00%	100.00%	6
7	wotif	0.56%	0.22%	99.78%	7
8	flight centre	0.55%	62.69%	37.31%	8
9	metlink	0.48%	0.00%	100.00%	9
10	air asia	0.32%	4.62%	95.38%	-

NB: Data courtesy of Experian Hitwise

The OTAs for a decade have bundled their “taxes and fees” when consumers book hotel rooms on a merchant model basis because the OTAs sought to hide their margins out of competitive concerns. In so doing, consumers are kept in the dark about how much taxes they are paying and how much is allotted for service fees.

But in handing the OTAs a $20.6 million or more defeat in the City of San Antonio vs. Hotels.com class-action lawsuit, Judge Orlando Garcia made several revelations, which the OTAs may consider confidential.

In filing an advisory motion on July 5, four days after the judge’s ruling, the defendants cited one of the revelations that they deem should be confidential. “For example, the court disclosed the method and manner that Hotels.com calculated its service fee…” the OTAs stated.

As part of its ruling, the court, citing testimony, disclosed that:

• For around 11 years, “Hotels.com’s service fee was calculated by taking the markup or margin and multiplying it by the tax rate.”

• “For six years, Travelocity’s variable surcharge was calculated by taking the markup amount and multiplying it by the tax rate, resulting in the same amount that the Cities contend should have been paid in taxes…. In November 2008, the variable surcharge was dissolved and the fixed service fees went from 2.61 to 5.5%.”

• Expedia, too, used an adjustable service fee that equated to the amount the cities deemed they were owed on Expedia’s markup.

In their advisory motion, the online travel agencies alleged that the court erroneously disclosed confidential information that was part of a protective order and a pending motion to redact the transcript of the trial.

The defendants therefore asked the court to “temporarily” seal the judge’s July 1 ruling, which already has been made public.

The defendants asked the court to seal the ruling “immediately” because they realize it would be used in other court cases around the country and then they would have to file similar motions to block the revelations of what they consider to be confidential information in those courts.

In his July 1 ruling, the judge stated that the OTAs, when selling hotel rooms in Texas, should collect taxes on the retail rate and transparently disclose their taxes and fees. If they did so, then there would be no mystery concerning how they calculate the service fees they charge.

But, the OTAs plan to appeal the judge’s ruling about their hotel tax liabilities.

The court on July 1 also disclosed several items about OTA-hotel contracts that the OTAs assuredly didn’t want to see in the public domain.

Among them, the court revealed:

• The 2006 Expedia-Marriott contract and an Expedia agreement with InterContinental Hotels barred the hotels from advocating that the online travel agencies should collect tax on their markups.

• In the run-up to InterContinental Hotels’ withdrawal from Expedia in 2004, InterContinental Hotels pressed Expedia to transparently display taxes and fees. Expedia and sister company Hotels.com refused to do so, and the hotel group didn’t do business with the two for a couple of years.

• Although the OTAs claim the wholesale rates they get from hotels are confidential, OTA-hotel contracts, “with rare exception,” include “parity and most favored nation clauses and the various OTCs have the same wholesale or net rate with the hotels and/or hotel chains.”

• Expedia and Hotels.com collected taxes on the retail rate when selling hotels using the merchant model for a short period, ending in 2002.

The court also provided a possible glimpse into the online travel agency e-commerce world in the event that they are forced to pay taxes on their margins when selling rooms using the merchant model.

The judge noted that: “The OTCs (online travel companies) concede that they currently make enough revenue through their markup and service fee to charge taxes on the margin and still make a considerable profit.”

In the event that the OTAs had to pay taxes on their margins, they simply would pass on the additional taxes to the consumer, the judge quotes a Travelweb (Priceline) official as testifying.

Expedia-owned Hotels.com blasted (no pun intended) viewers with the 10-second ad over 100 times over a 72-hour period, including slots on high profile terrestrial channels ITV and Channel 4.

The ad is supporting the UK part of a short global sale campaign (presumably with different creative for regions in Europe that perhaps have less affinity for classic British war movies).

httpv://www.youtube.com/watch?v=cGzu3gZcUwM

Expedia Hotels for Android uses GPS to enable travelers to find nearby hotels and facilitates bookings in four taps from research to booking phases, Expedia says.

Expedia Hotels for Android, the company’s first Android app since acquiring Mobiata in November 2010, features “Android-specific landscape views for flexibility on a wide range of Android devices,” Expedia says.

And, Expedia upgraded its mobile site for U.S. customers, with new mobile features coming for travelers outside the U.S. “in the coming weeks,” the company says.

The mobile website now features expanded property and room details, and travelers can navigate from the hotel map guides to their desired hotel with a single tap, Expedia says.

Meanwhile, sister brand Hotels.com launched iPhone and Android apps, which provide booking capabilities for 135,000 hotels around the world in 30 languages, Hotels.com says.

The Hotels.com apps have a “sign-in once” feature, and users can access past and future bookings whether the device has a data connection or not, the company says.

The flurry of mobile rollouts follow Expedia Inc.’s acquisition of Mobiata last November.

Mobiata was slated to demo the Expedia Hotels for Android app in the Developer Sandbox at the Google I/O meet-up in San Francisco May 10 to 11.

The company reported its first quarter 2011 earnings yesterday, and saw its operating income diminished because of higher expenses associated with technology investments and international expansion.

“We will be surprised if it doesn’t work,” said Dara Khosrowshahi, president and CEO, referring to implementation of the new tech platform. “It is a risk we’re taking, but we’re very confident in 1) the patterns that we’re seeing based on our experience with Hotels.com and 2) based on the Expedia team’s ability to deliver.”

Hotels.com last year transitioned to a new tech platform, a project internally dubbed 1H, and in the first quarter of 2011 Hotels.com saw its gross bookings rise 39%, more than triple the growth pace of the year-earlier period.

Expedia already has portions of Expedia hotels on the new platform and has rolled out new hotel search results, filters and a checkout path. With the new platform, which will take several years to fully implement, the company hopes to be able to innovate faster and increase conversions.

Khosrowshahi isn’t promising that Expedia growth rates on the new platform would duplicate the success at Hotels.com.

“Are we going to see that kind of multiplier effect on Expedia after the fact? …” Khosrowshahi asked. “I’m not counting on it, but an accelerator on Expedia would result in great top line and bottom line results for the company as a whole, and that’s what we’re betting on.”

On other issues, Khosrowshahi said Google Places, which has Google preferencing its own results over organic results, hurt TripAdvisor’s growth.

Third-party revenue for TripAdvisor jumped 32% in the quarter, but would have been faster without the Google Places impact, Khosrowshahi said.

Google Places “hurt us, but the TripAdvisor management team adjusted well” and the unit, which will be spun off into a public company in the Fall, experienced “healthy growth despite Google’s actions,” Khosrowshahi said.

“Rumors of impending doom for TripAdvisor’s traffic have been entirely false,” he added.

Khosrowshahi added that transitioning Expedia Inc. and TripAdvisor into two publicly traded companies will enable both to better focus on their missions.

Asked to comment on the closing of Google’s acquisition of ITA Software, Khosrowshahi said it was appropriate for the U.S. Department of Justice to impose conditions, but he curiously acknowledged that Expedia “doesn’t have the detail of exactly what the conditions mean.”

He noted that the Federal Trade Commission and European Union may continue to probe competition issues related to Google’s market power. “We don’t think this is the end of the story.”

On the rapprochement with American Airlines, Expedia acknowledged that its air ticket volumes were hurt by the airline’s absence on Expedia and Hotwire sites during the quarter.

Expedia and American Airlines signed a memorandum of understanding April 4, and the airline’s flights and schedules returned to those sites.

“I don’t think either party can declare a victory,” Khosrowshahi said.

Dara Khosrowshahi, the Expedia Inc. president and CEO, spoke about these expansion plans during a conference call Feb. 10 about the company’s fourth quarter 2010 financial results.

Expedia Inc. also has a presence in China, through a controlling interest in eLong.

Khosrowshahi addressed numerous hot-button issues during the session.

Mobile

The team from Mobiata, which Expedia acquired in November 2010, has been “radically improving” Expedia’s mobile products, Khosrowshahi said, adding he expects conversion rates on Expedia’s mobile products to double in the next 18 months and to be on par with Expedia’s Web conversions.

CFO Michael Adler said hotels.com’s mobile products already produce conversion rates at a level similar to hotels.com conversions.

Google Places

While Google paid and organic search are “very significant” traffic drivers for Expedia’s TripAdvisor, the removal of TripAdvisor links from Google Places has not had a big impact, Khosrowshahi said. He added that the impact has been greater in the U.S. than internationally, where TripAdvisor is growing at a double-digit clip.

American Airlines

Calling Expedia’s dispute with American Airlines “a bump in the road,” Khosrowshahi said “we’re still trying to work that out.” He acknowledged that the absence of American Airlines’ flights on Expedia websites will have a short-term impact on fnancial results.

With a majority of Expedia Inc. hotel revenue being generated through direct-connects, Khosrowshahi was asked why Expedia wouldn’t establish airline direct-connects, which is one of American Airlines’ key demands.

He explained that Expedia built direct-connects from the ground up to build its merchant hotel program when there were no alternatives available. In contrast, Expedia gets just 12% of its revenue from selling airline tickets and wouldn’t want to make the kind of investments which would be necessary for airline direct-connects, Khosrowshai said, adding that global distribution system model already works well.

Opaque hotel product

Khosrowshahi said Expedia plans on introducing an opaque hotel product in Europe in the second quarter of 2011.

Expedia.com and hotels.com performances

Khosrowshahi said room night growth for hotels.com hit 30% in January 2011, and he traced the performance to a platform migration completed in the first quarter of 2010 and accelerated work on the hotel path, including adding new features which increased conversions.

“In 2011, it’s really off to a roaring start,” he said, referring to hotels.com room-night growth.

In contrast, Expedia.com’s results were mixed, Khosrowshai said, explaining that Scott Durchslag was brought in as Expedia Worldwide president to address the issues, and conversion improvements are expected in the next six to nine months.

Expedia.com’s results were “lighter on the bottom line than we had planned” in the fourth quarter, CFO Adler said, adding that Winter storms were one factor impacting results.

TripAdvisor

Expedia’s advertising and media revenue climbed 36% in 2010, propelled by a 48% jump in third-party revenue from TripAdvisor.

Khosrowshahi noted that 75% of TripAdvisor’s global traffic comes from outside the U.S. Although the conversion rates are lower outside the U.S., the breadth of international traffic underscores TripAdvisor’s enormous growth potential, he said, adding that TripAdvisor should be a $1 billion business within several years.

Meanwhile, TripAdvisor’s Business Listings solution now includes 25,000 properties, with many of them small, independent properties in Europe, Khosrowshahi said. He said nearly one third of the properties signed up for Business Listings did not previously have a relationship with an online travel agency.

TripAdvisor’s flight metasearch product is not nearly as lucrative as TripAdvisor’s hotel business, Khosrowshahi said, but consumers like the air metasearch product, which enables Expedia to introduce travelers to TripAdvisor and upsell them.

Fourth quarter 2010

On the financial front, Expedia Inc. saw its net income decline 30% to $71.3 million in the fourth quarter of 2010 on $808.4 million in revenue, a 16% rise.

Global hotel room nights grew 15% in the fourth quarter to 18.8 million, and gross bookings increased 14% to $5.75 billion.