The company today has notified writers contributing to the site that it has spent recent weeks evaluating the validity of the company’s business model, but has been forced to concede that Simonseeks is “simply not viable”.

The letter says:

“Consumers are not currently ready to pay for professionally-written travel content online and the amounts generated through hotel bookings and page impressions are not significant enough.”

Revenue was gained through affiliate relationships with suppliers and metasearch engines, and advertising on the site.

Simonseeks captured the attention from the off, primarily because it was backed by Simon Nixon, brainchild of metasearch site TravelSupermarket (and parent company MoneySupermarket).

Its promise of a new revenue opportunity for travel writers (submit content, take a cut of revenue depending on traffic etc) came as many journalists debated the ongoing lack of lucrative writing opportunities on the web as commissions from mainstream media continued to dry up.

The first solid warning signs that the business was struggling came in late-March when six people were made redundant from the company, around half the total headcount.

Four weeks later and Nixon has admitted that despite a number of last-ditch marketing efforts, including a TV advertising campaign, the game is up.

He wrote today:

“Over the course of the last few months the Simonseeks team has been working round the clock in order to drive the commercial side of the business.

“As you will be aware, this has included the investment of substantial marketing time and expertise together with a significant financial commitment in launching television advertising together with many other online and offline initiatives.”

The site will be closed to new editorial content immediately and the company wound down, Nixon says.

“This is not a decision that has been made lightly and is made with the regret of all of the Simonseeks team members who have made every effort to make the business a success.”

Similar to his previous business, Nixon brought in brother Chris to work alongside him as commercial director, only for the sibling to quit in August last year after just 12 months, eventually emerging as boss of the travel division for metasearch site Kelkoo.

In an email statement, Nixon says his funding for the Simonseeks project will cease but “some of our management team are currently discussing how they can continue to operate on a smaller scale”.

“Many of our experts have already shown an interest in this model as they see Simonseeks as a valuable showcase for their knowledge and work.”

Nixon says he hopes the site will eventually continue in some form as it has been an “extremely interesting project to be part of”, despite struggling to get the traction required.

SimonEscapes, another Nixon project focusing on travel property rentals, will continue. He also remains executive deputy chairman of MoneySupermarket.

The 18-month old website will splash out £2 million on a regional and then national campaign on the largest commercial terrestrial channel in the UK, ITV1, kicking off in the North West on Boxing Day and then elsewhere around the country during 2011.

The idea behind the campaign is to focus on the expert writers involved in the site.

The decision to go with an above-the-line and expensive TV ad campaign shouldn’t come as a big surprise, despite it probably being the first so-called content or guide site to run a high profile programme for many years.

Founder Simon Nixon famously backed a TV advertising campaign for metasearch TravelSupermarket, a move which surprised many at the time but suited part of a wider profile raising exercise for parent company MoneySupermarket’s move to an IPO in 2007.

Earlier this year Simonseeks confirmed it had spent around £1 million getting the site up and running and a further £100,000 every month thereafter.

Nixon’s brother Chris (also former managing director of TravelSupermarket) left the company in August 2010, claiming he was looking at “various opportunities” elsewhere.

Nevertheless, the decision to launch a high profile media campaign will no doubt stir the comment boards once again as the Simonseeks proposition has not been universally popular with the travel writers it was hoping to attract.

Nixon and his brother Simon, founder and former-chief executive of MoneySupermarket, reunited to create review and recommendation site Simonseeks in June 2009, an attempt to aggregate guides from travel writers through a compensation programme.

Chris Nixon says he is looking at “various opportunities” outside of Simonseeks, but the exit will surprise many who saw the business as the latest attempt by the brothers to carve out a new model in travel.

An official says:

“Chris has been involved in the business since the beginning and he was always looking to stay until things were up and running. We are now actively recruiting for a head of commercial, ideally someone with a background in  community/and or review sites.”

Simonseeks has not won the universal approval of the travel writing community it was hoping to win over, but has attracted plenty of arguably cheaper content from a myriad of minor and well known celebrities across Europe as well as a large number of consumers happy to contribute to its growing number of guides.

It is not the first time Chris Nixon has left a business suddenly. He quit as MD of TravelSupermarket in early 2008 for a one-year sabbatical, being replaced by Graham Donoghue of TUI Travel.

The company was launched in June 2009 and attracted a fair amount of attention by virtue of the profile of its backer, but equally the site was treated with some scepticism for its payment system for writers.

The site, which combines user reviews and editorial content alongside a metasearch engine for flights and leads to other booking sites, is said to be gearing up for a new look and feel, navigation and structure.

A marketing campaign – no details available as yet – is also being plotted to support the next phase.

Nixon’s previous business famously launched a number of high profile TV advertising spots which thrust the TravelSupermarket into the mainstream travel sites in 2007.

He spent £1 million on the launch of SimonSeeks last year and around a further £100,000 every month following the launch.

A windfall of £13 million was recently handed to Nixon from his previous parent company business MoneySupermarket for which he still acts as deputy chairman.

The payment system for SimonSeeks is based on a revenue share model and has so far yielded only moderate success for some of its contributors, with the top writer securing £80 a month in February 2010. However, the highest amount paid out in January was £40.

Simonseeks, AOL Travel, Lonely Planet, VisitBritain and Skyscanner are five of the high profile brands to take the new widget for their site, featuring Travelzoo-sourced travel deals relevant to the existing content.

The launch of Travelzoo Network in the UK (and expected around Europe over the coming months) follows a similar project introduced into the US and joins its existing newsletter service and on-site publishing of deals.

Travelzoo denies that the launch of an ad network indicates that it is reaching a saturation point in the number of potential subscribers to its existing – and successful – weekly newsletter product and needs to diversify.

The new network sees a 50-50 revenue share between Travelzoo and advertisers every time a user clicks on a link within the hosted site.

Existing advertisers are given an opt-out of the service.

Travel Network Europe vice president Melanie Bower says “very few” advertisers have asked to be removed from the system, although she admits that some smaller travel firms will watch how their allocated advertising budget holds up if clicks from the partner sites rapidly increase in volume.

Four months on and its latest initiative is to aggregate and review flight meta search providers for short-haul trips, each of which provides a revenue stream to Simonseeks, as well as having an exclusive white label widget from another provider (currently Kayak).

Confused? Probably.

The principle behind the site (reviews of products, destinations etc, provided by experts and users) remains, but in the case of flights its has split the service into a number of areas.

For example, Simonseeks “editor” Nick Trend lists two sites for Checking the Options (Flightmapping, AirlineDestinations), four for Search Fare Comparison Sites (Kayak, Dohop, TravelSupermarket, Skyscanner), another six for Other Options (lastminute.com, Expedia, Opodo, Travelrepublic, AirFlights, Ebookers) and four for the charter flight boys (First Choice, Thomson, Thomas Cook, Monarch).

Each provider has a review and pays Simonseeks if a user clicks through to its own search engine. This is either a stroke of genius or really nothing of the sort as the click values might be small – not counting the potentially low volumes during the launch phase.

Meanwhile, Kayak is the provider of the fully functioning flight search widget on the site. This, commercial director Chris Nixon, brother of founder Simon, says will change regularly as they try out different providers.

Nixon admits it’s “early days” but says they are “very pleased” with progress so far.

Problems at the outset, when users were asked to submit reviews to the site but were finding that it took over a week to see the content online, have been reigned in, Nixon promises. Reviews (reaching 2,100 this week), on average, now take around 48 hours to go live, mostly because each goes through a rather traditional editing process.

Where Simonseeks has achieved a fair degree of success is with its “celebrity” postings. Celebrity guides penned by the likes of mum’s favourite Sir Cliff Richard, Jim Kerr (Simple Minds) and Raymond Blanc(Michelin-star chef) have all found their way to mainstream media and magazine sites - an initiative which has led to exposure and valuable SEO for Simonseeks.