The travel industry is highly sensitive to consumer trends and competitive dynamics.

So Travel Affiliates take note of the following tool to keep an eye on those trends.

Regardless of what travel niche you compete in or travel product and service you sell, as a travel affiliate, to stay ahead of your competitors, you should be relentlessly monitoring the travel industry’s environmental landscape so as to identify and cull the decisive shifts in consumer sentiments from those that are just transitory in nature, track the marketplace maneuvers of your competitors (or would be competitors), and be prepared to implement tactical or strategic changes to your business at the drop of a dime.

Many travel affiliates, travel suppliers and affiliate network program managers will likely respond that finding either the sources from which consumer trends, insights and business opportunities can be gleaned from – as well as the time and attention one needs to devote towards this critical practice – are in short supply.  With respect to the latter, TravelDividends believes that while time is indeed scarce for most business people, carving-out meaningful minutes to assure you have your finger on the pulse of the travel industry has to be a priority for every travel affiliate marketer or travel industry executive.  As for the former point, that’s a far easier conundrum to resolve, for there are a number of very good – and often free – sources and tools from which travel affiliates can gather solid industry information and insights and use these to more effectively manage and grow their business.  In today’s post, we’ll take a look at one such travel trend tool – Expedia Travel Trendwatch (ETT).

Issued quarterly, Expedia Travel Trendwatch is technically a report on consumer travel trends that is based on the major travel consumer shifts and trends distilled through the online travel agency’s (OTA’s) book of business.  As such, its main purpose is to provide travel consumers with travel insights and tips as to ‘what’s hot, what’s not’ in the topsy-turvy world of leisure and unmanaged business travel.

Given that more U.S. online consumers shop for travel on Expedia than all other U.S. airlines and hotel direct websites combined, in our view, their database is pretty solid.  In fact, TravelDividends looks at Expedia as being the closest thing to a travel version of what the Dow Jones Industrial Average is to the U.S. stock market – an index that gauges the performance of the U.S leisure travel industry.  If viewed from this unique perspective, then within this report (which typically runs between 2 – 6 pages), travel affiliate marketers can find a wealth of information that should help them identify up-and-coming travel destinations, strong or weak products (and suppliers), top consumer travel issues (good or bad) and, in general, harvest information and ideas on how to best capitalize on the ever-changing dynamics of online travel industry.

Here are just a few of the key learnings TravelDividends picked-up by browsing through ETT’s most recent issue (comparing Expedia bookings in the first quarter of 2009 versus same period 2008):

  • Demand for hotels, resorts and vacation packages in the “traditionally budget friendly destinations, like the Caribbean” were up sharply, with the Dominican Republic garnering the top growth spot, up 48%
  • The average price of a Caribbean cruise was down sharply for spring 2009 sailings, approximately 8% industry-wide; for Carnival Cruises specifically, the only major cruise line that offers a travel affiliate program, price points were down 13%
  • Hotel bookings for properties in the 5-Star category were up 48%, due largely to travelers taking advantage of deep promotional discount rates and sales offered by top tier properties around the world
  • Keeping in theme with hotel pricing and the ‘value deals’ being offered by hoteliers, Expedia notes that consumers have been ‘trading-up’ in terms of property quality – which they refer to as a “substantial new trend”Expedia gave these examples in support of the ‘luxury for less’ phenomenon:- 3-Star hotel properties average daily rate was $108, down 18% year-over-year
    – 4-Star hotel properties average daily rate was $172, down 18% year-over-year
    – 5-Star hotel properties average daily rate was $237, down 25% year-over-year
  • Value is also the key in Expedia vacation packages (or, the ‘merchant model’ as its known within Expedia), with demand for 5-Star hotel vacation packages up a whopping 61% in Q1 2009

These and more insights, analyses and trends are available to the inquiring travel affiliate, including a straight-up offer to contact Expedia Travel Trendwatch and request that they provide you with even more statistics, including asking for, as ETT puts it, “a travel trend that you need data to support.”  If you’re interested in taking ETT up on their offer, here’s their contact.

So, how can you put these facts and trends to work for you?  TravelDividends suggests you review your travel portfolio, and compare your bookings to Expedia’s.  Are you tracking similar booking patterns, or are yours better – or worse – than Expedia’s?  Given these trends, look to see how you can best leverage your customer base and supplier relationships to increase your conversion rates and generate incremental sales…or identify where it makes most sense to tweak your campaigns or marketing budget.

We’re curious if any of our Travel Affiliate readers have been using or have used ETT, or whether there are other statistical and trending sources that you rely on to manage your business.  If so, let us know…we’d very much appreciate to hear from you.