Question : CUSTOMER SERVICE

Consumers have two decision stages: when booking they look for cheap prices, but when using they want good services. The key is not segmentation, but is how to please customers who want cheap prices and good services.

Then maybe etrip should cut out low-cost airlines such as Ryanair or Easyjet, because they provide not a good service, or just if you pay an additional fee.

Actually, concerning business people and how they book flights, it varies from company to company as each company will have their own travel guidelines and restrictions. In some small businesses, usually the traveler will book themself, if they are lucky, then a secretary will do that. For larger business, many of them contract travel agencies to handle all booking, or possibly even have their own travel agency department.
So the question is, if Etrip is trying to get business persons to use their service, and the current poor economic situation is not the reason why companies look for cheaper flights, then how do you intend to get secretaries or companies to look at your site first and to use your service? I don't believe it is done by forcing the booking person to go through a bunch of questions to add the options that would normally automatically be available on other airlines or travel agencies. Therefore, I don't see business travel as a long term revenue stream for this website.

I agree with you too but I also think that we first need proves. New customers will never pay a customer fee because the website say that it is the cheapest. As a customer, I will first book the ticket, take the flight, come back and then In a second time, if I'm satisfied by the price and the service and think that I get a real customer value I will pay the customer fee. The travel market is so huge, the advertising is everywhere, it seems like every company say that they are the cheapest so e trip needs to prove that fact first.
I think that this solution should be used only for addicted etrip consumers (link to customer loyalty) not for new users.

Regarding the proposed revenue model, I don't it will work with regard to the paid customer services. Personally, all I want is a cheap flight and I don't really see any value in any of the "services"; so I would not pay for them. If I see a reasonable price, I book it and that's it and then I am also aware that I get what I pay. True, good service is a bonus on flight, but I would not say I expect it.
I don't think its a matter of the search engine to filter out airlines that might offer a nice deal, but compromise on service such as RyanAir or Easyet. So for etrip it is not possible to please the cutomer with cheap price and good service, since it is still left to the customer to finally select the airline.

ProfessorHuang wrote:Consumers have two decision stages: when booking they look for cheap prices, but when using they want good services. The key is not segmentation, but is how to please customers who want cheap prices and good services.

I think that wanting both cheap prices and good services is being slightly demanding. And I honestly think under the student category, most students are no frills kind of people. I mean, that's why most students stay at low-budget hostels when they travel. If service were important, they'd be staying at the Ritz Carlton instead.

@Alexandra: I agree. I don't think the services that Etrip offers provide any value to the average customer and personally I don't ever see myself seeking out a website for their extra services that don't align with my budget, needs, wants, etc.

But I do however think business people can be a profitable part of their business. Times are tougher now, so maybe the corporate "flying" culture has changed, but back when I was flying around the US (once a month i might add) my boss sometimes even encouraged us to take the more expensive, more convenient, service-packed flights. Sometimes paying $100-200 more that the best available offer.

I agree with the general term that providing high value at a low cost is a good way to
success, but I am not sure where Etrip is providing this concept.


True, the service level is definitely in the high-end, but the low costs it should be
associated with do not seem present.


Instead Etrip has a pressure on the revenue streams as displayed on page 8 of the case:


- Only 35% of click will be forwarded to paid providers – industry standard was
70-100%


- Only 40% of the site’s visitors would generate clicks – industry standard was 75%


- An average link would generate only €0.25 – industry standard was €0.60


There seems to be a misalignment. Also the concept is very appealing to a personal experience, but the sales forecast look more like a company going for Economies of Scale.


I think it will have trouble unless it finds a way to efficiently lowering its costs.


/Anders

I think Janick has a point. the cheapest tickets sometimes are not the best choice. Owing to the rising of the oil prices, many airline company has overbooked their flights. I have an experience when I travelled to Europe with a friend of mine who bought a cheapest ticket online. She was hinderred from getting on the airplane because of some changes of the flight the airline company had made. I, however, had a regular could get on the plane (direct flight) without problem, but my friend's ticket was altered to be a one stop ticket. So she delayed more than 8 hours than I to arrive at the destination.

I think the ticket selling strategy varied drastically among various European airline comanies. That is why they keep the cheapest tickets on their own website. They are closely related to their selling strategy. I wonder whether Etrip can really propose a best price, best quality combination.

Janick_Edinger wrote:I am afraid that with the concept of ETRIP to attitudes collide.

1) When I want to travel as cheap as possible, then I try to save money wherever I can. Narrow seats, no food or drinks on the plan, less service. I do that because I am a student or someone who really wants to save money. So I am not willing to pay for something I might do on my own.

2) When I want to have a good service, because the flight is important to me, if book directly on the airlines website and rather spend 50€-100€ more than taking the risk of a delayed or cancelled flight or a poor service. People who would willing to pay for the ETRIP extra service won't use ETRIP at all.

What do you think about that? What is your experience?

And to those of you, who had been working already: How did it look like when colleagues of you had to go abroad?

From my personal experience, international companies usually have already signed a long-term flying contract with a certain company, such as America Express. So the secretaries actually don't need to search price for ticket, insurance, acommondation...etc. The situation is big companies don't want to waste too much time comparing price, because time is moneny! And they usually would love to pay for business class because that can help the business travelers to meet with more business men/women to build more connections.

Even now, in the economic downturn, America Express can also provide some lower price packages for companies to choose from. This should be the most delicious and the biggest pie to work on.

Janick_Edinger wrote:@Florent:
Of course, you are right. Most of the businessmen won't book their flights themselves. So we should have in mind that we are talking about secretaries doing it, when we say "businessmen". But if they are good secretaries they also will care about the price and have also time constraints.