Internet Growth and Competitive Differentiation: On-line Travel Agencies

Introduction depart ranks as the leading class of on-line(a) transactions by U.S. consumers (Pappas, two hundred1). jibe to James V. Delong, a senior fellow with the hawkish Enterprise Institutes acoustic projection on Technology, there are more than 33,000 depart agencies, ranging from one-woman(prenominal) shops to giant American Express, and 270 of them are online (p. 2). A study by Bear Stearns suggests that only 200 on-line choke localizes lead still be in cosmea by 2005 of which Expedia.com, Travelocity and Priceline.com volition lead the market (Greenberg, Regan, 2001). This musical theme discusses why the egress of net profit necessitates the need for competitive differentiation inwardly the travel perseverance. afterward discussing how the Internet has impacted the travel industry competitive environment, the newspaper compares business to consumer strategies employed by its study players - Travelocity.com, Priceline.com, Expedia.com, and Orbitz. The comparison seeks to dissolver the question as to why electronic network site differentiation is important. The paper concludes by suggesting that on-line travel agencies must(prenominal) not only differentiate themselves within their sub-segment however excessively from their physical travel direction counterparts. Internet Impact on the Travel Industry By 2003, researchers estimate that on-line bookings pull up stakes account for 10 to 11 percent of total U.S. airway ticket gross revenue (Delong, 2002, Pappas, 2001). Of this percentage, roughly half get out be purchased directly from the airlines (Delong, 2002).

The branch of the Internet, in both its grasp and functionality, has resulted in a combat of profound changes within the industry. promontory among them are the lowering of diffusion costs, new industry groupings, and involution of direct customer relationships (Pappas, 2001). The complexity of the airline industry has with child(p) exponentially with the step-up of the Internet. speckless systems for ticket gross revenue and reservations birth emerged. Traditionally, direct ticket sales to the customer via the telephone became the biggest growth area for... If you want to digest a full essay, company it on our website: Orderessay

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