Expedia faces “viable challenge” in UK

The combined force of Travelocity and lastminute.com will present a “viable challenge” to the Expedia’s dominance of the online travel sector in the UK, Hitwise believes.

The online competitive intelligence service described the planned £577 million takeover of lastminute.com by Sabre-owned Travelocity as heralding continued consolidation in the travel industry.

While Travelocity is the second most visited travel agency website in the US, the firm has struggled to gain a stronghold in the UK.

Hitwise UK general manager Simon Chamberlain said: “Expedia has been extremely successful in the UK, competing with lastminute.com as the favoured online travel agency among UK consumers.

“Travelocity has enjoyed a similar position in the US and the acquisition of lastminute.com may present the most efficient path to better market penetration in the UK market.

“Continued fierce competition and shrinking margins have led firms to pursue scale as the road to profitability,” he added.

Travelocity is the second most visited travel agency website in the US, while lastminute.com holds a similar position in the UK for April 2005, according to Hitwise data.

Expedia is the leading travel agency site in both the UK and US, “but the combined forces of lastminute.com and Travelocity could, over time, present a viable challenger to this leadership,” Hitwise said.

Hitwise search intelligence data shows that “travelocity” is the term which sends the largest volume of visits to travel agency websites in the US (2.82% of searches), followed by “expedia” (2.35% of searches) for the four weeks ending May 7.

By contrast, “travelocity” is the 23rd most popular search term sending visits to travel agencies in the UK. For volume of searches, “lastminute” is a stronger brand in the UK than Travelocity but “expedia” has a significant lead on this measure.

Top 10 Travel Agency sites in the UK by market share, April 2005 (Hitwise data)

1) Expedia.co.uk www.expedia.co.uk 9.23%

2) lastminute.com www.lastminute.com 6.71%

3)  Thomson Holidays www.thomson-holidays.com 4.34%

4) Teletext Holidays  www.teletextholidays.co.uk  4.06%

5) First Choice www.firstchoice.co.uk 2.97%

6) MyTravel UK www.uk.mytravel.com 2.58%

7) Cheapflights.co.uk www.cheapflights.co.uk 2.54%

8) Thomas Cook www.thomascook.com 2.46%

9) Airline Network www.airline-network.co.uk 2.17%

10) ebookers.com www.ebookers.com 2.10%

Top 10  travel agency sites in the US by market share, April 2005 (Hitwise data)

1) Expedia.com www.expedia.com 21.42%

2) Travelocity.com www.travelocity.com 16.10%

3) Orbitz www.orbitz.com 9.79%

4) Cheap Tickets www.cheaptickets.com 8.24%

5) Yahoo! Travel travel.yahoo.com 6.70%

6) Hotwire www.hotwire.com 5.67%

7) ITN.net www.itn.net 2.97%

8) Priceline.com www.priceline.com 2.36%

9) Vacations To Go www.vacationstogo.com 1.90%

10) AMXTravel.com www.amxtravel.com 1.52%

Report by Phil Davies