Online Travel Business: The 4 Business Models

The Internet offers an effective means for developingto plan and book their own trips. It has revolutionised
a single and sustainable electronic infrastructure forthe travel industry as a whole and instigated a trend
information gathering and business transactions foraway from the customer using a travel agent.
both travellers and suppliers. It is an ideal method forThere are four Internet business models that can be
people to source information on travel. It is an essentialapplied to the travel industry. The business models and
for travel-related Websites to offer useful, pertinentexamples of businesses within them are as follows:
and easy-to-find information alongside a booking facility1) The merchant model, which brings buyers and sellers
if appropriate.together. It could be argued that this model is
It can be used to fully research a destination, book alleffectively an online travel agent. Websites in this
aspects of the holiday including travel andbusiness model category include Travelocity who have
communicate others who have the same ideas orrecently purchased and Expedia - an offshoot from
have been through similar experiences. It givesMicrosoft.
travellers an excellent opportunity to compare and2) The advertising model, providing valuable travel
contrast everything on offer before they make ainformation whilst generating revenue through various
purchase.adverts. The significant advantage of this model is its
The information available online is continually beinglow cost base. A website in this business model that
reformatted and presented in a more logical,provides information on the UK is
easy-to-use and read format. The volume of3) The direct model allows the service provider
consumers that rely on this information to makethemselves to deal directly with the general public. First
travel-related decisions will therefore continue to rise. Inof all, British Airways is the longest established and has
addition, features and benefits of using the Internet toa large marketshare and conventional competitive
research and book holidays are improving and beingadvantage. Secondly, EasyJet have established the
added to all the time. For example, consumers noInternet as being key to their core competency.
longer have to receive printed tickets from the travel4) The community model is one of the longest
operator. They simply print out any information thatestablished operating models on the Internet without
they require themselves after they receive ithaving a history of generating a significant revenue
automatically via email.stream. Two websites reviewed that fall into this
The 'Net' has meant that people can now easily plancategory are Lonely Planet - based upon the books
trips for themselves. This has not only opened up athat have been published for more than thirty years,
greater amount of discounts available to the generaland - a community of individuals who have a passion
public, but also given people the fun and enjoyment offor travel.
planning and booking their own trips.Although it can be argued that some websites are
Prior to the Internet, travel agents were the primaryusing a mixture of several business models, it is
source of information and facilitating bookings withininteresting to acknowledge that just because a
the travel industry. However, the onset of Netbusiness generates the majority of its revenue online, it
popularity has seriously impacted upon the futuredoesn't mean that conventional business models can't
success of a telephone or face-to-face based travelbe applied to them.
agency. The Internet now allows individuals the ability