Web Traffic Drops 14 Percent at Travel Sites

(MoneyWatch)  After years of growth and gaining the eyes of millions, online travel sites Travelocity, Expedia.com and Orbitz experienced their first real decline -- and it's a big one. Visitors to Web travel portals dropped 14 percent, or 38.2 million, says ComScore Inc., a market research company. But some companies, like Priceline.com and Kayak, are blossoming.

The breakdown of online travel went like this:

• Expedia: -25 percent
• Orbitz: -23 percent
• Travelocity: -16 percent
• Priceline: +24 percent
• Kayak: +93 percent

Apparently the Chicago-based Orbitz knew the downturn was coming, saying it planned to lay off about 10 percent of its workforce by the end of the year. The statistics were based on October 2008 and compared year-over-year. The report is troubling because October is typically the month where travelers plan winter holidays or tropical getaways. ComScore's report only included U.S. customers.

"What's happening in 2008 is a universal buckling down," Sara Stevens, vice president of ComScore, told the Chicago Tribune.
Despite the buckling down, Priceline and Kayak both grew their audience, perhaps because they both cater to the "budget-minded traveler," more so than other sites. "In tough economic times, people care a lot more about the money they're spending," Drew Patterson, vice president of marketing for Kayak, told the Tribune. "In that environment, we can be a lot more successful."

It shouldn't be a surprise that Web sites offering comparison-shopping (Kayak) or allow customers to make their own bid (Priceline) would be popular in a tough economy. It kind of makes Orbitz's take-it-or-leave-it price seem antiquated and inflexible.

At a time when airlines are hurting and realizing they must cut costs to stay competitive, it shouldn't be a surprise the front-end of the travel experience would be similarly affected. By offering fewer choices and less budget-friendly alternatives, an online travel site can become less and less relevant to the tech-savvy, and often price-conscious, audience that uses it.