Research showcase – Search is now a vertical reality

With Kayak and SideStep looking to increase their efforts in Europe, Hitwise UK director of research Heather Hopkins assesses the impact these vertical search engines have had on the market here and in the US There’s been a great deal of buzz about travel vertical search in the past year, and the recent announcements by…

With Kayak and SideStep looking to increase their efforts in Europe, Hitwise UK director of research Heather Hopkins assesses the impact these vertical search engines have had on the market here and in the US

There’s been a great deal of buzz about travel vertical search in the past year, and the recent announcements by Kayak and SideStep to increase their efforts in the UK have fuelled this momentum.

There are many long-established travel price-comparison sites in the UK. But travel vertical search sites are a different breed – searching inventory from multiple travel sites based on a specific date range and destination.

In the week ending May 20 this year, there were 1,613 sites in the Hitwise travel agencies category. Among the top 100 travel agencies there were 11 that we would classify as either price comparison or vertical search. These sites accounted for just over one in every 10 UK visits to the category.

In the US, there were four travel vertical search engines among the top 100 travel agencies based on US visits the week ending May 20. SideStep was the most visited of the four, ranking 10th among travel agencies websites based on share of US visits. Kayak trailed slightly, ranking 11th. (Hitwise does not track visits to the downloaded HTML application of SideStep but, instead, visits to the SideStep.com website).

Many have predicted that the entrance of additional travel vertical search websites in the UK will give control back to inventory holders. However, Hitwise analysis shows this may not be the case. While in the UK, the greatest gains in market share in the past year have been by operators, hotel brands, airlines and car hire, Hitwise analysis reveals these are not the likely beneficiaries of stepped up efforts from travel vertical search engines.

While the UK market is arguably more sophisticated for online travel, a comparison with the US market provides a good starting point, where Kayak and SideStep are more established players.

In the UK, destinations and accommodation is the largest sub-category and transport enjoys a relatively larger share of visits – indicating a stronger position for inventory owners such as airlines, hotels, and car hire. By contrast in the US, travel agencies take the largest share.

The relative strength of inventory owners in the UK also holds true when looking at the top-ranked sites in each market. While in the US, six of the top 10 travel websites are travel agencies, there are only two travel agencies among the top 10 in the UK – one of which is Thomson Holidays – which owns its own inventory.

Consider also the downstream visits from SideStep and Kayak in the UK – both of which are profiled in detail in the following sections of this article. In the week ending May 20 2006, the number one downstream category for both SideStep and Kayak was travel agencies.

SideStep sent 33% of its traffic to travel agencies, with Orbitz the main beneficiary receiving 10% of the site’s traffic. Kayak sent 38% of its traffic to travel agencies with Orbitz and Cheap Tickets each receiving 7% of the site’s traffic.

While many other factors affect the skew toward inventory owners in the UK, these factors indicate that a greater presence from Kayak and SideStep may in fact favour the agencies.

According to Hitwise data in the US, SideStep has experienced a steady share of visits, with a modest 6% growth year on year in the week ending May 20 2006 when it ranked 10th among travel agencies.

SideStep has proven adept at attracting visits from US searches for generic terms and searches for travel brands. For example, SideStep was among the top 10 sites receiving US visits from ‘airline tickets’, ‘cheap airline tickets’, ‘cheap hotels’, ‘jet blue’ and ‘comfort inn’ in the four weeks ending May 20 2006.    

In the UK, SideStep UK ranked 39th among travel agencies in the same week, a rapid growth since the site’s February launch. Analysis of the search terms sending visits to SideStep UK reveal that the site is gaining visits from searches for travel brands.

For example, the term sending the highest share of visits to SideStep UK in the four weeks ending May 20 2006 was ‘travelodge’. Other brands among the top terms sending visits to SideStep UK were ‘newmarket holidays’ and ‘go airlines’ as well as brand misspellings, including ‘esayjet’ and ‘ryan air.com’.

Hitwise recently published a white paper on Search Engine Brand Management, outlining how online marketers could follow steps to minimise the visits from brand searches that go to competitors.

Kayak has experienced strong and steady growth in market share in the US with a 70% rise in visits year on year to the week ending May 20 2006. In the UK, where Kayak is a relatively new entrant, the site ranked 159th among travel agency websites during that same week and has seen its share of UK visits increase more than two and a half times year on year.

In the US, the site referring the largest share of visits to Kayak was Booking Buddy, which accounted for 11.7% of visits the week ending May 20 2006. There is a prominent link on the Booking Buddy homepage to Kayak and this partnership has bolstered Kayak’s position in the US.

Kayak seems to have carried over its strategy of partnering with a referral site to the UK. Air Ninja, a site similar in content to Booking Buddy, was the #2 site sending visits to Kayak accounting for 9.4% of upstream visits in the week ending May 20 2006.

SideStep and Kayak are unlikely to revolutionise the ways UK consumers search for and book travel as UK consumers are quite accustomed to using price-comparison and vertical search sites to find travel deals.

However, it is possible that these sites will provide some relief to the online travel agents who have seen their market share of visits erode over the past year. Inventory owners would be wise to watch carefully as these vertical search engines increase their focus and presence in the UK market.

Learn more about how to protect your brand through search engines with the Hitwise UK white paper on Search Engine Brand Management, or for additional analysis of the Travel Vertical Search space in the UK, request a copy of the Hitwise Search Research Note at Hitwise.co.uk or by e-mailing heather.hopkins@hitwise.com.