40% of booking failures caused by technology.
Monday, 24th August 2009
Source : Stephen A. Joyce
iPerceptions recently published Hospitality Index report shows that over 40% of customers failed to complete a booking on a hotel website because of booking or navigation problems.

Last week I had an opportunity to talk to Claude Guay, formerly an analyst with PhoCusWright but now the CEO of iPerceptions, an analytics company based out of New York.

iPerceptions recently published their Hospitality Index report around the same time that Forrester research came out with their report indicating the customer satisfaction in the Travel Industry has continued to decline.

From a technologists point of view, the thing I found most interesting about the report was the fact that over 40% of customers failed to complete a booking on a hotel website because of booking or navigation problems.

Price on the other hand only accounted for 13% of customers failing to complete a booking. That seems to me to be a huge wake up call for on-line travel companies.

What is the cause of these problems? Well, without analyzing the sites directly, it is hard to say, but I can make some general observations based on hotel sites I have reviewed (both large and small).

1. Many reservation systems focus on the process rather than the customer need.

Claude and I seemed to agree on the idea that because hotel reservation and property management systems have been around for a long time and, to some degree, the technology is strongly ingrained in some organizations, that the front-end booking interfaces are much more in line with traditional agent style booking experiences rather than a customer centric booking style.

This is reinforced by the results of the study which shows that the majority (over 45%) of the users who failed to complete the booking were first time visitors.

2. The booking process, on average, takes ten to twelve clicks.

It is proven that the more steps a customer must go through to complete the booking, the greater the likelihood that they will abandon the transaction. Does the customer really know the difference between your standard room and your deluxe room? Do they really want to see all that unformated text that gets spit out by the GDS? (You know the one, it's all in upper case letters and reads like a brochure).

Focus on simplification, reducing choices for the customer rather than increasing them, and shorten the track from choice to purchase.

3. Assume the customer has never booked a hotel in their life and build the experience for them.

The iPerceptions report clearly showed that the more experienced a customer was, the less likely they were to abandon their transaction. Simply put, once a customer has learned your booking process they will probably book again. But can a hotel really afford to have over 40% of their potential customers NOT book just because they couldn't figure out how to book a room from you. Think about it, they just want to do business with you, make it easy for them to do so.

There are a lot of hotel booking engine technology providers and, for the most part, they all seem to have the same basic booking interface. If the iPerceptions report is correct, what it should be telling these developers is that they need to re-think what they are doing and focus on conversion and experience.

The benefit of working in an emerging space like tours and activities, is that we don't have the same technological baggage to deal with. In part, that's why we we have been able to be more innovative in designing the booking process for Rezgo.

One very valuable lesson I have learned is that you have to think outside your comfort zone if you ever expect to be truly creative.

Stephen A. Joyce has been working as a travel & tourism technology consultant since 1995. In 2005 Stephen and his company, Sentias Software Corp., began development on Rezgo.com, a next generation Web 2.0 tour and activity booking engine for SME travel suppliers and tour operators. In June of 2007, Rezgo.com was officially released and now boasts a user base of 650+ companies.

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