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No 2001-2 Wednesday,february 13, 2001

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  Rosenbluth appears more and more interested in Europe and…discounts  

Rosenbluth International and just announced the formation of a partnership between their two companies.

This appears to be a great opportunity for Europebyair that will instantly gain credibility on the European market.

Up till now, the Web site mainly focused on selling plane tickets but also offered hotel reservations and car rental services. The whole system is totally managed by Amadeus, which shows a lack of novelty compared to the other eTourism sites that use the same technology.

Many bugs can be noticed on the site and its browsing is not exactly what you'd call easy. What's more, a minimum of 72 hours is required before you can make an actual booking! And yet, every one knows that three whole days before you can make an online booking represents a major defect on the Internet.

This is the reason why it is not easy to understand what Rosenbluth could have been looking for in this partnership since Europebyair does not own any technology and it seems that its only advantage over its competitors lies in its discount transatlantic fares.

Indeed, this also represents the opportunity for Rosenbluth to set foot in Europe, an Internet strategy that is beginning to be peculiar to American web companies. This is how Travelocity just announced the opening of a web site in France in the near future, and this happens just after it opened a site in the UK and in Germany.

But the discount aspect is what seems to attract Rosenbluth here and the press release is very clear to this respect: " and Rosenbluth International will join forces to offer the best fares from their combined portfolio of discounted airfares."

The fact that a company such as Rosenbluth decided to use discount fares as the base of its strategy says a lot about the changes that recently took place in the eTourism sector.

We can see this with Delta Air Lines (see article in the same issue), which does not hesitate to promote its discounted offers and promotions among its business customers and also that seems very successful. Nothing surprising then that Rosenbluth decided to follow their lead.

You can notice that if you put together all these isolated strategic announcements, you get a good idea of what the eTourism will look like in the near future.

A few years ago only, discounters used to be viewed in the eTourism or the eTravel sectors as renegades by the rest of the trade. And now they are starting to be a model to them!

It is true that when price comparison is only a few mouse clicks away, online disloyalty can quickly become the rule.


Even though exclusive loyalty rates remain high for the eTourism web sites (at least this is the case in France according to the figures provided by BVA TFC Research), nobody can predict what is going to happen tomorrow. One can hardly deduce what the behaviour of the Internet users will be from the attitude customers prove to have offline since the two are completely different.

This is how the Internet "destroys" near monopolies. Not monopolies in the usual sense of the term but monopolies of behavioural habits.

It is not easy for a company to change its travel agency and even in the BtoC sector, habits tend to appear, based on both cases, essentially on trust.

But trust goes hand in hand with brand. And yet, we've often seen in the last few years that new eBrands that were totally unknown could still manage to create a faithful relationship in a very short time and a trust that proved just as strong as the one that existed with brands that had been known for a good few years. The success of Travelocity and Expedia well prove it.

In fact, the "Internet trust" also obeys criteria as sensitive as the price itself. Can I keep on trusting a company that wants to charge me 10% extra for a plane ticket or a holiday than a given eTourism site?

It proves more and more difficult for the brands that are already famous to prevent their customers from having this type of reaction, to explain to them that even though the price is higher, the service they have to offer is much better. If some customers are well able to understand this type of discourse, some others only pay attention to the price.

This is why I think, and these announcements prove it, that the discount will not remain the property of discounters much longer, but that all actors will have to offer their customers this type of product if they want to be able to customize them.

The attitude adopted by Rosenbluth and Delta Air Lines seems rather sensible to me. Too many professionals in the eTourism sector haven't yet understood the importance of a real Internet price policy. It will soon be too late.

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