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The Sum Of All Fares

How Online Booking Sites Influence You

By Michael Shapiro
Special to The Washington Post
Sunday, July 28, 2002; Page E01

Are most of the leading travel booking sites trying to nudge you toward airlines they favor? You bet, say Consumer Reports and leading online travel analysts. Are they still good places to shop for airline tickets and other travel products? Absolutely, say the same observers.

Shopping online for airline tickets has never been as simple as the sites would have us believe, and it's only getting more complex. The increase in alliances among airlines and travel booking sites makes it even more important to carefully examine as many options as possible -- both online and through more traditional channels. "You may not want to comparison-shop," says Consumer Reports Travel Letter editor William J. McGee. "But it's more necessary than ever."

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How do travel sites try to steer you toward favored suppliers, and why are they unable to show fares for all airlines? Here are some examples:

• Travelocity has a Featured Airline banner for many of its routes. If you click on it, you'll see only fares from that airline, rather than a comparison of all fares. Though veteran online travel shoppers know this banner is an ad, some newcomers may not realize that clicking on "Search All Airlines" may lead to a cheaper fare.

• Above its fare results, Expedia shows several rectangular panels featuring selected airlines and fares. Expedia says its panels show the best prices. But Henry Harteveldt, a senior analyst for Forrester Research, says they show bias, because when fares for competing airlines are the same, Expedia tends to feature carriers with which it has marketing agreements.

• The three major booking sites -- Expedia, Travelocity and Orbitz -- don't display Southwest Airlines' fares, which means that if you search just at these three sites, you'll often miss the best deal. The reason is that Southwest has chosen to sell online only through its own site, Southwest.com, and through the booking tool SideStep (www.sidestep.com), which redirects bookings to Southwest.

• JetBlue fares are not displayed on Expedia, though many of the new airline's flights are featured on Travelocity. Orbitz shows JetBlue fares and flight times but doesn't book tickets on the budget carrier -- instead it tells customers to contact the airline directly.

Ironically, according to the Department of Transportation, the one major travel-booking site that's not showing bias is Orbitz (www.orbitz.com), which is owned by five major U.S. airlines.

When Consumer Reports Travel Letter analyzed leading travel Web sites in June, it found the best deals overall at Expedia (www.expedia.com) and Travelocity (www.travelocity.com), with Orbitz just behind. However, the CRTL report didn't include the booking tool SideStep, which in our latest round of anecdotal testing found the best fare on three of four routes (see box at right).

Given the alterations in the online travel landscape spawned by recent commission cuts, we thought it was time for another reality test. Our chart compares fares from Expedia, Travelocity, Orbitz, SideStep and Southwest. (We included Southwest, the leading U.S. budget airline, because it doesn't permit its tickets to be sold through most other outlets). Though it's risky to draw broad conclusions from a limited comparison, our research shows that simply checking the Big Three (Expedia, Travelocity and Orbitz) isn't enough to ensure you'll get the best deal.

Bias, of course, is not unique to online travel, which was the single largest online commerce category, with $2.4 billion in revenue last year. Pay-for-placement also exists in supermarkets, bookstores and all sorts of other marketplaces, as sellers buy premium shelf space. But most consumers know they may find less expensive potato chips down the aisle -- when shopping online they might not realize that cheaper fares or more convenient travel times may be just a click away.

Sin of Commission?

Earlier this year, most leading U.S. airlines completely cut commissions paid to travel agents for selling domestic airline tickets. In theory these cuts also apply to online agencies, but in practice, large agencies like Expedia and Travelocity have enough muscle to insist on payment for ticket sales.

Case in point: When United Airlines threatened to halt commissions last March, Expedia stopped displaying prices for United's tickets. Consumers could still buy United tickets on Expedia, but they had to make an extra click to see United's prices, putting the airline at a competitive disadvantage. This game of hardball lasted less than 24 hours, ending when United agreed to pay commissions to Expedia. As Expedia executives are fond of saying: "We don't work for free."

If you're aware of the major sites' biases and understand how they work, it's possible to craft a sensible search strategy and find some great deals. Expedia and Travelocity now offer a wide variety of exclusive Web specials that can be far lower than standard prices, and Orbitz has access to many deals previously offered only through airline sites.


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