Call It the Year of the Mobile Traveler

Travel-Related Searches Dominate All Other Sectors in 2010

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NEW YORK ( -- Whether 2010 finally shapes up to be the year for mobile, it already has a huge head start in one sector: travel. As a result, marketers with apps are raking in profits.

Priceline found that 35% of its customers were within one mile of the hotel at the time of booking.
Priceline found that 35% of its customers were within one mile of the hotel at the time of booking.
While mobile search overall has increased four-fold in the past year, according to Google, searches for travel-related terms have jumped 12 times and hotel-specific terms are up 30 times in the same period. Moreover, those travelers are booking differently than those doing so from a desktop, and are often choosing places to stay on the eve of their trip or once they have reached their destination.

The mobile-search traveler is likely to be on business. More than 60% of surveyed business travelers make reservations or bookings via mobile vs. nearly 40% of personal travelers, according to Google research. Car-rental service Avis says travelers with corporate accounts and BlackBerry devices have had a big hand in its 100% growth in mobile web reservations year over year.

But Avis is convinced road warriors on business are just the beginning. "The mobile traveler is going to be the more frequent traveler, the one that has a lot less time," said Gerard Insall, Avis' senior VP-chief information officer. "But over time, everyone who travels -- whether it's once or 10 times per year -- is going to be using mobile."

That's good news for travel marketers, who are seeing what Google Travel Managing Director Rob Torres calls "an incremental consumer." These consumers are finding more last-minute bookings in mobile, with some scrambling for hotel rooms or rental cars after they land rather than setting up travel plans days or weeks before on their desktops.

"What we're seeing [in mobile] is a different consumer," said Mr. Torres, travel managing director at Google. "What they're booking is actually different than what they're booking online."

In a recent study, budget travel retailer Priceline found that more than 80% of Priceline mobile app customers booked hotel rooms within one day of arrival, compared with 45% name-your-own-price customers online. Distance-wise, almost 60% of customers on Priceline's mobile app were within 20 miles of a hotel at the time of booking, and 35% were within one mile.

(Priceline attributes this to three main causes: A traveler's plans change last minute and consumers can make adjustments on their phones; with mobile bookings customers can get a feel for a particular area before booking a hotel; and mobile service simply allows travelers to procrastinate since it allows for bookings until 11 p.m. on the same night you need the room.)

"We've seen a pretty dramatic increase in mobile and, within that, we're seeing people making bookings, checking accounts, latest offers and flight status," said Brett Billick, Virgin America's director of customer-service management. "We're definitely making sales in mobile."

"I'm surprised that [the mobile app] is making as much money as it is, quite honestly," said John Peebles, VP-online marketing for Avis. The company said it's only had one month this year that app usage did not see double-digit growth in number of reservations month-over-month. Mr. Peebles cited one customer who's made 40 reservations this year alone.

While Avis, as well as hotel chain Hyatt, have tested search campaigns to reach the mobile customer, the car renter is less concerned with optimizing mobile search than updating mobile apps and websites to work better. "[Customers] want more functionality, it's not just about reservations; it's about service," said Mr. Insall. "We don't yet do [as] great a job managing the services in mobile [as we do with those] we provide to consumers on the dot-com."

Mobile visits to its website were so important to Virgin America that the airline recently scrapped its website with built-in Flash -- not viewable on iPhones -- in favor of a mobile-friendly format. "[Mobile traffic] is incredibly important to us; one thing we did recently is change our homepage module to not be Flash," said Mr. Billick. "We changed that because a lot of consumers were visiting us from their phones."

The airline recently launched a program with mobile loyalty service Topguest, which scrapes myriad social-media mentions and location-based check-ins to reward travelers for tweeting and checking in. For Virgin America, customers that check in to the airline's terminals or baggage claims on Foursquare or Facebook Places earn extra frequent flier points. According to Google, membership in travel rewards programs is also up from last year, among both business and personal travelers.

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