When Dev and I began exploring ideas after PlayCafe, I considered what I would personally want to use. One idea immediately came to mind: an eHarmony for travel.
I am seriously considering living abroad. I’ve been in the Valley for 12 years now and while I love it, I feel some wanderlust. My criteria for a new place are:
- Within 5 minutes of a beach, preferably warm-water
- English-speaking, since the only other language I know more than ten words in is dead
- Relatively low cost of living
- Safe and somewhat modern
The question is, what are all the cities in the world that match this? The answer is surprisingly hard to find.
Travel booking sites like Expedia and travel guides like LonelyPlanet assume you know your destination. Travel social networks like Tripwolf have people to ask, but that’s manual and hit-or-miss. You can Google terms and guess like I did – New Zealand and Australia fit – but that’s inefficient. It took my roommate to suggest Costa Rica.
What’s needed is a data-driven, travel-matching system that shows you which cities match your needs. eHarmony does this for dating: tell it who you are and it shows you matches. Travel sites do the equivalent of asking you possible names of who you’d like to date. When a search engine asks you for more information than you have, it’s not doing its job.
Travel is a $100 billion market and not going away even in a recession. A friend in the industry says about 70% of travel is for business and non-discretionary, and of the 30% consumer market, about 70% goes to top 20 cities. Assuming this search engine wouldn’t change top 20 behavior much, that means the long tail of consumer travel is about 9% of the total travel market, or $9 billion. That’s still pretty big.
Note this will be useful for both the vacation and permanent moving market. The latter is especially valuable since people spend tens of thousands moving and that decision must be vetted more.
The site could collect however much information travelers want to give:
- Environment: temperature, humidity, rainfall, landscape types
- Culture: languages spoken, religions, ethnic diversity, openness to foreigners
- Government: tax rates, type of system, economic and social freedoms
- Safety: crime rates and types, natural disaster patterns
- Things to do: popular sports, activities, night life, cuisine options, tourist spots
- Price: cost of airfare, hotel, car, food, rent, activities, schooling, housing prices, health care
Some travelers will only need one or two search filters; some will have highly detailed needs. The site can offer wizards to guide choices, wikis for user reviews and content, and forums to connect with other searchers.
Anything that gets people to travel is lucrative. A typical one-person, three-day trip costs about $1,000 in airfare, hotel, car, food, and activity packages. Longer or family trips are at least several thousand. Each booked item can earn a commission of $20-200+; lead-generation in travel is big business.
The site’s search and data APIs could create demand and convert uncertain buyers for several types of partners:
- Travel booking sites that can increase purchases by showing travellers their best matches. An Expedia VP said their users visit 10-15 times before buying. Reduce that just a few visits and Expedia will be thrilled.
- Transportation vendors such as airlines, hotels, cars, and cruise ships that want to spark demand.
- Travel guide sites that want to suggest your best destinations to sell relevant guides and ads.
- Even weather sites that want to monetize their information better. “It’s 72′ and sunny in Hawaii today. See if Hawaii is right for you!”
Partnerships are essential for this idea to gain scale. Travel is too crowded a market to compete without a lot of partners or a ton of funding. Fortunately this offering is unique and valuable enough to gain partner interest. When I interviewed a VP at Expedia on this, he was ecstatic at the prospect, offered access to Expedia data, and began selling me on why I needed to start this.
Because travel is big business, it’s very crowded. Travel keywords cost tens of dollars per click on AdWords. Hundreds of sites focus on SEO to get a sliver of Google juice. There isn’t that much innovation in travel but it’s still a ruthless market.
There isn’t much out there that is a direct competitor.
- Uptake has some matching features and categories of vacations you can choose, but still requires you to name a destination city, defeating the whole purpose of matching.
- City-data.com has a lot of detailed data on cities and a surprising 6 million monthly visits, but no matching system and an awful interface straight from the playbook of Craigslist.
- MyIdealBeach is a nice matching pilot from Orbitz, but only shows beach destinations from a limited set. Says Orbitz’s press release: “Our research has shown us travelers want a different, better way to search for complex trips than by dates and destinations.”
Has anyone seen anything else like this?
Starting this is a bit time-consuming but fairly straight-forward.
- Find reliable sources for the above data. Start with a few main traits, then expand as users tell you their needs. The Weather Channel, Expedia, Fodor’s, the CIA factbook, and many other sites have this data and some already have APIs.
- Build a basic search engine to query the data on keywords and pre-set options.
- Build an intuitive interface. Kayak’s is nice and could be easily copied.
That would yield a usable beta. You could then add social networking and wikis, build APIs, integrate commission programs, develop partnerships, and watch the dollars fly in.
Why we didn’t do it
Dev and I were open to starting this, but had a few key concerns:
- Most people don’t move or take vacations often. We’d be lucky to have visitors return every six months. High user churn means constantly having to find new ones or targeting the small sliver of frequent, high-end travelers.
- Search engines are a pain to market. This one is actually a little word-of-mouth viral in that people often travel together and may share search results and itineraries. Still, gaining search share is a bitch when Google looms.
- Barriers to entry are low. Any of the major travel sites could copy this in a few months if they woke up. If this site got traction, they might be more likely to buy us than build but that still sets a ceiling on potential acquisition values. The site would need to cultivate sticky content like reviews or a social network to create a barrier.
I do believe just moderately good execution could make this a $5-20M business. What do you think?
P.S. I’m openly releasing this idea into the wild. If you steal it and strike it rich, you owe me lunch.