SURVEY REVEALS 18% OF "WIRED TRAVELERS" BOOK ONLINE

Phoenix, AZ, November 4, 1998 -- More Internet users are booking travel arrangements online, but getting browsers to buy is still the number one challenge for Internet travel services, according to results from The 1998 PhoCusWright Travel eCommerce Survey. PhoCusWright, Inc., a leading independent strategy and research company for the online Internet travel marketplace, today announced findings from its landmark research study into consumers’ online travel habits and purchase preferences. The findings were unveiled at PhoCusWright Live98, the third annual online Internet travel industry conference.

An independent research firm, International Communications Research (ICR), conducted a random telephone survey of 500 "wired travelers" -- adult Americans who have traveled by air in the past year and visited a Web site in the past month.

Among "wired travelers," a whopping 80% have "looked" at Internet travel sites and 58% have checked prices. Approximately one fifth (18%) of "wired travelers" have used the Internet to book travel online. Additional findings are as follows:

Content is key.
Wired travelers are more likely to use the Internet than travel magazines or guidebooks to research and plan their trips. While only 10% of "wired travelers" who take leisure vacations "customarily" buy their air tickets for personal travel online, far more--a hefty 68%--look online to research and plan their personal travel.

Look-to-Book remains industry issue.
The majority of those who use the Internet to look at travel options do not purchase them electronically. Fifty-seven percent of "wired travelers" have "looked, not booked." Of those, 70% have bought the tickets later from another source, such as a travel agent or airline.

Travel and travel-related services are among top three segments for Web purchases.
Airline tickets and other travel products are among the three most popular products purchased online by "wired travelers". Among the 44% of "wired travelers" who have purchased online, 44% have purchased computers, computer supplies or computer software; 42% have purchased books; and 40% have purchased airline tickets or other travel products or services.

Online purchasing behavior driven by experience and frequency of Web usage.
Length of experience on the Web and frequency of Web usage are the best predictors of online buying. Among the "wired travelers" who use the Web less than weekly, only 23% have made an online purchase. But among those who use the Web just about daily, far more, 56%, have bought something online.

Security and privacy remain barriers to purchasing.
Most non-buyers express reluctance to jump into eCommerce anytime soon. A hefty 75% say they are not likely to buy anything online in the near future. They worry about credit card security (82%), personal privacy (79%) or would rather speak with a knowledgeable salesperson (77%).

Travel agents are a big reason why travelers resist online services.
Among the vast majority (82%) of "wired travelers" who have not bought travel online, nearly half (48%) say it's because they have a travel agent they know and trust. Having a travel agent is a significant barrier to buying travel online, but not an insurmountable one.

"The quantitative research derived from PhoCusWright’s 1998 Travel eCommerce Survey is truly ground-breaking for our industry," said Philip C. Wolf, president and CEO of PhoCusWright, Inc. "This study shows that consumers desire the best price, but are fearful about security and privacy. The more experienced consumers are with the Internet, including eCommerce, the more likely they are to purchase travel services online," he added.

Field work for The 1998 PhoCusWright Travel eCommerce Survey was conducted by International Communications Research (ICR) of Media, PA. MSN Expedia, Internet Travel Network (ITN), Preview Travel, The SABRE Group/Travelocity and PhoCusWright, Inc. jointly sponsored the study. More information is available by contacting PhoCusWright, Inc. at +1 860 350-4084 or by sending an email to lsileo@phocuswright.com.

PhoCusWright’s third annual PhoCusWright Live98 conference gathered leading travel industry executives from companies such as Amadeus GTD LLC, Biztravel.com, Inc., Cahners Travel Group, Internet Travel Network (ITN), iXL, Inc., MSN Expedia, Orbit Network, Inc., Orlando Sentinel Interactive, Preview Travel, Inc. and The SABRE Group/Travelocity as well as PhoCusWright analysts and more than 500 travel industry executives for discussion of the driving issues in the online travel business.

Sherman, CT-based PhoCusWright is a leading strategy and research company specializing in the online Internet travel marketplace. It provides consulting services; customized research and private seminars; publishes The Insighter and The PhoCusWright Report; commissions surveys and user studies; and instructs a class at New York University’s Center for Hospitality, Tourism and Travel Administration.