Internet

1.0 INTRODUCTION

The Internet is about saving time, saving money, and the potential of the Internet has barely been tapped. New methods of taking advantage of efficiency are become widely accepted as access to high-speed broadband Internet connections become a common sight. Users of the Internet, both business and consumer are multiplying around the globe, and many companies are earning terrific profits in the process of serving those users. The long awaited phenomenon of “convergence” of entertainment, computing and communications has arrived, which lead many companies going into E- Commerce.

So what is E – Commerce? Electronic Commerce is any electronic business which conducts its business over the internet with commercial transactions carried out, facilitated or enabled by the electronic exchange of information via the Internet, electronic data interchange, intranets, dedicated telecommunications or e-mail. They are also known as electronic transactions that involve the change of ownership (purchase or sale) of a product or service. Transactions can be buying and selling, serving customers, collaborating with business partners, or administrative transactions. Transactions can be internal to a company and affect the internal supply chain process, or be across firms, affecting external supply chain processes.

To remain competitive over their competitors, many industries are going into E – Commerce. In this report, from a list of 15 travel agencies, we had filtered and identified 3 agencies for us to conduct our research. We will go into details on the reason more and more travel agencies specializing in air tickets are going into E – Commerce. We will compare, contrast and rate the 3 travel agencies and analyze each individual website about the marketing approach, business model segmentation, business revenue model and their each individual strengths and weaknesses from customers’ point of view.
After analyzing the 3 travel agencies, we will explore the critical factors in building an online air-ticket selling site. We will analyze the advantages and disadvantages of travel agencies going into E- Commerce and whether the feasibility of air travel agencies venturing into E – Commerce. We will also discuss the impacts of online air-ticket selling site on the traditional travel agents. With E- Commerce, will the traditional travel agencies lose out in the long run or will they still have the ability to remain competitive in this service sector? Recommendations will also be made on how a successful travel agency website should work to provide a good and satisfying online shopping experience for their customers if they really intend to go into E – Commerce.
2.0 SWOT ANALYSIS

SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues. SWOT stands for strengths, weakness, opportunities, and threats. Strengths and weaknesses are internal factors. Opportunities and threats are external factors.

There are several main strengths of the online travel agency, which make these agents establish stably. First of all, due to the special distribution channel, Internet, costs of firms are sharply reduced. It certainly helps in avoiding costs such as telephone and fax bills, rentals, and payroll. Secondly, Internet enables firms to serve customers from nationwide or worldwide, depending on their business scope. It is an effective approach for firms to capture more market shares with almost zero marginal cost. Thirdly, it is expected to grow hugely in near future because of global trend of tourism and improved quality of education. At present, it is estimated that about 80 percent of airline tickets, 85 percent of tour packages and more than 95 percent of cruise packages are still booked through agents. On the other hand, online travel agents who only currently occupy 5%-15% market share have potential competence to capture more shares through sensibly correcting their marketing strategies and IT innovations.

Meanwhile, some weaknesses and shortcomings of this industry can also be seen. Firstly, customers using the Internet need to be more educated and intellectual because of the complicated setups and processes. Younger children, elderly, and those who are less educated are not likely to access firms’ website using Internet. It seems that this limit the firms’ network of customers. Secondly, purchasing online may sometimes be time consuming and the results returned maybe limited. Most of the time, it only shows a handful of options. Customers still need a one-on-one consultation with a travel agent in order to find out the dates available, as well as the best bargain for air tickets or hotel accommodations. Thirdly, the payment methods are very unitary. In general, most agents only accept credit cards and some agents only accept a particular credit card for example American Express. In reality, there are many possible and convenient approaches to do a transaction. For example, through cash, banking nets, cheque, money order and so forth. Since this limitation applies, some customers such as the low-income category who are not eligible to apply credit cards, have to give up their bookings or justify their choices. The typical group, which is excluded by the payment methods, is students. This is especially so for university students who normally have a part time job and yet need not shoulder family expenses.

Now, we shall elaborate on the opportunities that an online travel agency have. As mentioned earlier, the innovation of Internet provides another market platform for firms to earn profits. Internet facilitates consumers to gather information quickly and customers are able to complete the purchasing process within a short time. The communication between customers and firms are quick and easy. It is convenient for firms to handle each case efficiently, and try to meet customers’ specific requirements. Another opportunity is that some travel firms can possibly survive the intensive competitions by engaging themselves online. Some small agencies have closed for various reasons in the past few years, but none were members of the network. Some online travel agencies are actually joint ventures or strategic alliances. Zuji, for example, has a distribution of agents all around the world. Small firms earn “survival profit” by joining a network and compete with other direct and indirect competitors.

Finally, the online travel agency faces a number of threats. Firstly, an ordinary travel agent can provide face-to-face services to customers, regardless whether they are elderly or low-income earners. Face-to-face services are useful in building up good long-run public relationship with customers. Some persuasive customers are more likely to accept suggestions by the agents, and those suggestions may be the most profitable to the agents. Secondly, since majority of the people are risk averse, customers would be afraid of fraudulent activities resulting from the online purchase or booking of air tickets through online travel agency. In contrary, ordinary agents are much less likely to be doubted.

*A summary of the analysis can be found in the appendix.

3.0 MARKETING STRATEGIES

The key element of establishing a successful business is to build the right relationship with right customers through the process of marketing. A good marketing effort can be accomplish easily by finding out what customers want, setting out to meet their needs with a profit margin. In this report, the three selected online travel agencies to be studied are Zuji, AirGorilla and Quest Travel. They conduct their business using different marketing approaches such as target marketing, marketing strategies and business revenue model.

3.1 Target marketing
Customer is always be the first priority and the market selected by a company as the target for their marketing efforts is critical since all subsequent marketing decisions will be directed toward satisfying the needs of these customers. Market segmentation is the first step in target marketing.

Not surprisingly, the three selected travel agencies have chosen the same way of segmenting the market— based by consumers’ behavior as the main direction. The common characteristics of the people in the preferred segmentation are simplifiers and surfers, meaning that they like the convenience of trading online and they are used to using the web to locate information.

AirGorilla, a US-centric traveling agency, expands its business extension globally through internet rather than concentrating on just the US domestic market. Both company and customers can benefit from internet. As we all know, internet is a convenient information channel for global customers wherever they are and is a relatively low cost distribution channel to firms. Global customers are able to access their own website to obtain relevant information about services such as air ticket, hotel etc. With information on their fingertips, decision making is a relatively easy task. Customers of online travel agencies share some common characteristics. They are expected to be proficient in English Language due to the lack of other nation languages translation on websites. In addition, targeted customers are also assumed to be in the middle class to be able to financially afford the traveling costs and possessing a valid credit card to process an online payment. They must be computer literates who consistently share the characteristics mentioned above.

Zuji is an internationally well known traveling agency. Zuji provides websites with different regional settings such as choices of languages and traveling options. Besides, we can also see that Zuji offers tickets sale more then tour packages. Hence, its targeted customers are probably global travelers who love to travel on a free and easy basis and need not be proficient in languages. Similar to AirGorilla, target customers of Zuji are expected to be to be the middle class, who can afford traveling costs and possessing a valid credit card to process an online payment.

QuestTravel emphasize more on holiday tours rather than commercial traveling. It specialize in guiding and recommending users to the attractions in places such as Australia, New Zealand, the Pacific Islands, Asia, Africa, the Middle East, the Indian Ocean, North America, South America, and the Caribbean. It has a less global focus and its targeted customers are likely to be travelers who are non-business associates.

3.2 Revenue model
It is reasonable to say that every business has the same objective— profit making. For travel agency, the main source of their revenue comes from the service they provide and the products they sell. But since they are online travel agencies, the Internet provides them better profit making opportunities compared to the traditional travel agencies. The revenue strategy of online agencies is dependent on their revenue models.

Zuji uses a combination of fee-for-service revenue model as well as Advertising-supported revenue model to generate profit. Zuji charges a fee while providing users the convenient services such as booking of air tickets, hotels, holiday packages, pick up services and insurance. Besides, they also advertise for other companies in their website.

AirGorilla also use fee-for-service revenue model by providing the similar services offered by Zuji and in addition, they offer some extra services like booking of restaurants and movies. However, there are no advertisements of other companies in AirGorilla’s website. Therefore, they are not likely to be adopting the Advertising-supported approach.

Similarly, QuestTravel practices the fee-for-service revenue model, except that they render fewer services. No instances of 2nd party advertisements are found while navigating QuestTravel’s website.

4.0 REVIEWS AND COMPARISONS

Our group had come out with 19 criteria to evaluate, review, and rate the three online travel agents we have selected. A table containing the decryptions/justifications of each criterion, as well as the rating of each travel agency is attached in the appendix section of this report. Below are the relevant reviews of each website on the criteria.

4.1 Product Diversity
AirGorilla not only provide consumers with the ease of booking air tickets online, but also offers a diversified range of services. They have integrated search functions which consumers can use to source and make online reservations for accommodations in hotels and youth hostels located in the consumers’ desired destinations. The transportation concern of consumers is also taken into consideration. Consumers can make pre-arrangements for the rental of vehicles for traveling from point to point, as well as booking of pick up services from the airport, and even coach services. In order to be an all-rounded traveling agent, AirGorilla renders online booking for cruises to various destinations.
Apart from the above, the website offers alternatives for consumers who do not wish to go on “free-and-easy” traveling. These alternatives include city tours, vacation packages, and holiday resort packages, which are readily available for booking, through the search function and links in the website.

Zuji provides an extensive range of services which cater customers’ needs when making travel decisions. Having many global partners, Zuji allows customers to enjoy one stop service, satisfying all their travel necessities such as online booking of air tickets. Hotels information, rental of car services, attractive deals, popular activities and even insurance coverage. A well integrated search function for online air tickets booking is available and customers can make use of the hotels and car services information to search for the best priced in accordance to their destination. In order to cater to people who are busy in planning their own travel trips, specially designed packages are available at attractive prices. Customers can choose the specific package and enjoy their trips without spending time doing their own research on accommodations and activities in their preferred destination. Zuji even provide travel tools such as currency converter, weather check, embassy information and visa requirements to further facilitate customers. Zuji also scan and tracks the lowest return airfares for up to five chosen destinations and alerts the customers via e-mail when a better deal is available.

Quest travel offers online booking of air tickets and hotels bookings for customers to pre-book their hotels at the designated locations before they even start to travel. There is a flight search function but it requires customers to key in the locations manually as it does not have a dropdown box listing all the available airports. There are also some best package deals in selected destinations across the whole world listed in the holiday section of the website. Customers can click on their preferred destination and check out the promoted package deals. Destination guides are also provided for the customers for them to find out more about their destination, their climate and the currency.

4.2 Product Availability
Unlike other online traveling agents who only serve specific geographical location, the services provided by AirGorilla are available to the international consumers worldwide. For instance, customer can choose its preferred location of departure without limiting himself for boarding of flights at specific location dictated by the agent (e.g for boarding in U.S only). Consumers can have access to the booking of hotels and transportation services in any part of the world, which can be done instantaneously. Our group had made a significant number of searches using the website, and the services we requested are always readily available for booking, regardless of any search criteria we entered (E.g number of persons, date of departure and return, locations, airlines).

Zuji allows customers to book and board the plane from anywhere in the world. This is to ensure that Zuji caters to all international customers. Booking of hotels and car rental are also available in all parts of the world. Using the same method of analysis done on Air Gorilla, our group had made a significant number of searches using the website, and the services we requested for are always readily available for booking, regardless of search criteria we entered.

Quest travel allows customers to board their planes from most parts of the world. This is specially targeted at Quest travel’s international customers. Using the same method of analysis done on Air Gorilla, our group had made a significant number of searches using the website, and the services we requested for are always readily available for booking, regardless of the search criteria entered.

4.3 Pricing
The search function of the AirGorilla’s website automatically returns result with the cheapest airfare, at the top of list. The airfares displayed in the search results are inclusive of service fees and are priced relatively low, compared to other agents. The current fees which are built into the initial fare include passenger fee ($18.93 per pax) that covers technology licensing fees and surcharges, as well as an additional a booking fee ($19.00) per booking regardless of the number of persons travelling.
However, tax information, which is separate, is only calculated after consumers click to proceed to the next step in the booking process. Taxes are highly variable depending on which cities the consumers fly through. For international flights, they can approach $100-$200 per passenger, due to fuel taxes, airport taxes, and government taxes. All the airfares are priced in U.S. dollars.

The returns for the flight search in Zuji’s site can be sorted in accordance to price, with the lowest air fare at the very top of the list. Prices offered to the customers are only the base fare and are subjected to additional charges including but not limited to government taxes and airport facilities charges. For some of the fares quoted, there will be an additional service fee per person, which is reflected under the base fare. The final price will only be displayed when the preferred flight options are selected and these prices are not guaranteed until full payment is received and ticket(s) are issued. Even after adding those service fees, surcharge and taxes, subtotal for the fare offered by Zuji is generally about the same, or lower than that of many agents.

The prices reflected by the flight search of Quest Travel offer consumers with 20 best fares with the lowest at top of the list. Prices offered by Quest Travel are inclusive of airline taxes and booking fee. As Quest Travel mainly targets at customers in the United Kingdom region (which has a high currency rate), the prices offered by them are much higher. Alternatively, users can request for a price quotation for their specific destination and Quest Travel staffs will attempt to reply within 48hours. Quest Travel believes in pricing their products at higher price than their competitors for the better quality services they are offering to consumers.

4.4 Dynamic Pricing
The only form of dynamic pricing which AirGorilla offers currently is group pricing. It requires a minimum of 10 passengers in the group. Interested parties can fill in an online enquiry form in the website, and request for a quotation from several airlines such as, America West Airlines, American Airlines, Continental Airlines, Northwest Airlines, Southwest Airlines and United Airlines. The quotation will then be made known by means of electronic mail.

Zuji does not offer any form of dynamic pricing. However, it does have a function, known as “Price Guru” which helps registered users monitor airfares of up to five preferred locations, and subsequently notify them via E-mail.

QuestTravel offers dynamic pricing whereby user can request for a quotation by filling an online quotation form, specifying their budget, destination, traveling preference, passengers’ details and accommodation requirements. The quotation will be received within 48 hours upon the request. Alternatively, there is also a phone number provided in the website by which consumers can request for quotation.

4.5 Branding
AirGorilla works with many other air consolidators with published air fares of hundreds of airlines to give customers the lowest air fare, which differs them from heavily advertised travel sites without low "consolidator" fares as they find it to be too complicated. With sure differentiation, customers will be able to the lowest air fare available which fits their desire destination. AirGorilla creates an impression to their customers that the air fares the give are the lowest available due to that they are an exception in the market and they are a very much trusted internet travel.

Zuji specialize themselves in catering their services to the customers from the Asia-Pacific’s region. Zuji therefore created many regional sites with specific language selections to target at those customers. With such sites, customers from the Asian-Pacific’s region who are not familiar with the general language will have no difficulty in making an online purchase with Zuji. Zuji work hand in hand with many global partners which gain them access to over 400 airlines, 60,000 hotels, 50 car hire companies plus 3,000 activities and attractions. With such global partnership, Zuji make use of the integration of several web applications to give customers the convenience of purchasing from them. Zuji key target is to put the world of travel at their customers’ fingertips and spoilt them with varieties of choices. Zuji also gives customers a perception that they are a familiar and trusted online one-stop travel agency.

Quest Travel differentiates themselves with excellent services and expert advice they offer to their customers. They are able give customers the assurance that their services they will give customers full assistance as they aim at treating and serving every customer as individuals. They offer a wide variety of products and services to customers such as flights booking, holiday packages, hotel bookings etc. Their varieties of products provide customer a choice to customize to their own needs. Quest travel works towards giving customers a perceived value that they are very reliable and trustable in terms of service and that their wide range of products are sure to leave customers with the best choices to choose from.

4.6 Uniform Resource Locator (URL)
The URL - http://www.airgorilla.com is identical to the company’s name and therefore can be easily recall and remember by consumers upon thinking the company’s name.

Zuji registered their URL http://www.zuji.com in a way where they uses their company name Zuji as the main domain name. They also create regional sites for consumers in different countries, where by different promotions and prices are customized according to the general preference of the specific country they are in. Users can directly enter their country code such as “.hk” as the sub-domain, for a Zuji’s website that specially caters to Hong Kong’s users. Alternatively, users’ can also navigate to the regional site from Zuji’s main site.

The company’s name is used as the main keyword in part of their URL - http://www.questtravel.com, making it simpler and easier for people to recall and remember their address.

4.7 Search Engine Results
*All searches were done in www.google.com and www.yahoo.com
The term “Air Tickets” was used to search for any results related to AirGorilla. It appears that it is in the 2nd page of the search results which shows they might have paid placement for Google and Yahoo to put them high up as an agent to sell air tickets. However they are not in the top 50 search results under the term “travel agency”. Both searches in yahoo and google return very much identical results.

*All searches were done in www.google.com and www.yahoo.com
When searching for the term “Air Tickets” in goggle. The return for Zuji appears on the first page and is 3rd on the list. This implies that Zuji may have paid an amount to Google so that they are “visibly” listed in the search results when consumers search for products related to “Air Tickets”. However, when the term “travel agency” is used, Zuji is not listed under the top 50 results. In the case of searching in yahoo, Zuji did not appear in the top 50 results. This clearly shows that Zuji is placing more emphasis on the surfers in Google.

*All searches were done in www.google.com and www.yahoo.com
In two separate attempts on using both Google and yahoo to search for the term “Air Tickets” and “travel agency”, Quest Travel is not listed in the top 50 of the search results. Therefore, we see little effort from Quest Travel in gaining publicity on the search engine.

4.8 Frequency of Updating
It is stated at the top right hand corner of the page on airfare that the website’s airfare data base is updated continuously. However, the frequency of updating and the date which AirGorilla last updated their website were not mentioned.

From the website, it is not clearly stated how frequently Zuji website is updated neither do they state the date they last update their site. However, from the promotions packages offered by Zuji, none of the packages has actually expired. From this observation, we can see that their website is frequently updated to ensure information given to consumers is accurate.

From their site, we can see that there are many recent promotion packages offer; therefore we are able to tell that Quest Travel updates their website frequently for users to know their latest promotions. They also have a price quotation section where they respond to their customers’ request within 48hours. This tells us that they take pride in making sure information given to their customers is updated. Therefore, we can conclude that their website a generally frequently updated.

4.9 Advertisements/Pop-Ups
AirGorilla is secured in the sense that there were no pop-ups upon entering the site. Potential customers viewing the site might question the security of online-payment if there is too many pop-ups. It also does not have many advisements, which might divert customer’s attention away due to their interest in the particular service or product that is being advertised.

Upon navigating the entire Zuji website, there was no presence of Pop-Ups, giving viewers an excellent surfing experience. Advertisements of other companies were placed in a separate section called “marketplace”. In that section, banners and pictures of the products belonging to the advertising company were systematically organized and categorized. Other then the above mentioned section, 2nd-party advertisement banners were placed on the top right hand side of the website (E.g. Visa, HSBC Bank). Besides that, Zuji posts many of its own attractive and eye-catching banners to promote latest travel packages and offers.

QuestTravel does not have any pop-ups in their site and there were no 2nd party advertisements. There are plentiful of banners displaying their promotions each of them has QuestTravel’s contact number listed along with it.

4.10 User Friendliness
AirGorilla’s website has a very well organized format, allowing users to navigate the web with certain main buttons. But along the way, some of the functions cannot be located easily and can only go through certain route to access. For example, if a user wishes to get their contact number directly, the user will need to go through a series of questions before he can obtain the number. This creates certain form of hassle for the user.

Obtaining information from Zuji’s website is rather easy due to the fact that it has a couple of independent search mechanism dedicated to the respective service it provides. Information described in the website is useful and detailed. However, the presence of too many hyperlinks in the website tends to confuse the users.

QuestTravel’s website has a very neat layout and navigation is generally straightforward and direct, such that even novice users would be able to handle. However, the information listed in the website is limited. There are insufficient resources provided to the users, which in turn, creates doubt for them. All enquires and additional information has to be obtained through phone, which would be troublesome and even costly for International consumers.

4.11 Layout Attractiveness
Colors used in the website are blending and are easy on the eyes. Wordings and fonts are easily comprehensible. Company banner and promotion banners are nicely aligned prominently placed and are able to attract the attention of viewers. Pictures and graphics were used appropriately without causing the entire site to look messy. The website is easy to navigate, no broken links were found and a sitemap is incorporated. Generally, the website provides a very clean and neat outlook.

The colors used in all pages of Zuji’s website are uniform. The frames are in tones of blue, background in white and majority of the wordings in black. This provides a great contrast against the colorful banners and pictures used, allowing these graphics to capture the attention of viewers. However, the presence of too many of these colorful and animated graphics also makes the page look rather complicated. Zuji provides different language interface for different geographical locations. For example, if a viewer makes a selection to visit the Taiwan site of Zuji (www.zuji.com.tw), the wordings will be displayed in Chinese instead of English. At such, it is more convenient for viewers who are more proficient in their own national language. The website would remember the preference of each viewer, and would load the preferred settings and interface during subsequent visits. There were no broken links found in Zuji, and a sitemap is also present.

The website of Quest Travel uses a very simple layout with a uniform theme comprising of two basic colors, purple and orange. Banners and graphics are used extensively in the website such that they made up the majority of the content in every page. Little information is put in words. Instead of animated graphics, the use of still image makes the website looks simple and tidy. However, there is a redundancy of the repeated display of their contact number below each banner. The continuous prompting of the users to call them up, gives the impression that the information in the website is limited or out of date. Similarly, there are no broken links and there is an availability of a sitemap.

4.12 Quality Statement
AirGorilla’s philosophy believes in reducing their overheads by not investing their capital on other investment since they started the business. All the legwork and negotiation are carried out by AirGorilla themselves. Therefore they are able to pass on their savings to their customers. They combine the discounted fares from multiple participating air consolidators with the published fares of hundreds of airlines to provide their customers with the best selection of low fares. They also believe in giving their best service in order to achieve trust between the consumers and them.

Zuji believes in providing most extensive information for customers, aims to be Asia-Pacific’s most comprehensive online travel company and puts the world of travel at customers’ fingertips. They have further proven it by offering customers an option to pre-book hotels and car rental services even before customers begin their travels. With the flights and price guru system, they ensure that customers have the best deal in terms of flights pricing and flights selection. Zuji also informs customers if there is a better deal available through emails to their customers. A privacy and security policy can be found in the website in order to assure customers of their quality.

Quest travel believes that their staff plays a major part in maintaining high quality service. As a result, in-depth training and ongoing product education are provided for their consultants to supplement their personal knowledge and experience. Their staffs are encouraged to travel extensively to ensure that they collectively have first hand knowledge of their destinations. After browsing through the list of Quest’s team, we came across Mr Steve Robson who is their quality control supervisor which further proves Quest travel commitment to quality. By allowing customers to pre-book hotels in their website, they allow customers to have additional options and information before going for travel trips. A privacy policy and terms & users conditions can also be found in the website in order to assure customers of their quality.

4.13 Site Help
AirGorilla provides user with ample amount of guidance in surfing their web. For example, when a visitor has any enquiry, their help desk section compromising of an Advanced Customer Service System is able to help. It includes a series of answers for your questions. If the information given is still insufficient, they will direct you to email or to their direct line specific to your query. We tried sending email to them and their response to our emails is usually within 1 working day.

Zuji has a help section providing plenty of information on Frequently Asked Questions (FAQ). Information is classified into respective categories such as flights, cars, hotel, general etc. This enables the users of the website to swiftly obtain the relevant information they required. There is another customer care section, whereby registered users can fill up an online form to enquire about any ZUJI-related travel activity. Zuji also publish their helpdesk phone and fax numbers for easy reference by the users. Our group was impressed by their speedy customer service when we tried to email Zuji for inquiries, and received a respond from them within a few hours.

The Site help of QuestTravel comes in the form of an FAQ section. However, there were only 10 questions and the answers to most of the questions are rather brief.
They simply provide phone numbers for users to call up for further enquires. Additionally, they did not list E-mail address where users can actually contact them if in doubt.

4.14 Search Function
Generally, the search function on AirGorilla’s web only allows users to search for air flight availability and the cost of the flight. The site has a series of different search options for user to choose from (e.g. airline, time, cabin etc.). This facilitates users to specify the search criteria and therefore, the search result will be more refined. The time taken to complete a search is very short and the results are arranged with the cheapest fare at the top of the list. We did a number of tests on their search functions and found that the results are accurate and relevant.

Zuji has integrated search mechanisms within the website that allows users to search for flights, hotels, cars, and insurance according to their preference. Users can specify their criteria of their search through a series options and following that, a list of choices will be displayed. Time taken to complete a single search is relatively short and users can sort the search results according to price, dates (for flights), ratings (for hotels) etc. Results displayed are accurate, well-organized and easily comprehensible.

QuestTravel does not have its own integrated search for flights. Their search engine is powered externally by their partner which is also an internet agency, known as “Opodo”. The search offered by Opodo allows filtering but the search can be relatively slow at times. The results returned are precise and sorting by duration, departure and arrival date, price and airline is possible. QuestTravel also provide search for hotels via its website. The search is a fairly simple one but the limitation is that users are not allowed to specify any other criteria besides the destination country. A list of hotels located in the country concerned will then be displayed together with some general information along with the prices involved. The checking of availability can only be made through phone calls.

4.15 Security
AirGorilla ensures that all transactions made through them are protected by a state-of-the-art secure socket layer that prevents theft from retrieving their customer’s credit card information. All transactions are validated and approved by the International Air Transport Association (IATA) which ensures they are reliable and secure.

All information sent to Zuji is encrypted, including credit card information. There is also a team to regularly verify the authenticity of the credit cards and ensure that it has not been used for making unauthorized purchases. Verification with the customer whenever a transaction is to be processed is necessary to ensure the card information is not misused. It may means extra work for its employees but this is the extent they will go for the sake of security.

All online transactions of QuestTravel are handled by Opodo which is accredited by IATA. According to Opodo, it uses SSL, or Secure Socket Layer technology to encrypt credit card details at the time of entry. Without the client’s permission, no details will be given to a third party.

4.16 Mode of Payment
AirGorilla only accepts online payments using credit cards or debit cards. However, it accepts most of the major cards such as Visa, Master and Amex. For payment to affiliated ticketing agencies, consumers are required to download a credit card authorization form, had it filled in and faxed to AirGorilla’s main office, together with the photocopy of the consumers’ passport and credit card.

Zuji accepts 3 types of payment methods --- online payment by credit card, by telephone, and the tradition method of making payment in person at the ticketing office. The 3 major types of credit cards are accepted, they are Visa, MasterCard and American Express. As there are people who do not trust the creditability of the company as well as E-payments, allowing payments via phone or in person, provides customers with a kind of security which payment online will not. Vouchers such as E-voucher and Z-miles are also accepted as part of the payments.

The online transactions and ticketing of QuestTravel are done by their partner Opodo, which only accept payments via Visa, MasterCard, American Express, Switch/Maestro and Delta.

4.17 Refund Policy
All tickets sold by AirGorilla are non-refundable, non-changeable, and non-cancelable. Fares are not guaranteed until tickets are issued, credit card successfully charged, and route validity double-checked. Unless otherwise stated, tickets cannot be changed and are non-refundable.

As Zuji is a agent instead of an airline, all cancellations of the air ticket are required to be done 2 hours in advanced otherwise a no-show penalty will be imposed. Therefore like other travel agencies, the policy of refunding depends very much on the respective companies themselves.

Quest travel outsourced all it’s booking and ticketing to Opodo. Hence refund policies are decided by Opodo. In Opodo’s refund policy, the refund depends very much on the airlines. As stated in the FAQ they cannot guarantee how much they will be refunding or whether can it be refunded in the first place. If refunding is possible, the money will then be credited back to the account where it was first deducted to make the purchase. For paper tickets, refund has to be made in person at the ticketing office.

4.18 Customer Reward
As we are unable to be part of AirGorilla’s customer database, we do not know what privileges that only the VIP or customers enjoy. No relevant information was promoted in the website. To be part of their customer database, we have to register with Air gorilla at their office, which is located in San Diego (California) area before we can access the website as a registered user.

Zuji has their very own membership programme, which allows registered users to view their bookings and manage their travel profile. It is free to register as a member of Zuji. Upon signing up as a member, travel preference such as preferred destinations and travel themes of the member are stored in databases so that members can receive customized special offers from Zuji. Members of Zuji are also entitled to subscribe to “Zuji Price Guru Service”. It is a free service that includes personalized subscription service that tracks the best round trip fares of consumer’s choice. Apart from these, Zuji does not have any loyalty point system in place which rewards customers.

After surfing Quest Travel site, we noticed there are no options for users to subscribe to any form of membership, nor did we notice the existence of any reward system. However, we do not eliminate the possibility that they have some form of customer reward that is in place for their existing customers. The website allows users to subscribe to their newsletters and advertisements by registering their Email address with Quest Travel.

4.19 Links/Affiliations
AirGorilla has links to restaurants, travel insurance, airport parking, applications to passports/visa, global cell phone services, rail tickets and movie tickets booking. However, these are just links to the relevant websites that can assist the travelers. It even has access to booking of car rental service overseas online.

At the bottom of the homepage, there are many links to the sites of Zuji’s international partners, providing easy access for customers who wish to have a look at the partners’ websites. Under Zuji’s Singapore affiliation program, Zuji is offering companies who refer their website users to Zuji. If any user makes a booking, Zuji will pay the affiliated company commissions every quarterly. The Zuji Singapore Affiliate Program allows companies to focus their efforts on selling travel, while Zuji itself handles transactions, handle ticketing, billing and provide customer service for the users. An affiliation application form can also be found in the same website for companies to fill up.

The links listed in QuestTravel’s website are found on the left border of the website’s homepage. They consist of travel tools that are available to customers such as currency converter, foreign office advice and worldwide weather. The search mechanism for flights found in QuestTravel’s site, is powered by Opodo.com.uk, which is their official partner/affiliate.

5.0 RECOMMENDATION OF E-COMMERCE PRACTICES

Any good E-Commerce site needs security. When security is provided for customers, it is actually telling them that “you are who you said that you are”. It's letting customers know that their business is important to the company, and most of the time online security will bring about more business. The basic form of online security is providing a Secure Socket Layer for eCommerce site. SSL is all about encryption. It encrypts data, like credit cards numbers (as well other personally identifiable information), which prevents the "bad guys" from stealing information for malicious intent. For instance, Zuji has its SSL certificate provided by VeriSign, a well established company dealing with intelligent infrastructure services. In addition, Zuji published their security policy in the website, which further strengthen the trust and confident of Zuji’s consumers.

Superb customer service coupled with some smart marketing techniques can make all the difference for E-Commerce customers. One of the best technique is to do follow ups. Do not let the sale be over when the product or service is delivered. Contact the customers to let them know they are still important even though the company had already earned their money. Other techniques would include sending promotional updates on other products that they may be interested in periodically, or providing personal assistance with customers’ purchase if needed. Zuji emphasize on its customer service by providing online feedback phone and setting up seven-days-a-week hotline to respond to customers’ enquiries.

It seems obvious that affiliate marketing can help company make money. However, affiliate marketing can also help your business in other ways. If customers see the fact that large companies are on your site, they might assume those large companies bought advertisement space there. For that reason, you gain respect from your visitors by merely listing the advertisements. For a company doing online air ticketing, placing affiliate ads for hotels and insurance gives value to the customers by saving them a trip elsewhere. Customers are going to leave the site one way or another, why not let them leave through a link that will earn money for the company and also give value to them. In the case for Zuji, it places advertisement banners of reputable companies such as VISA, and in addition, offers affiliation programs.

Domain name is not only important, it's vital to the success of online business. A poor or catchy domain will cause the site to be invisible in the search engines. Domain should be simple and say what it does. For example, from one look at the URL http://www.questravel.com, a normal sensible person would know that the site deals with travel businesses. If your domain name is too long, online business will suffer because no one will take the time to visit the site. A long domain name would mean something like http://www.OnlineAirTicketSale.com .

No matter how much passion and marketing goes into a website, a poorly designed website can kill traffic and ultimately the business itself. Creating the perfect site is an easy task, but if properly done, the E-Commerce site can soar above the rest. An E-Commerce site should look like a business and page design should have a clean outlook. It can be done by ensuring images and text on the site in the normal range of most websites, as well as avoiding excessive use of animated graphics or big flashing lights. All the 3 sites that we reviewed had successfully met these criteria.

Traditional ways of payments such as cheques mailing and remitting are not only time consuming, but also inconvenient. In order to really get sales, companies need to be able to accept E-payments. The catch is to have as many payment options as possible, giving more choices to customers and thus, facilitating their purchase. Companies can register Merchant accounts through banks, for processing credit cards. Alternatively, online processing companies like PayPal and 2CheckOut.com also provide non-contractual credit card processing. AirGorilla and Quest Travel accept credit card payments only. In contrast, Zuji also accept other form of payment such as E-voucher and E-miles.

The ability to change prices in the blink of an eye and instantly responding to market fluctuations, would be an attractive tactic to online retailers. Dynamic pricing enables a business to respond to a customer's request for quotes on the basis of supply-and-demand information. Such data will be useful when reconfiguring prices. Pricing for airline tickets can varies, depending on frequent flier usage, special promotions or travel site discounts. In fact, most of the passengers on any given airplane have paid different ticket prices for the same flight. QuestTravel offers dynamic pricing whereby user can request for a quotation by filling an online quotation form or through telephone calls.
Competition for premium placement on the Internet search engines has created an advertising market for paid search listings.However, E-commerce sites that consider advertising via paid search results should understand that not all search engines are effective and popular. The audience of search engines is usually made up of users actively seeking product and service information who often are ready to purchase. Thus, having the company’s website on a premium placement is porpular search engine would definitely help generate sales. Zuji is within the top 50 search returns in the search results list of famous search engine such as Google and Yahoo.
Customers are important assets of any E-business. A relationship with customer is ruined when a customer had to go through check out to discover that the item won't be available for the next three weeks. On the other hand, letting customers know that an item is "in-stock" and is “ready for purchase” is an attractive offer. The lack of product availability would lower a customer’s willingness to buy. As far as our research is concern, all the three travel agents had a wide range of product made readily available for their customers.
These are some of good E-commerce practices that would help a business to succeed and progress. Good practices take time to be discovered and implemented. There are many more good practices that should be incorporated into a business and are not just limited to those mentioned above.
6.0 CONCLUSION
6.1 Outlook of Online Agency

To predict the future trend of online travel agency, it is reasonable to analyze the main factors influencing the growth of online travel agency from air travel industry. From the view of the whole air travel industry, it is clear to see that an application of Internet benefit both airlines and online travel agency.

Airlines are now offering varying prices to customers in different market segments. As price change is the most basic marketing strategy used to compete, online reservation system allows both airlines and online travel agents to thoroughly exploit the Internet to acquire the best pricing strategy. With sophisticated information systems, it is now possible for airlines to offer complex discounts on bulk purchases across many different routes and classes of travel, for corporate customers. It is also possible for them to use advanced techniques to target dynamic discounts and value-added service offerings at high- value corporate customers, increasing the business that they attract through using direct sales channels.

Ordinary travel agents have faced additional threats to their profitability, caused by widespread use of the Internet. Compared with traditional travel agents, online travel agents have the advantage of much lower overhead costs. The lower costs can ensure the online travel agents can achieve much wider economies of scale in processing large numbers of relative low-margin purchase transactions. Online travel agents use new technologies to access the direct reservation systems of multiple services in real time, allowing individual and corporate customers to directly coordinate flight, car hire, hotel and other services.

There is also a cost to using online travel reservation system no matter which channel, airlines or online travel agents, the customers use. The time and effort involved in putting together a complex package of air and land travel services and hotel bookings is often too high for individual customers to contemplate as air ticket prices many change over time.

Customers actually benefit more than what costs them. The specialized technology required to make direct bookings is now available to the consumers, often at lower cost. Therefore, it is appropriate to conclude that online reservation system is the main stream of booking channel in the future. Both airlines direct reservation system and online travel agents have this advantage to survive and capture substantial returns.

Focusing on the air travel industry, it is not hard to discover that the competitive relationship between airlines direct online reservation system and online travel agent. In another word, even if the online travel agents have an advantage position compared with traditional travel agents, they have to face the challenges from airlines as well in the future, particular when catering to frequent flier consumers. This may cause tension between the preference and price structures allocated to indirect sales (travel agents) and direct sales channels (Airlines online reservation system), as there is obviously more profit in disintermediation. In recent times, there has been a trend of airline mergers, which effectively combine multiple travel routes and result in less competition on any particular route. Airlines have significantly increased their direct sales. Effective customer relationship management systems may now permit airlines to lock customers into using their airlines, through frequent flier programs, an element that has been missing in the industry until now, since most frequent fliers belong to several airline schemes.

Overall, it seems that a significantly substantial growth of online travel agency is seen. On average, more than 50% of travel agents' revenues accrue from air travel bookings. Hence, direct and online sales of air tickets represent a huge threat to the survival of most traditional travel agents. Even though the online travel agents have this prevailing advantage over the traditional ones, they have to face the challenges offered by airlines. The outcome is not such optimistic in long run because airlines are able to obtain higher profit by direct online reservation systems. Recent evidences show that airlines are attempting to increase their direct sales. Basically, online travel agents are less competitive compared to airlines because of the lack of financial ability and social influence. Therefore, in near future, as airlines are competing against each other and trying to maximize their own market share, airlines will still distribute through travel agents. In long run, as airlines have sufficient time to set up online reservation systems and training stuffs, airlines will gradually be independent from travel agents and earn a higher profit through direct sales channels.

6.2 Impact of E-Commerce On Traditional Travel Industry

The advent of online reservation systems has changed the balance of power between traditional travel agents and the airlines. The resulting shift has resulted in diversification by travel agents and other players in the air travel industry. Diversified travel agencies are now into selling multiple products, all of which can be reserved in real time. Online travel agencies are taking over from traditional travel agencies. They have the advantage of being able to access multiple real-time reservation systems, to offer group products and to provide preferential pricing through strategic alliances with various online reservation system firms. Example: One can now reserve and pay for a flight to Paris (comparing schedules and prices), book an ongoing rail ticket to Toulouse, select a hotel on the basis of exterior and interior views and customer reviews, negotiate over the price of a room and the size of the bed, all without leaving one’s desk. The convenience and availability of information makes the traditional travel agent redundant. They are still struggling with text-base direct reservation systems, directories of hotels and the problems of making multiple telephone calls to Europe. The only way in which travel agencies can compete is by focusing on the ever-decreasing proportion of consumers who are not computer-literate or who would rather pay someone to make reservations for them

When air travel first becomes affordable for the individual, travel agents provided an essential service. A travel agent would find a suitable flight in the printed schedule published by individual airlines and telephone the airline booking agent to make a reservation. At a later time, the booking agent would return the call to confirm the reservation or suggest an alternative flight if no seats were available. The airline would then pay the agent a flat fee of commission fee for the booking. Travel agents mainly serve the individual travel market while corporate travels were booked directly with the airline to achieve corporate discount. The role of travel agents was to advise clients on travel destinations and to act as an intermediary in the complicated process in arranging travel booking.

When E-commerce was introduced, the airline industry was deregulated, leading to more price and services competition between airlines on the same route. This change the way in which travel agents completed a travel transaction, and gave them faster and better information about price and availability compared with the previous booking directly with the airlines. The travel market become segmented as travel agents increasingly target corporate customers providing value added services like negotiation of bulk fare and arranging complex itineraries.

More recently, travel agents have faced additional treats to profitability, enabled by the widespread use of internet. The first is disintermediation by the airlines and the computer reservation system operators. With sophisticated information system, it is now possible for airlines to offer complex discount on bulk offers across many different routes and classes of travel for corporate customers. It is also possible for them to use data mining techniques to target dynamic discount and value added services.

6.2.1 Advantages of E-commerce in Travel Industry

With electronic markets emerging on the Internet, the travel agency has been characterized as the most endangered organization in the travel industry as potential travelers now have the opportunity to bypass intermediaries in the distribution chain. Customers are offered good opportunities for convenient and inexpensive travel bookings on the Internet. The expected advantages of e-commerce strategy include decreasing costs, expanding marketplaces, enhancing competitiveness, improving business image, and increasing revenues.

Timeliness is another major advantage. Customer can get any necessary information at any point of time as long they have internet access. The speed of getting the information required in also much faster compare to the fast. All filtering of choices and the best deal are also carried out with the help of search engine.


6.2.2 Disadvantages of E-commerce in Travel Industry

Companies can only target consumers who are computer illiterate, therefore those consumer who are lacking in knowledge of computers are often neglected.

Consumers' trust in online vendors has been extensively discussed in the electronic commerce research area. The discussion has focused mainly on the security of transactions, privacy of the customers' personal information and general trust in the vendor of whom the customer has not any prior experience. Many consider the lack of trust to be the main reason for the consumers’ slow acceptance of online commerce
Trust can be thought of as a strategy to reduce complexity in uncertain situations increasing the perceived certainty concerning the vendor's possible behaviour, such as security of payments and privacy of customer’s personal. Customer trusts that the vendor will not behave opportunistically to exploit consumers.

The system-dependent uncertainty is another issue in the e-commerce context. It could be caused by technological problems or unclear or non-existent legal norms. If the company can assured the customers that their personal information would not be used in any unauthorized way, the system-dependent uncertainty issues were not essential.

Another issue is the lack of media. The richest media in this case is travel agency and ticketing agency are the richest media customers may choose, followed by telephone. The interactive online booking system cannot convey or interpret multiple cues, it is not very personal and language used is not very natural, but however, feedbacks from the system can be very speedy.

6.3 Executive Summary

In the process of doing the report, we have researched the Internet for information on our given topic, E-commerce. Selling online is an everyday thing for all material goods, but what about services? Therefore we analyze into this area and establish our findings on travel agencies that provide booking of tickets online.

For business to survive, they have to offer new and greater varieties of products, most preferably related to the core business they are in. Looking through the initial 15 websites that our group short-listed, we found that majority of them provide other services such as hotel booking, car rental, travel insurance etc. All the extra links and services provided are all part of what a traveler needs. This means extra business for the agency, which also means higher profits can be achieved. Also, the Internet can save expensive overseas phone bills, which is a thing which cannot be avoid if e-commerce is not introduced. Savings on cost means extra profits as well.

Since every agency offers almost the same services, the one that has the competitive edge over its competitors is the one that offers the best deals and is best in almost every aspect.

In the case of Zuji, by providing different websites to cater to the different national customers thereby making it looks more international. With the click of a button, a business deal can be done half the globe away, which is the biggest advantage that businesses enjoy which the Internet provides. The right connections with people and companies are also needed to make a business international, and Zuji has the right connections.

By providing its customers with airline tickets from all over the world is the kind of competitive edge that a company needs, which is the main reason why Zuji is rated by us as the best among the 3. In terms of pricing, customer rewards, user friendliness and others factors, it has the competitive advantage over its competitors.

Traditional businesses can make use of E-commerce to extend their market, but it still boils down to the main business’s core principles, connections and refreshing business ideas. For consumers like ourselves, E-Commerce has certainly improved our shopping experience, and also the tendency for us to spend has very much increased from the time when E-commerce was not yet introduced.

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