Consumer Trends 2013: Strong growth for review websites

By Danny King
2013 Consumer TrendsDespite widespread suspicions on the part of travel professionals that user review websites such as TripAdvisor and Yelp are peppered with fakery and fiction, such sites are growing in popularity and influence among consumers.

Among respondents to the 2013 Travel Weekly Consumer Trends Survey, conducted by Warren Weiss Co. in June, 58% said they routinely seek out opinions of other travelers via travel review sites. That number is up from about 50% a year ago. (Read more from the Consumer Trends report here.) 

At the same time, 97% of those who consult such sites said that they had been swayed by user reviews to some degree in their choice of travel products.

The upshot is that consumer review sites are clearly playing an ever-more-significant role in travel decisions.

Users of travel review sites were just as likely to have used a travel agent during the past year as those who ignored travel review sites; both percentages came in at about 22%.

But the two groups differ in other ways. Users of review sites, for example, tend both to earn more and to spend more on travel.

But the biggest differences in the perceived credibility of such sites lay in the type of product being reviewed.

The Travel Weekly survey revealed that reviews had a far greater influence on hotel bookings than they had on choices of airlines, cruises and car rentals. And within the hospitality category, travelers were more likely to factor in others' opinions when booking non-resort hotels than resort hotels or all-inclusive resorts.

Either way, the changes in the poll's results during the past year indicate a combination of more people turning to the Internet and a greater percentage coming to see travel reviews as legitimate opinions when it comes to the approximately $120 billion spent each year in the U.S. on hotel bookings.

TripAdvisor, the world's largest travel review site, claims more than 200 million unique monthly visitors, about quadruple the site's traffic just two years ago. Meanwhile, Yelp in May reported 39 million unique monthly visitors, up from 32.4 million a year earlier, according to research firm ComScore.

Henry Harteveldt, travel industry analyst at Hudson Crossing, called the year-over-year increase in travel review use "impressive." The survey, he said, "illustrates that the consumer values 'real world' insights and perspectives. This also illustrates how it's increasingly easy for travelers to put their trust in other people, rather than in a credible, trained travel professional."

The issue is key for the hotel industry because of the relatively high impact reviews have on bookings. Of those travel review users in the poll, 72% said reviews had at least some influence on a booking at a nonresort hotel, while 58% of resort bookers were influenced.

By comparison, reviews had an effect on 21% of the airline bookings and just 14% of car rental bookings.

Such increased reliance has forced the hotel industry to take a more collaborative approach than it had in the past, when it was viewed as somewhat combative when it came to review sites' collective impact on room demand. Wyndham Hotels and Resorts last year started adding links to TripAdvisor reviews on its hotel websites.

Meanwhile, in 2011, Starwood Hotels & Resorts, the No. 2 publicly traded U.S. hotelier by sales after Marriott International, started taking matters into its own hands by adding its own user review section to its hotels' websites.

"The increase [in user-review adoption] is not a surprise at all," said Starwood spokeswoman Melissa Pogue. "Guests look at those reviews. And it's not just the review but the response from the hotel's management to reviews that help inform a guest's booking decision."

With this in mind, some analysts are starting to quantify what had previously been thought to be unquantifiable by estimating what kind of effect in real dollars a good or bad review has on a particular hotel.

In late 2012, Cornell's School of Hotel Administration said in a report that a one-point swing on Travelocity's five-point rating scale on average changed room rates by as much as 11%. The school also compiled an "online reputation score" by pulling user reviews from multiple sources and concluded that there was more than a one-to-one correlation between a hotel's reputation score and revenue per available room. That means that a 10 percentage point change in review grades may result in well over a 10% swing in the revenue a hotelier takes in per room.

The rise in the use of travel review sites is also dovetailing with increased activity on general-use social media sites in general, with more travelers having multiple accounts.

While the percentage of respondents in the Travel Weekly survey who had a Facebook account held steady from last year, at about 80%, the percentage of those using Twitter rose to 34%, from 28% a year ago, and the percentage of those using Instagram jumped to 23%, from 16%.

Harteveldt said,"Travelers consider travel-focused ratings and review sites such as IgoUgo and TripAdvisor as being much more helpful and effective for trip planning compared to general purpose social networks. That said, reading a post or seeing a photo taken by a bona fide friend on a social network like Facebook can have enormous impact on a person's trip-planning and purchase decisions."

That's not to say the user review process is foolproof or that some of the results on such sites can't be manipulated by travel suppliers looking to gain an edge. In a report released last September, the research firm Gartner estimated that by next year, as many as 15% of social media reviews of places like hotels and restaurants will be fake.

In fact, the industry recently took a bit of a black eye after an executive with Paris-based hotelier Accor was found to have posted more than 100 reviews of both Accor-operated hotels and competing properties on TripAdvisor under an assumed name. (Accor said the executive, who subsequently resigned from the company, violated the hotelier's social media policy.)

Still, such hiccups aren't likely to stop the perusal of user reviews from becoming an increasingly prominent part of travel bookings, especially for hotels.

"We have seen consistent strong demand for traveler reviews," said Douglas Quinby, principal analyst at travel research firm PhoCusWright. "They are among the most important among online travel website features for travelers."

Follow Danny King on Twitter @dktravelweekly

Read more from the Consumer Trends report here
This page is protected by Copyright laws. Do Not Copy. Purchase Reprint
blog comments powered by Disqus

View Comment Guidelines

Please upgrade your Flash Player.
Please upgrade your Flash Player.

Travel Weekly Poll


  • Consumer media discover that travel agents do exist

    "Contrary to some thoughts, travel agents do exist ... We are usually able to get clients better prices, and we know we can see that clients have better experiences. And as our personal motto is: Our Service Travels With You."


TW Index: Most Active Stocks

Latest Top News:
Travel Weekly is on Facebook
Viewpoints For Travel Agents
Travel Weekly Topics