CheapOair is the OTA that is not an OTA.
In fact, it prefers not to be called an online travel agency at all. It prefers to be referred to as a “multichannel travel company.”
That might not exactly trip off the tongue, but the company makes a good case for what makes it different from Expedia, Priceline, Travelocitiy and Orbitz: a tight product focus and customer communication.
Unlike most OTAs, which use air to attract consumers and hope they’ll also book a higher-margin hotel room once at the site, CheapOair sells exactly what its name says: air. While it does offer other travel-related products, including hotels, car rentals and travel insurance, air makes up the majority of its bookings.
And communication is a major part of its platform. Its phone number is on every page. Customers can chat online with staff in what CheapOair calls its contact centers. And, increasingly, more and more consumers are using the CheapOair app or its mobile site to connect with agents, according to Werner Kunz, CheapOair’s COO.
“Even in a highly developed online world, customers still want to communicate with service providers in real time,” Werner said. And that is particularly true when they’re booking international travel.
Werner said CheapOair makes money selling air because it works closely with airlines to sell their ancillary services. It was the first OTA to sell US Airways’ Choice seats in the booking path, which it introduced in April. Last month it began selling American Airlines’ bundled fares and Preferred seats in the booking path.
Werner said CheapOair helps airlines sell tactically. That is, they might have some seats to sell at a lower fare that is available only within a tight booking and travel window. Airlines don’t want to undercut their published fares with these limited discount seats, and CheapOair gets enough queries (it can issue up to 25,000 tickets on a busy day) to help fill these seats.
Its call center personnel can help bargain hunters find less expensive fares by suggesting itineraries with a layover.
CheapOair makes money in a variety of ways: commissions, back-end overrides and some markups.
“It’s a very multi-layered revenue stream that is finely tuned and optimized,” Kunz said.
CheapOair is part of Fareportal, a technology company that got its start by providing online booking technology to the retail travel trade in the early 2000s.
“At that stage, we were heavily dependent on those travel agencies to market online to their constituencies,” Kunz said. “It was a sort of slow growth, and we thought, ‘Why don’t we try it ourselves?’”
CheapOair did a soft launch in 2005 and officially launched in January 2006.
“It took off from there,” Kunz said.
Today, it does SEO marketing and email marketing. Its customers can opt in to emails that will send notifications of special targeted deals based on location, preferences and past travel bookings.
“The Internet has really become the Yellow Pages,” Kunz said. “Before, you would go to a newspaper. Now, instead of looking at a newspaper, you go onto the Internet.”
Fareportal’s brands, which include CheapOair, CheapOair.ca, CheapOair.co.uk, CheapOstay (a hotel vertical) and OneTravel, sold $2.7 billion worth of travel in 2012.
Employees work from offices in New York, Las Vegas, New Delhi, Toronto, Vancouver, Montreal and London.
CheapOair.com has also recently introduced Spanish and French Canadian versions of the site that enable users to change languages during their search without losing any data or having to start the process over.