SideStep, attempting to evolve beyond its
transaction focus, today acquired TravelPost.com,
which specializes in user-generated hotel reviews, ratings, photos
and blogs.
Rob Solomon, the
president and CEO of travel search-engine SideStep, said the
acquisition of TravelPost will enable SideStep to increase its base
of unique visitors and attract them early in the trip-planning
process instead of later when they are closer to the buying
decision.
The purchase of
TravelPost, which already had been providing user reviews to
SideStep, makes TravelPost a wholly-owned subsidiary of SideStep,
and will "create better economics" for SideStep, Solomon said.
Officials declined to detail the financial terms of the
acquisition.
SideStep generates
revenue as a marketer and lead-generator for travel suppliers and
doesn't process any transactions on its Web sites in the U.S. and
Europe or through its downloadable toolbar. Instead, SideStep
transfers users to supplier sites and generates revenue from
advertisers by charging them on the basis of a CPM
(cost-per-thousand-page impressions), a CPC (cost-per-click), and a
cost-per-booking.
Solomon said the
acquisition of San Mateo, Calif.-headquartered TravelPost probably
will be "more beneficial" to SideStep's cost-per-booking revenue
stream than to the CPM and CPC models.
Solomon said the
merger means SideStep will more aggressively "motivate and
incentivize" Web site visitors to review hotel properties, and the
travel search engine will integrate this traveler content more
tightly into SideStep's offerings.
Solomon said
SideStep, located about 25 miles from TravelPost in Santa Clara,
Calif., will continue to operate TravelPost.com as a subsidiary,
with TravelPost's employees transferring to Santa Clara.
TravelPost.com will continue to operate its Web site, and its
facility will remain open as a satellite office, officials
said.
Sam Shank, the CEO
of TravelPost, will become vice president and general manager of
TravelPost.
TripAdvisor, owned
by Expedia Inc., is widely acknowledged to be the leading
user-generated content site in the travel industry. TravelPost,
with its 250,000 hotel reviews and photos, claims to be "the
largest independently-owned site for hotel reviews and ratings,"
the company said.
Shank said the
merger means TravelPost.com's user base will be bolstered by
SideStep's customer base, and that blending TravelPost's content
with SideStep's transaction-oriented pricing and availability
information will be a valuable service to consumers.
Obtaining
user-generated content, including having hotel guests write reviews
and rate properties they have stayed at, has become a key priority
for a broad array of travel companies. They believe that enticing
users to become more engaged in Web sites, and enabling them to
communicate among themselves and establish an online community,
enhances the credibility of online travel companies and drives more
traffic and revenue.
Some social
networking sites require reviewers and bloggers to identify
themselves because the Web sites want to maintain their credibility
to ensure that a hotel employee or public relations firm isn't
surreptitiously penning a glowing review.
TravelPost requires
users to register to write a review, and identifies them by screen
name and through demographic information. For example, "Kellyanne,"
a 42-year-old leisure traveler on an "economy budget," advised
consumers in July to "stay away" from the Blake Hotel in Charlotte,
N.C. Kellyanne was miffed at the quality of the room's bed and
other amenities.
SideStep will have
to balance empowering consumers to write such "unbiased,"
sometimes-scathing reviews with the travel search engine's role as
a marketer for suppliers.
Asked how SideStep
will do this, Solomon noted that it is the responsibility of
suppliers to maintain high levels of customer service, reducing the
chance for a negative review.
To
contact reporter Dennis Schaal, send e-mail to [email protected].