Is the Travel Industry Headed Toward Another Wallop? | PhoCusWright FYI

Hospitality Net - Industry News - Is the Travel Industry Headed Toward Another Wallop? | PhoCusWright FYI: "With the global credit markets in crisis, stock markets fluctuating, fuel prices erratic and a recession looming, the travel industry is gloomy. Companies quickly shifted into belt-tightening gear and if they're not feeling the pinch now—they're at least preparing for a long, cold winter ahead...

"Will the 2008 economic meltdown be as bad for our industry as September 11, 2001?"

The answers to this question, of course, vary. Certainly, there are key differences between the two events. The terror attacks were a direct assault on the U.S. and aviation industry. The economy was already suffering from the tech stock bubble burst of 2000. Then the September 11, 2001 events virtually froze the travel industry for weeks—if not months—before the eventual thaw. Yet while cutbacks prevailed and some travel companies fell, online travel companies reported surprisingly bright results. . .

Perhaps the brightest hope for online marketers is that travelers, like in 2002, will flock online in search of lower prices, keeping OTAs, metasearch sites, and even online direct channels humming. After all, as one attendee noted, "the white table cloth dining industry has fallen off a cliff along with the $20 bottle of wine. On the flip side, cheap supermarket wine is experiencing a boom." So maybe it will once again be chic for online travel to be cheap.

Whatever happens, one remembers Barry Diller's infamous words at The PhoCusWright Executive Conference in 2002, when asked why IAC paid over US$1 billion for a majority stake in Expedia just months after September 11, 2001. "You know, if there's no travel, there's no life," he emphatically declared.

Let's hope that's what travelers say in 2009."

Totaltravel survived 2001 so lets hope it grows stronger again this time round.