By: David J. Wardell

© 1997 By: David J. Wardell.  Reproduction or redistribution in any form without written permission is strictly prohibited.

The "Internet Hysteria" phenomena, not just in travel circles, has been compared to a gold rush—most of the miners are starving while they look for gold while the saloons, brothers, and folks selling books on how to mine make money.

For starters, who exactly is the Internet customer and what are they buying? Despite what people tell you nobody really knows.

Most statistics seem to have been created to prove whatever point someone needs to prove, but according to A.C. Nielsen there are roughly 12 million people in the U.S. actually using The Internet from their PCs—mostly for e-mail. The vast majority use their accounts under 1 hour each week (which isn’t time enough for all the graphics on some web pages to load, let alone buy anything).

Most surveys hypothesize that "heavy users" of Internet services (the so-called "early adopters") are mid to upper-income males, of which there might be between 2 and 4 million nationally. This explains at least partially what people are believed to be buying on The Internet.

According a 1996 estimate of Internet commerce American consumers spend about $500 million annually in three main areas: computer products, travel, and "adult" entertainment.

Shouldn’t we be encouraged that travel ranks #2? Not really; we’re dealing with tiny numbers of customers, not a flood of potential new business.

Despite the pervasive nature of travel services on the WEB these days few Internet sellers deliver any real value, meaning something that readily available online and nowhere else. The "early adopters" may invest the time and energy necessary to extract some value from Internet-based travel sales, but the effort required are usually disproportionate to the reward; hardly a recipe for a sustainable, expanding business.

Can’t The Internet be used to advertise and "convey image?" That’s one of its main purposes today—mostly advertising for the computer industry. However, one study estimates Internet-based advertising profit at 1/10 of 1% of that realized nationally.

The Internet customer is far too anonymous (despite what people tell you) and the market far too limited for much meaningful advertising progress to take place now.

What exactly is the "image" that is being conveyed? Most Internet advertising is downright miserable, ineffective, and irritating. That’s not just my opinion: its been voiced frequently by experts in the field.

I once casually observed that travel advertising was not immune from this sorry picture and was promptly chastised as being "out of touch", as having a web site allows an airline, for example, (even though the site is filled with little more than pictures of airplanes and smiling people) to "establish its identity as an airline."

Huh? Usually one associates an airline’s identity with flying airplanes, not with pictures on a computer.

The Internet does have a place (an expanding one) as one tool among many that travel businesses can and should use, but it needs to be viewed in proper perspective and not assumed to be the electronic savior of all segments of the travel industry, which it clearly is not.

There’s important work to be done refining Internet-based travel products that do deliver value and integrate tightly into the way businesses and customers behave, ways to pay and account for those services, and ways to refine the advertising message before The Internet can bring anything approaching the benefits many people expect to travel.

Businesses commit a serious error if they ignore all potential distribution channels, including electronic ones, but its equally bad to confuse some of today’s "net-work" with the real work required to adapt a business to the challenges of the 90s.