Recently, I heard that a couple of gentlemen working in the Corporate Development side of Expedia with regards to their go-to-market plan for Japan. Apparently, as of 1.5 weeks ago, an agreement was in the final stages for Expedia to setup a partnership/alliance with JTB to resell their travel offerings as well as occupy office space in their Shinagawa (Tokyo) office.
Apparently, Expedia is very green in their plans to provide a go-to-market plan. First, the agreement appears to exclude a lot of national travel and focus mainly on International travel. Also, relationships with JAL and ANA tend to be undefined and leaning more towards not including the establishment of these relations with Expedia. If this is still the case with the agreement per 1.5 weeks ago, then why enter the market with limited options when national travel is a significant portion of the market? Second, Expedia has used Booze Allen as a consulting arm to help them justify and put into place an understanding of how they will enter the market. One of the concerns I heard coming from the corp dev folks is that Booze Allen was raising the concern that Japanese will not purchase over the Internet with a credit card and that it will be difficult to make the transition. This is entirely false and Dell Computer and Yodobashi Camera have shattered this misguided fact. My bigger concern for Expedia is how they plan on establishing a relationship with the consumer when the consumer has traditionally utilized a trusted agent relationship at a local branch store (which is everywhere!) for recommendations and the necessary legwork by these agents they have utilized for some time to find the right price, etc?
Second, Expedia just recently promoted Barney Frank as President of Asia/Pacific. Barney has no experience whatsoever in the Asian markets, which is a potential liability when it comes to understanding business culture and the way of doing things. As an example, those at Expedia were concerned with the fact that JTB were taking so long in the negotiation process and in getting answers back from them re: the partnership details. This is simply just a fact of doing business with the Japanese culture. If patience and respect aren�t applied and one becomes too pushy to receive an answer it will break the deal. In addition, there were some obvious language barriers between translators and Expedia. Those barriers showed themselves when JTB understood the agreement between Expedia and themselves was slightly different than what was thought. The misunderstanding was more of understanding in Japanese the tone and expression in the negotiations rather than taking the translation (chokuyaku) at face value, which is commonly done. If Barney is going to manage this relationship, he has a steep learning curve to ensure these issues don't crop up again.
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Very interesting commentary from hollandleo. As a long-standing IACI short, I appreciate the business insight and the effort taken by hollandleo to detail some of IACI's ongoing difficulties in expanding their business abroad. From my own experience living outside the US, I can attest as to the reality that the US consumer is much more likely to get swindled by appealing online offers, and due to that, much of IACI's has already taken place. Good luck to everyone.
So only the US consumers present opportunities for growth and sales?
Why is it then that IAC travel's international business is tripling its net revenues year over year?
Why is Expedia.co.uk England's #1 or #2 seller of travel, period, online or offline? Why is Expedia.fr able to partner with SNCF, the french national railway, for a full-service travel site, and sell millions of dollars in travel annually? Are the French and English being "swindled"? Is Expedia completely ignoring the needs of non-US customers?
First of all, the reason why people in Asia would buy online is the same reason people in the U.S. did - it is because the interface is more attractive i.e. i'd rather choose my own travel than have a lazy mid-50's fat woman trying to get incentives for free travel book it for me and, oh by the way, its cheaper. Secondly, Barney Frank is the homo in Congress, the only Barney at Expedia is Barney Harford and he has been successful at every endeavor that has ever been put in front of him at Expedia. I like your information, just try to be more accurate with it.
>> First of all, the reason why people in Asia would buy online is the same reason people in the U.S. did - it is because the interface is more attractive i.e. ...
Easy mister. Consumers in Japan that are willing to purchase online via CC comprise a FAR SMALLER segment than those in US or EU. Companies like Amazon, Rakuten, Tsutaya, ESBooks, etc. have created alternate payment methods to support the differences in Japanese buying behavior- such as CVS delivery, P.O. payments, COD, utility bill add-on, etc. I am thrilled IACI is looking at JP, because the online travel market there is so fragmented and it's a great opportunity, but they will need to solve some unique problems to make it grow big.
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Third, Expedia just recently started the hiring process with Russel Reynolds in Japan for a local hire. My main concern is not leveraging the potential experience this country manager can provide (both from fluency in the language to experience indealing with Japanese) in the JTB negotiation process as well as establishing the strategic groundwork and knowledge this individual might contribute to the go-to-market plan.
Lastly, I believe that Expedia is putting the cart before the horse on this initiative. Apparently, with the JTB agreement coming to a close shortly Expedia will not have a site up and running within 6-9 months of the agreement. A single project manager has recently been assigned to assess all of the necessary items that are required to building an e-commerceable site in Japanese. Unfortunately, neither this person nor the individuals involved in this project have extensive experience with double-byte technology and customer-facing/back-office implications that makes the customer experience glitch-free from launch. A project like this could take anywhere from 9 months w/o any glitches up to 18 months. I wonder if JTB realizes the length of time it will take Expedia to get something up and running and if that fits within their expectations? If Expedia prolongs the time between the agreements signed with JTB and the time it takes to get a site up and running without setting JTB's expectations on a "go-to-market" date.
For those of us in the middle, your exaggerations and now flat out lies do not help build the short case. Where Jeff lays out facts and numbers, you make erroneous assertions. I may not agree with all of Jeff's posts, but at least I've learned they are rarely flat out lies. In your case, the BS is too thick to take you seriously.
<<<you mean you don't know that this board is for entertainment purposes only? >>>
As relating to your posts,it's hardly even that.
As relating to Jeff and some others' posts, this is a great place to obtain some money-making info about this company.
Maybe you should include a disclaimer with your posts?