The Emerging Role of Vertical Search Engines in Travel Distribution: A Newly-Vulnerable Electronic Markets Perspective

Abstract

Abstract. Information technology (IT) advances often create turmoil and disturb existing industry structures. We analyze the impact of the Internet and e-commerce technologies on digital intermediaries in the travel distribution sector. We suggest that the emerging role of meta-search agents, which act as shopbots for online travel, lead to the increasing vulnerability of existing intermediaries in the industry, especially the information infrastructure-providing global distribution systems (GDSs) and the distribution-based online travel agencies (OTAs). We base our analysis on the theories of newly-vulnerable markets and intermediation. This supports our examination of the characteristics of existing electronic distribution players in the industry that make them vulnerable to new search engine technologies. The main findings that we report are: (1) technological advances change the defensibility of e-market intermediaries to new value-adding secondary intermediaries, and (2) the valueadded opportunities come from providing consumers with enhanced transparency-based price and feature search, as well as comparison capabilities. Our analysis allows us to make bold predictions about the future of the industry, and to apply our findings to other industry contexts.

Status and development strategies of Chinese travel search engines

“…The development of information technology has enabled the implementation of innovative market mechanism. It challenges traditional travel distribution model and leads a longer value chain [3] , as figure1 shows. For example, OTA has emerged to compare prices from multiple airlines and hotels, and TSE has also emerged to offer price comparison across OTAs [4] .…”

Neural Networks in Big Data and Web Search

“…With this traditional model, customers could purchase travel provider services directly at their offices or through a travel agent. This scenario has now been changed by two factors: the Internet has enabled e-commerce-the direct accessibility of customers to travel services providers' information in real-time with the availability of online purchase [53]-and higher computational servers and software applications can implement the same services as the global distribution systems did, at a lower cost.…”

Examining the tourism distribution channel: evolution and transformation

“…The impact of information technology since the advent of the world wide web has significantly changed and even transformed the structure of tourism distribution (Buhalis and Laws, 2001;Wang and Qualls, 2007). This evolution and transformation of tourism distribution channels, particularly facilitated by information and communication technology, resulted in greater choice for the consumer, increased competition for distribution participants, and a more complex industry structure (Buhalis and O'Connor, 2005;Granados et al, 2008;Longhi, 2008;O'Connor and Frew, 2002).…”

“…This paper provides insights into the change of the structure of tourism distribution that has not been extensively explored. Indeed, the complexity of the tourism distribution structure has been diagrammatically depicted multiple times (Alamdari, 2002;Anckar and Walden, 2000;Bowden, 2007;Buhalis and Licata, 2002;Buhalis and O'Connor, 2005;Chircu and Kauffman, 2000a;Granados et al, 2008;Longhi, 2008;Ma et al, 2003;O'Connor and Frew, 2002;Werthner and Klein, 1999); each depiction has contributed to a fuller understanding of the body of knowledge by focusing on different aspects of that structure. This study builds upon those valuable knowledge contributions by focusing on the evolution of the structure over time, systematically and diagrammatically revealing the progressively larger number of intermediation layers, in spite of concurrent disintermediation and reintermediation activity.…”