As the first quarter of 2010 comes to a close, the overall feedback from our industry is positive. More people are traveling and spending money and ground transportation operators are happy to see their vehicles rolling more often. The good news doesn’t mean this boost in business is going to sustain us for the rest of the year.

Operators should consistently be looking for new revenue streams. Many of you have returned to more retail work, while others have embraced the funeral market. One revenue stream in particular that seems to be sweeping the industry—and quickly—is online reservations portals. Think Orbitz or Expedia, but for the limousine industry.

Booking travel online is no new phenomenon. The technology is called Global Distribution Systems (GDS)—a worldwide computerized reservation network used as a single point of access for reserving travel-related items—and was originally built for the airline industry, giving travel agencies access to various airlines’ available seating and prices. Not long after, hotels and car rental agencies came into the mix, and suddenly a person’s entire trip could be planned conveniently through one outlet.

In 1995, Expedia changed the way travel was booked by offering everything on its website from hotels to plane tickets and cruise packages. Founded on the principle of offering empty plane seats or unbooked hotel rooms at discounted rates, Expedia delivered. Soon other online travel agencies like Hotels.com, Orbitz, and Travelocity entered the marketplace.

These websites cover just about every aspect of the travel industry, except for chauffeured ground transportation. Travelers can choose rental cars on these sites, but car service has not yet tapped into these resources. In fact, not even the entire limousine industry has moved into offering online reservations in their own companies. According to the 2009-2010 Limousine Digest Industry Guide statistics, only 51.4 percent of those surveyed said they offered online reservations. Already, we’re way behind.

For those who do take advantage of online reservations, 46.2 percent say less than 10 percent of their bookings come from the Web, and 81.2 percent say less than 10 percent of bookings come from GDS travel sites. Limousine Digest is in the process of tabulating the statistics for 2010-2011 and we are seeing an increase from last year’s numbers.

The limousine industry is still lagging when it comes to utilizing the technology that is out there to make money. Operators should take a closer look at the online reservations portals that cater specifically to the limousine industry and that are forging partnerships with some major players in the travel industry to funnel you their business.

Motivating factors

As online reservations software became more readily available to our industry, it made sense for websites to hit the market that would integrate with your reservations software and feed you customers who were shopping for limousine service globally. The founders of these sites will tell you there was a clear disconnect between the limousine industry and the rest of the travel industry. “More and more people are moving to the Web for booking,” says Daniel Leon, VP, corporate development and strategy for GroundLink—a global aggregator for ground travel and parent company of LimoRes.net. “The Internet makes it easier for people to search, find, book, and eventually ride with a company on the Web without leaving their desks.” This growing population of buyers was there, but what was keeping them from ordering limousine service online?

“Nobody was making it easy to buy [a limousine ride],” says Doug Anderson, senior VP of Limos.com. “There is no standardization of pricing in this industry like there is in the hotel industry. Hotels charge one standard fee no matter where you’re traveling from. But limousine operators have different pricing strategies, whether it is per mile or by the hour or a flat rate. It’s hard to standardize and merchandise for the customer.”

Only half of the industry offers online reservations, which leaves a considerable amount of companies out there who don’t have an automated system of pricing or can’t quote you a price until you call and speak with them. “It makes the whole reservations process highly labor intensive,” says Anderson. “Buyers are becoming more sophisticated and are doing most of their shopping online. Why shouldn’t limousine service be a viable option?”

Platforms to Check Out

There is a Web portal available to every operator whether he is retail or corporate, metropolitan or rural. Operators can sign up on any one of these sites and begin to get jobs and leads funneled directly to them.

Here is a list of the variety that is out there:

www.1-800getlimo.com
www.cheaplimorates.com
www.limos.com
www.limores.net
www.limostars.com
www.limoxonline.com
www.onewaylimo.com
www.promguide.com
www.promlimosearch.com
www.transportationworld.com
www.weddinglimosearch.com

This list is not the end all, be all of online booking platforms, but should give you a good starting off point when you’re ready to tap into their revenue streams.

How Operators Will Benefit

Online booking platforms benefit both the consumer and the supplier. Alan Kushmakov, founder and CEO of CheapLimoRates.com, says that it should be a no-brainer for people to sign up for these sites. “From a supplier standpoint, online booking platforms help you market your inventory and match it with a customer who is looking for that level of service in that city,” he says. Some other benefits are listed below.

Access to thousands of customers:
When a limousine operator wants to reach thousands of customers, he’d most likely do so through a cable TV ad, a direct mail piece, or even a magazine ad. These options can get pricy, and the return on investment can be hard to justify. Many people invest in Google’s AdWords campaign and are willing to pay per click onto their websites. Anderson points out that in some major markets like New York, one click could be as much as $10 or $15, and that doesn’t guarantee there will be a sale. “There are a billion people on the Internet; they are a rich target audience. Online booking platforms can give you access to thousands of prospective customers, putting yourself where they are as opposed to attracting them to you,” he says. As we’ll discuss later in the article, many of these online booking platforms have strategic partnerships with leaders in the hospitality, sporting event, or travel industries. As a member company of the platform, you’ll have instant access to those customers.

Efficiency:
Before Limos.com ventured into the online booking platform not long ago, the team did in-depth research and talked to major corporations that commonly use chauffeured ground transportation to find out what they felt was missing. One topic cited was that several limousine companies or affiliate networks still required reservations to be made over the phone. “These corporations are accustomed to doing everything electronically now because it is quick, saves time, and is accurate—lessening the amount of people who need to follow the reservation’s trail,” says Anderson. Not to mention a common operator complaint is the phone calls to the office from people just looking to hear your price. Online booking platforms allow you to input all of your rates and save people from making those “What’s the price?” phone calls and tying up your reservationists.

Cost savings:
If you operate by taking every reservation by phone, how much does each reservation cost your company in time and money? Factor in everything from salaries, payroll taxes, benefits, and utilities and you could be looking at an average of $10 per reservation. Online booking platforms are available 24/7/365 and can be accessed easily from across the globe, leaving your reservationists and office staff the time to focus on other responsibilities. While it may not be a direct concern, taking reservations through the Web may allow you to reduce the number of people working in your office. It’s worth mentioning that few—if any—of these online booking platforms are free. Each one has its own fee system. Some charge a flat amount per number of customers you want to reach, while others don’t charge until you choose to accept a job that a customer requested. Be sure to find a system that works best for you and will get you the most exposure possible. There’s also no reason not to be listed on more than one of these sites.

Control of services offered:
While you will have the ability to assist thousands of customers looking for various services, you can choose which types you provide. Online booking platforms are seeing a majority of retail or recreational trips booked on their sites, especially for proms and weddings. When operators create their profiles, these platforms allow them to select if they want to service weddings but not proms, or airport transfers and nights on the town. Operators can upload vehicle information so if a customer is very particular and wants a late-model vehicle with water and a newspaper provided, he will be able to view that as an option with your listing. Operators can also select the lead time for receiving a trip. Each site varies, but many allow as little as 12 hours lead time or customers can book 2 years in advance. If you prefer more notice so as not to guarantee a vehicle you might not have, then you have complete control over it.

One common operator complaint about online portals is the supposed inability to upsell to customers. In reality, operators have more control and are more likely to get clients who will use them for future services, boosting the bottom line.

Strategic Partnerships

Now that online booking platforms dedicated to the limousine industry are available and gaining popularity among operators, it seems logical to ask when we might see limousine service available on the major travel sites like Orbitz. “I think that is something we’re going to be hearing a lot about in the coming year,” says Kushmakov. “I think there is plenty of potential, especially in this economic climate, for those travel sites to take advantage of the additional revenue stream that comes with offering limousine service.”

Anderson agrees that this would be a logical step, but wonders if Orbitz and other sites realize this yet. “It seems to be the path we’re on, and the online travel industry will be a great source of sales, but there are a number of other options out there,” says Anderson. He points out that everything from online dining reservations sites (www.opentable.com) or event planning forums (www.evite.com) offer just as much opportunity for limousine sales. “We’re building relationships with entities not just in the travel industry,” he says. “A limousine ride would be a great complement to a night out at a top-rated restaurant or imagine being able to book a limousine when you purchase concert tickets.”

The team at GroundLink has partnerships with JetBlue, Delta Airlines, and Royal Caribbean Cruiselines. Rizvan Husain, executive VP of sales and marketing for GroundLink, says building the relationship with JetBlue took some convincing. “JetBlue was reluctant,” he says. “As a low-cost airline, it didn’t think its customers were going to use limousine service. But we did the research and saw that its passengers were getting off the plane and going to high-end places like five-star hotels.” Now the partnership has grown and GroundLink’s LimoRes is directly advertised on the JetBlue website. “Not only are we on the homepage, but we do e-mail blasts together, LimoRes is on the on-board TV screen. JetBlue promotes us heavily.” This is the direction the industry is going. After securing JetBlue, GroundLink also connected with Delta and Royal Caribbean. “We service them everywhere in the world,” says Husain. “Our limousine partners now have access to global clients through a one-stop shop.”

Virgin Airlines began offering limousine booking to its upper-class passengers in just the past few years. Virgin hand-selected the provider for the service in major markets and companies like Windy City Limousine in Chicago and RMA Worldwide in Maryland service Virgin’s customers. These companies used their online reservations capabilities to meet the demand of these corporate executives who were looking for an automated and convenient method of booking limousine service after a flight.

There is a change coming in the industry and as more and more buyers are looking for services online, operators are going to have to adapt.

“How people are buying products, including limousine service, has changed,” says Anderson. “You don’t have to change anything about your business—the vehicles, rates, or hours—you just have to make it accessible to Internet shoppers. If you don’t adapt then you may lose your audience.” Operators need to embrace the technology that is available if they want to bring new revenue into their companies and continue to thrive in the future. LD