Today, 54% of American Internet users — 93.5 million people — research travel online. Travel is the sixth most popular product category on the Web, according to a Stanford University study. In the car rental industry, the Internet’s influence has shifted market and segment share, transformed revenue streams, and improved operations and customer service. For smaller rental companies, e-commerce has also increased profit opportunity and promoted brand awareness previously off-limits.
The Internet tends to foster transparency and remove barriers. While Enterprise Rent-A-Car can create a strategic advantage — indeed, a potential barrier to entry — through technology interface in its core segment, the Internet is an open portal that can reduce such advantage, particularly in other segments.
But to capitalize on this potential, rental operators must understand and respect the scope of the Internet’s influence. Then, through personnel, knowledge and technology, RACs can integrate those strengths into strategy, execution, process and systems.
Who’s Spending Money Online?
Approximately 170 million people use the Internet in America. North American e-commerce is projected to reach $3.4 trillion, representing 51% of the global projection. The number of women using the Internet has now surpassed the number of men. More purchases are now made on the Internet than by phone.
The region with the most phone purchases is the Northeast, while the West has the most Internet purchases.
Travel research is the seventh most popular activity on the Internet. The tenth is buying. About 36% of Internet users shop online. Of those, 14% have bought travel services.
The 2003 J.D. Power Domestic Airport Rental Car Customer Satisfaction Study found that 44% of leisure renters use the Internet to book the rental, up 8%. Among business renters, 39% check the Web, up 9%. In addition, 25% of business and 30% of leisure renters went to a rental company’s Website to make the reservation.
According to ComScore Networks, consumers spent $9.1 billion on travel in the first quarter of 2003, up 31% versus the first quarter of 2002, tracking over $36 billion for the year. The percentage increase is less than half of that for the previous two-year comparison, which was 81%.