Start Your Modems

By Leslie Dickstein

Nancy Albanese, a New Jersey mother of three, used to call her travel agent when she wanted to plan a family vacation. But that was ages ago--or about 12 months in computer years.

These days, Albanese does what millions of other Americans do when they want to book a getaway: she logs on to the Internet. Sitting in her family room, she can rent a beach house at the Jersey Shore, check out hotels in Disney World or book flights for a family reunion.

"I like it better than using a travel agent," says Albanese, 44. "I'd rather do it myself. I don't have to call around to all the different airlines to find out who's got the best price that day. You just put in the dates, when you prefer to travel, where you're going, and they come back and give you seven or eight itineraries."

Albanese is not alone. Just in the month of October, some 42 million people logged on to a travel-related website, according to PC Data, an Internet research firm. That's up from 24 million in the same month last year--a jump of 75%. Consumers say they like the convenience of booking online--between work, school and soccer games, who's got time to call around for airplane tickets?--and the low rates they're able to find through agents and suppliers.

Of course, the Internet's strength is also its weakness. With so much information available--there are an estimated 100,000 travel-related sites--it's easy to get lost in a tangle of URLs. Sure, you may be able to get a good price on that airfare from New York City to Los Angeles, but it may take you hours to do it.

The frustration factor is just one of the reasons some consumers still balk at booking travel online. Other obstacles include a continued reluctance to give credit-card information over the Internet (see box) and doubts about online agents' reliability. Then too there are the horror stories about travelers who booked online but got left high, dry and broke at the airport. Says Krista Pappas, director of the e-commerce travel division at Gomez, an Internet rating and research company: "As with anything where consumers are on a learning curve, there is some frustration. Is online booking perfect? No. But I think it will continue to grow and get better."

While they're waiting for improvements, travelers are shopping around. At least 40% visit four or more sites before buying, and many say they simply use the Web for research, then do their purchasing via the phone. Indeed, says Pappas, while travel is the leading segment of e-commerce, only 8% of all travel bookings are made online.

The bulk of those reservations are airline tickets, though industry experts say more travelers are starting to book hotels, cruises and vacation packages. Every carrier has a website these days--as do most hotels, cruise lines and car-rental companies--and many offer special deals that you won't find elsewhere. (Every Wednesday, for example, the airlines sell off their available seats for the coming weekend at bargain-basement prices.) Even if you don't end up buying tickets from an airline site, check there first to get a benchmark for future shopping.

Travelers who want deep discounts and have flexible schedules have made Priceline.com the leading discounter site. You name your price, and Priceline tries to find a supplier to accept it. The catch: you won't know which airline you're on, how many stops you will have to make or what time your flight leaves until the transaction is complete. Once your bid is accepted, you're committed, whether you like your itinerary or not. Newcomer Hotwire.com appeals to the same deal-seeking customer. There's no "bidding" involved, but the same rules apply: no specific information about your flight until after you've paid in full.

Those who would rather spend a few extra bucks than drag the kids to the airport for a 6 a.m. departure may be better served by one of the big online agencies, such as Travelocity.com or Expedia.com Consumer friendly and easy to use, these two megafirms together garner 40% of all online airline bookings. They are also well stocked with air, hotel, car and cruise options and have comprehensive family pages offering helpful tips and trips. One big disadvantage: neither site will allow you to use frequent-flyer miles for upgrades or free flights.

Even travel agents--who everyone thought would die a slow death when Internet booking went mainstream about two years ago--are using the Net to their advantage. More than 60% of all traditional travel agents have their own websites and even more have e-mail. Says Kathy Sudeikis, national vice president of the American Society of Travel Agents: "Were we scared about the Internet? Yes. But it's playing out to be an ally rather than a killer." In this information age, more and more people seem to agree.