New horizons

“Growing the audience is the ticket to getting advertisers to spend more. And of course, the larger you are, the more advertisers you attract.”
-Chris Loughlin

In July 2010, Chris Loughlin took the helm as CEO of Travelzoo, a publicly listed global internet media company that publishes travel deals. Formally Executive Vice President, Europe and Vice President of Business Development, Loughlin certainly knows the company well having worked his way up the ranks since he joined in 2001, when Travelzoo bought the internet company Weekends.com that Loughlin had founded in 1998.

The time that Loughlin has spent within the business has given him the necessary experience to head up the company. "The data from most research shows that being an insider, somebody who grew up inside the business, knows the culture and understands how things are, is a huge advantage to an incoming CEO," says Loughlin, obviously confident that he will be able to take the company forward. 

"I think I have demonstrated in the last five years that I can grow a business into a serious business," he says referring to his previous role as Executive Vice President, Europe in which he lead the development of Travelzoo's business in the UK and its expansion into three other European countries. "I have 90 people here in Europe now. I've recruited every single one of those people. I've built up four countries and we are seeing overall growth rates of 100 percent," recounts Loughlin proudly.

And this is indeed a laudable achievement. Originally, Travelzoo was a company whose main operations were limited to the US, where Loughlin was in charge of business development and had successfully managed the opening and expansion of Travelzoo's office in Chicago. When the London office was opened in April 2005, it was no surprise that Loughlin was drafted in as Senior Vice President and General Manager, Travelzoo UK. By January 2006, Travelzoo's international expansion plan was well underway with the opening of an office in Munich, Germany, followed shortly after by the opening of a Barcelona office in July 2006 and a Paris office in March 2007.

Since Travelzoo started its ambitious European expansion plans in 2005, Loughlin has taken the company through a period of exceptional growth, with rates for 2009 averaging around 90 percent. However, this growth does not mean that the European expansion was plain sailing. Loughlin himself admits that there were a number of challenges that he had to deal with when bringing the business to Europe.

The first challenge was deciding on a corporate structure for the European business. "We had a US business," says Loughlin, "but it was purely in the US, operating in one market. When we approached Europe of course we had all the normal challenges. For example, do we establish it in the UK, in Ireland or in Switzerland? What sort of corporate structure should be had within Europe, so if we opt for the UK, do we establish a UK Limited company? In Germany, should we establish a branch or a GmbH? These questions were are lot more challenging in Europe than in the US."

But this was not the only challenge that Loughlin had to overcome. Expanding into Europe also involved certain complications due to the fact that each European country operates a distinct system of labour legislation. "Although we are a common union, there are very different employment laws in each of the markets. There are different privacy laws, different financial reporting laws etc. So we had to look at each market and at the requirements of that market," says Loughlin explaining that the standard notice period in the US is two weeks whereas somewhere like Germany has a standard notice period that extends from four weeks up to seven months depending on length of service. "You really have to plan those things in and you can't come over with an American attitude and say okay, well, I'll just assemble a team within two weeks and get going.  You really need to think a year ahead."

Operating in a European market also requires a different approach to marketing in each country. Again it is not possible in such a diverse continent to make sweeping assumptions that the citizens of all European countries have the same travel and holiday preferences. "The product offering that we have technically is the same, but the content within those products is a little bit different. Germans, for example, are very prone to taking a package holiday so they expect to have everything included.  Whereas the British in particular, are more likely to hop on an EasyJet and have a hotel booked separately and they don't necessarily expect the evening meals to be included. So, there was a bit of experimentation around how the different markets would respond to different products," explains Loughlin.

Deciding on corporate structures, setting up teams to run the European offices and working out how to best market the products was followed by a host of technical challenges specifically regarding the speed and the functionality of the site. "When we first put the site into beta in the UK, the response time was slower than we would have liked. It was probably close to ten seconds off the homepage. We've now got it down closer to two seconds off the homepage," explains Loughlin.

He says that the company had been trying to implement a lot of analytics concerning what was happening on the home page and how users were interacting with it, but admits that in fact they were probably over-thinking it somewhat. "I think we had a very intelligent approach but we maybe overcooked it a little with brainpower. So we dumbed it down, simplified it, and decided to focus on getting the speed, the prices and the availability right. If we can get those three things right, we can win and people will use it. And we're seeing that now."

Loughlin goes on to explain how they go about measuring the success of the company, which comes down to monitoring the numbers of people who find the company every day by typing the brand name into google - something that shows that consumers have a strong affinity with the brand. The fact that Travelzoo now has over 21 million subscribers worldwide, making it the largest publisher of travel deals on the internet is testament to the company's undeniable success.

However, Travelzoo won't be stopping there and Loughlin explains that the internet business has a very clear strategy for growth and a well defined vision for the future. "The long-term vision for Travelzoo is to be the world's most trusted publisher of travel and entertainment deals. And however that manifests itself, whether it's through deals publishing, through the travelzine model, or through search, we want to insure that whatever we publish is real, it's honest, and it's the best. And if we can do that, we believe that we can attract a very strong following. We already have over 20 million subscribers around the world and we've achieved that is the last ten years. We've accelerated in the last five years versus the first five years in terms of the audience that we've attracted. So, there's no reason why we can't have 40 million subscribers in the next ten years," says Loughlin optimistically.

But doubling subscription figures will not be easy, although Loughlin has a pretty clear idea of how Travelzoo must proceed in order to expand its audience and it all comes down to quality. "In order to attract many subscribers you really have to produce quality news and in our business that's travel deals and entertainment deals. So, we have formally trained journalists here, people from The Guardian, from the BBC, from the ZDF in Germany, and from FVW, which is a travel-trade magazine in Germany. These are formally trained journalists who really focus on producing outstanding content."

Unlike many other comparison sites, Travelzoo also puts enormous emphasis on ensuring the legitimacy of every deal that it publishes. Whilst many other sites post up offers that look appealing at first sight but on closer inspection have hidden costs or certain catches that are not immediately evident, Travelzoo has an extremely rigorous procedure designed to test the authenticity of the deals.

"We go go through what we call the test booking process. Very early in 2006 we established a test-booking center in Munich, and there we have a team of people who mostly come from the university there. They speak all four languages across Europe.  And they constantly test all of the deals that we publish to make sure that you can really book them as a consumer. And you'd be really shocked to see how many deals we find that look great but when you look into it they're actually not available, or there are additional taxes or fees," explains Loughlin.

By pursuing this honest and authentic approach, he hopes to build trust amongst the consumers that use the site and thereby grow subscriber numbers. And this is the key to increasing income, he says. "Growing the audience is the ticket to getting advertisers to spend more. And of course, the larger you are, the more advertisers you attract. But you can only do that by producing quality content. And then of course you have to feed that growth with a kick-start in marketing."

Which is exactly what Travelzoo has been doing. Last year, the company was ranked amongst the top three for internet advertising, has consistently been in the top ten for display advertising in the UK and has been pursuing an aggressive advertising campaign in both France and Spain. But the key appears to be ensuring that the brand is present across a variety of advertising mediums.

"We've really spent quite a lot in online advertising display, we participate in search, we work with the likes of launch groups and we're also interested in traditional media. It really isn't one size fits all.  You could work on TV, you could work on Facebook, you could work on Google, you could run display advertising, you could do PR or you could do other forms of social media. Everything can have a positive impact," explains Loughlin, pointing out that the most important thing is how you service the customers once you have their attention. For Travelzoo, ensuring top customer service comes down to three main things: speed, price and honest availability. "If you can get those three things right on the internet, you've probably got a pretty good business," says Loughlin.

"Our motto as a company - and we see it every day when we log in - is to be the most-trusted publisher of travel and entertainment deals on the internet. And that's all we want to be. There's a difference between trying to capitalise on a market opportunity and make a quick buck and having a vision and sticking with that vision through the good times and the bad times to deliver something that is of value to that market. Those are the companies that ultimately succeed in the long run."

Travelzoo's 2010 achievements: 

September 1, 2010
Travelzoo surpasses 500,000 subscriber milestone in Spain

August 27, 2010
Travelzoo exceeds one million subscribers in Germany

August 12, 2010
Travelzoo tops two million UK subscribers

April 22, 2010
Travelzoo surpasses 20 million subscribers worldwide

January 11, 2010
Travelzoo races into 2010 with 3.6 million subscribers in Europe

Flying High

Fly.com was launched by Travelzoo in February 2009 in the US, and the UK site was launched in August 2009. Fly.com is a "flight search engine" that makes looking for airfares both quick and easy, as the site searches hundreds of airline and major travel sites for real-time fares, and then presents the results in a simple, clean and easy-to-understand format. Chris Loughlin explains the appeal that Fly.com will have for business travellers: "Fly.com was unintentionally built for business. If I'm a medium to small size business I want value. I expect that for medium to small size businesses, travel is probably the third largest expense item in the P and L after salaries and office space and all business owners and business managers want to optimise their travel expense," says Loughlin, explaining that the site enables users to compare the price of flying business class with different airlines.

It was only when speaking to the Chairman of VisitBritain that Loughlin realised the extent of the competitive advantage that Fly.com could provide through its incorporation of business class comparisons. "I actually sat down with the chairman of VisitBritian. Christopher Rodrigues and he said, 'oh my God this is a game changer. You know, who is really going like this site? It's the retired businessperson.'" He continued to explain his thinking to Loughlin saying that when business travellers spend 20 years flying business class, they get used to a certain standard, but they don't necessarily want to pay the prices for business class. Fly.com allows them to seek alternative routes or airlines that may be less pricey.

One of the other differences between Fly.com and competing flight comparison engines is the fact that Fly.com looks up the prices of flights with the airlines and then double checks on the Global Distribution System to ensure that the flights really are available at those prices. "What you'll see when you use a lot of these websites is that they will only do the first step. So, you get the results and what you have to do is click to see if it's still available. And they'll even show you on the screen that this was found nine hours ago because they basically cache the old data from previous searches," explains Loughlin. For Fly.com however, the live look-up is done immediately. This makes it more expensive but it improves the quality of the results, something that Loughlin believes people will come to notice and appreciate over time.