Google risks becoming seen as the enemy of the free internet rather than its facilitator, the former boss of leading UK OTA Kane Pirie has warned.
Speaking at yesterday’s 11th annual Barclays Travel Forum Pirie, who exited the company following its sale to Dubai-based dnata Travel, said PPC marketing was no longer working for many firms.
He said in the early days at Travel Republic paid search on Google was “like putting money into a broken fruit machine”. “You put 50p in you got £1 out”, he said.
However, he said those days are now gone and most businesses were now focused on how to get around Google.
“With the costs of PPC it was fabulous, now it’s broken the other way, so a lot of people are reducing their spend [on Google] and finding other ways to get the business in.”
Pirie said a well as Google’s auction model seeing search terms increase in cost, the search giant has also reduced the number of links and in doing so contributed to inflationary marketing costs.
And he said the search engine is trying to keep users on its own site and products as much as it can instead of passing users on to the sites they are searching for.
“Google has to be careful. They are getting to the point where they are positioning themselves more as the enemy of the free internet, rather than facilitator of it,” said Pirie.
Pirie told the audience of 300 senior travel executives that he was actively looking to return to travel saying he missed the industry and has a “Travel Republic-sized hole in his life”.
He said he has had some offers to invest in companies, but that it takes time to find the right one.
Pirie said he expects long-haul to do well this year as holidaymakers’ habits change and claimed there was a gap in the market for someone to be really aggressive on price in short-haul.
He claimed this was partly down to the costs of marketing on Google but insisted money can be made by discounting in the short-haul market.
In the same panel session Rita Sharma, founder and owner of Best At Travel, described Google as a “necessary evil” but said her businesses had changed strategy this year to focus on margin not price.
The firm has decided to reduce its Google budget by 15% as it looks to work more on ROI and conversion than driving traffic through paid search.
“Our key focus is getting margins,” she said. “We have been in a bit of a bun fight for the last two years were we have driven our own margins down.
“We have a lot of wastage and there was part of the budget we spent on Google not making us money. Some of that money should have been on our bottom line.”
Sharma said the firm had chosen its key hotel partners and was focused on driving greater numbers of customers to them.
“In the last few years we were really focussed on being offensive – in terms of fighting competition – and found we were stuck in the middle of selling on price, which is not really a strategy.
“We came back this year to focus on our key strengths and what our year end results should look like which is to be profitable and to audit most of our costs.”
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