Orbitz Is Celebrating Its 15th Anniversary Under the Shadow of Expedia Ownership

Orbitz, which finds itself owned by Expedia Inc. 15 years this month after major U.S. airlines founded the site, offers consumers several different options and 130,000 more hotels than it had before it was acquired, and officials plan to play to the company’s traditional strengths.

Hari Nair, general manager of Orbitz and CheapTickets, which was founded 30 years ago in Honolulu, says Orbitz will focus on the airline side of the business, mobile and its Orbitz Rewards loyalty program.

“We want to play to our strengths,” says Nair, who became the Orbitz and CheapTickets general manager in October after working at Expedia since 2002.

Nair says the project to migrate Orbitz and CheapTickets to the Expedia technology and supply platform is 98 percent complete, which means, among other things, that Orbitz offers consumers 130,000 additional hotels, as well as the option to prepay for them or pay at the hotel. Some 25 to 30 percent of Orbitz customers are choosing the pay at the hotel option, he says.

Expedia and Orbitz Differences?

Asked whether what the consumer sees on Orbitz in terms of hotel and flight choices will merely be a clone of Expedia.com, Nair says the “sort order is very different.”

Indeed we compared a flight search on Orbitz versus Expedia and there were considerable differences in the flight options displayed, although a similar comparison for hotels showed only one different property offered among the two sites within the first five results.

There were also a few different features on Orbitz.com versus Expedia. The Orbitz.com hotel results included metasearch price comparisons, showing users hotel rates on other Expedia Inc. brands, including Hotwire, Hotels.com, Expedia, and Travelocity. Expedia.com offered a flight and hotel package option among its first few flight-search results and also a price trends feature showing airfares during the past two weeks. Orbitz didn’t display either of these features.

The Orbitz Rewards program, which pays for platinum members’ PreCheck enrollments and offers two checked bags for free, will be a differentiator with CheapTickets and Expedia, Nair says.

Expedia Inc. now has more than 600 employees in Chicago, who staff a customer service center for Orbitz and CheapTickets, and handle customer relationship management, e-commerce, the loyalty programs, and brand marketing. At the end of last year, before the acquisition, Orbitz Worldwide had some 1,600 employees globally and more than half were in the U.S.

As when it acquired Travelocity in early 2015, the Expedia Inc. acquisition model for Orbitz and CheapTickets is to slash employee rolls, find other cost synergies, move the newly acquired companies to the Expedia technology platform and continue to market the slimmed-down brands.

Most consumers don’t realize when they book on Orbitz, CheapTickets, Travelocity, Expedia.com, or Hotwire, for example, they are doing business with the same company, Expedia Inc.

What Happens to the Orbitz Brand?

Nair says there are considerable differences between the Orbitz, CheapTickets, and Expedia brands in terms of customer behavior. For example, Orbitz is focused more on domestic customers and Expedia supports more international users. In addition, CheapTickets customers are more price-focused and more willing to purchase flights with one or two stops than Orbitz customers, he says.

With the platform migration complete, Nair says it will take another three to six months to assess how it impacts the Orbitz and CheapTickets brands. But the migration was necessary before new initiatives could be considered, he adds.

Meanwhile, Nair says he would love to see Orbitz get more aggressive about marketing and that “active discussions” are under way.

“What is clear is we want to get back into the marketplace,” Nair says. “Orbitz as a brand has been pretty dark for awhile.”