We have covered online travel company Orbitz many times on our various news portals. The once prolific and innovative startup digital travel entity, is now on the negative end of the news again with the announcement the company is being fined by the U.S. Department of Transportation. The bottom line for Orbitz CEO Barney Harford (left) and even TravelPort execs may be as much about public perception as it is about counting beans.
Update: Corporate communication from Orbitz headquarters and their VP of Corporate Communications Chris Chiames, made us aware that we had not properly differentiated the two primary companies mentioned in this article.
So, while Travelport is owned by The Blackstone Group, One Equity Partners, Orbitz, on the other hand, is a publicly traded company, and since the IPO back in 2007, Travelport is only the biggest stakeholder, not the only one.
The ongoing bad news about Orbitz seems to correspond with the company’s downward trend in stock prices, or is it vice verse? Either way, being fined $60,000 for “deceptive price advertising,” as this MarketWatch report suggests, is the very worst kind of PR news for the beleagured TravelPort company. The fact is however, Orbitz has been in trouble for some time, this latest news probably just endemic of companies falling out the bottom – Orbitz and TravelPort are beginning to look for the world like acquisition targets. Orbitz shares have fallen nearly 70% so far this year. The stock stood at $1.91 at close yesterday.
Fumble! That’s a Multi-Billion Dollar Penalty!
On top of Orbitz dropping the airline travel football for Travelport, that company’s announcement of new board changes is no altogether a positive blurb either. Good news about the company’s staggering debt being put off, weighed with the need for appointing new execs Gavin Baiera (Director and distressed securities at Angelo Gordon & co.) and Richard Buccarelli (a managing director at JP Morgan Chase & an expert in mergers and acquisitions) is not exactly uplifting news for some ? A betting investor might assume Travelport may merge with some other player real soon. The question many people have to be asking is, why?
Clearly, knowing the ins and outs of Travelport or Orbitz operations is beyond our scope and capability. Even our sources in those camps cannot be quoted here, but a few other indicators do exist, all-be-it normative rather than empirical ones. This writer has suspected Orbitz in particular to be less of a so called “engaged” company online – one buying into the power of social marketing – than its contemporaries. But, for the sake of argument, look at the Twitter mashup below – a comparative between Travelport (for an instance) and just one arm of LastMinute – the German contingent.
For anyone interested in using online channels to evangelize their companies (and where else should Travelport and Orbitz engage?) a Twitter profile with 133 follows (when the company is in 160 countries supposedly?) and 1260 followers, is quite pitiful. As you can see, just the LastMinute German element is far more powerful. Travelport’s YouTube Channel is vastly underdeveloped too, but most telling for these companies is the horendous use of Orbitz social channels.
Is Rome Burning?
Some 80,000 plus followers of Orbitz on Twitter – and the company actually follows 264. Worse still, even the lowest of the lowly social media marketer could broadcast better than Orbitz does. On Facebook, Orbitz does a decent job of at least “one way” engagement of a quarter of a million fans, but for “integrating” branding and communications? It seems clear to me the company is in “lip service” mode only. On a personal note, I have tried to communicate with the company on several occasions via several channels – unresponsive. This is Travelport’s 40th Anniversary, a milestone for one of the world’s most successful ever companies – and their math seems a bit off to me.
Announcing on the one hand what I would call “techy hype” that engenders readers with the idea Orbitz is a highly technical and forward thinking entity, as illustrated on Om Malik’s GigaOm here – while at best being so oblivious as to their own website’s pricing dogma (if oblivious is the term) – well, these things seem a LOT mutually exclusive. Orbitz has been at this for some time. Operating in the so called “cloud” for super duper data speed – with a potentially game losing problem with the U.S. Department of Transportation – experts might think Orbitz is in chaos mode – something?
Lastly, the GigaOm article sent me looking for a bit more information about Orbitz and how they do business. Not having so much time, I luckily ran across this Slideshare presentation Hadoop and Hive at Orbitz, Hadoop World – the presentation talks a lot about scale and data issues, but for me Orbitz priorities seem to be what I would call “bean counter-centric” and geared toward “saving money” rather than “extending” business. It’s interesting how data people and boards full of banker types often speak the same language – the next time I need a vacation package to Milan, I’ll call my loan officer.
Phil out for now, but if Travelport and Orbitz want to learn how to save money, try making some.
Outside PR firms for Orbitz have included Allison & Partners, and Thornton PR.