Kayak.com’s recent decision to take direct hotel bookings on its website signaled a major shift in strategy for the metasearch engine and highlighted what the company considers a shortcoming in the travel industry’s adoption of mobile optimized technology.

Until now, Kayak’s business model has been to transfer users to online agencies such as Orbitz.com or to hotels’ supplier websites to complete a booking transaction. The new capability will enable Kayak users, through a partnership with the Travelocity Partner Network, to book hotels directly on Kayak’s desktop, website and mobile iPhone application.

“We’ve know for a long time that there are people who would rather complete their booking right through Kayak,” said Robert Birge, Kayak’s chief marketing officer. “The idea is not to change what we offer at all but to add to that extra choice.” Birge admitted that the move essentially changes Kayak’s position in the industry.

“It takes us from being pure search to being more involved in completing people’s purchases,” he said. “It does extend our footprint in the business.”

Orbitz Worldwide did not appreciate that footprint extension. The company said it would go to court to challenge Kayak’s decision to take hotel bookings, in addition to “other issues.”

Interesting Points:

– Five million people have downloaded Kayak’s app to their smartphones, making it one of the most popular apps in the travel market, and in Birge’s words, “by far” the leading mobile presence in the online travel space. He said when consumers are transferred from that app or from Kayak’s mobile website to a provider site that does not have a mobile-enabled website, it becomes a “roadblock” to the purchase.

– Research has revealed that globally, more consumers want to be able to search and make purchases using their smartphones, including within the travel realm.

– Last month, ComScore found that 63.2 million people in the U.S. had owned smartphones during the previous three months, up 60% compared with the same period a year ago.

– Recent research by Accenture found that worldwide, nearly half of the most active mobile device users would welcome the opportunity to pay for goods and services using their mobile phone. And in a report released last month, Phocuswright found that two-thirds of active travelers indicated that they are likely to use their mobile phone to research and purchase travel in the future.

– Starwood Hotels & Resorts Worldwide, for example, has made mobile-optimized technology a priority. Chris Holdren, senior vice president of the Starwood Preferred Guest loyalty program, said Starwood was not among the hotel companies that would create a “roadblock” in Kayak’s booking process. “We’ve spent a lot of time making sure that our mobile experience is what our guests would expect from us,” Holdren said, adding that Starwood was the first loyalty program in the hospitality industry to have a “great” iPhone app and that it has since expanded the app’s availability to the BlackBerry.

– IHG also has a booking app for iPhone, Android and BlackBerry targeting its 56 million Priority Club Rewards program members. The app gives customers the ability to find and book hotel rooms, check rates and view or cancel reservations for all seven IHG brands.

– “Roughly 60% of those who book using our mobile website do so on the same day they stay, in contrast to 10% who do so on our websites,” Keen said. “Mobile is an important channel for us as we service the unplanned or distressed traveler whose plans may have changed at the last minute.”

– Orbitz and Travelocity reported similar findings with their mobile websites.

– According to a survey of Sabre agents last conducted in 2009, Sabre users cite the ability to book air as only the fifth most important feature they want on their mobile phones. The first four are to check in for flights and get boarding passes; change seats; check in and out of hotels; and reaccommodate air in the event of a problem.

– “Mobile is about inspiration, immediacy and individualism,” said Henry Harteveldt, principal analyst with San Francisco-based Forrester Research. “Travelers almost always have their mobile devices with them, and they’re almost always on. Being able to take advantage of location-based services, knowing precisely where a traveler is, opens a new way to serve or market to travelers.

Read the full story here: http://www.travelweekly.com/Travel-News/Online-Travel/Moving-to-sales,-Kayak-pushes-mobile-apps/

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