Advance selling and internet intermediary: travel distribution strategies in the e-commerce age

We investigate two challenges advance of e-commerce creates for traditional practice of travel distribution. First, we explore whether travel providers benefit from strategically controlling the timing to start advance selling. Second, we study when should travel providers use Internet intermediaries, in particular, should they promote or limit Internet intermediaries' distribution power? We find that the best timing for travel providers to start advance selling depends on the type of demand uncertainty they face. When the key uncertainty is spot demand, travel providers should not start advance selling too early if they expect higher advance selling price in later period. When travel providers face demand uncertainty in both advance and spot periods, they are worse off not using the advance channel; whether they should start advance selling early depends on advance and spot price, and demand ration between advance and spot periods. In studying travel providers' strategic po...

• Type: Conference
• Year: 2007
• Where: ACMICEC
• Authors: Zhe Qu
• Keywords: ACMICEC 2007, Advance Selling, ECommerce, Intermediary's Distribution Power, Travel Providers