Online Reviews of Hotels and Restaurants Flourish

By JOE SHARKEY
Published: January 22, 2008
Many of the reader-generated reviews of hotels, restaurants, destinations and other travel services on the Web may have started their lives as independent blogs by travel buffs. But they have consolidated into major online businesses, taking an ever-growing piece of the market from print guides.

The major sites are TripAdvisor.com, owned by Expedia, and IgoUgo, owned by Sabre Holdings, which also owns Travelocity. Both Expedia and IgoUgo staked their first Internet claims as sites where travelers could research prices and directly book trips. They now operate the review sites as separate businesses.

Like their parent companies, TripAdvisor and IgoUgo are fiercely competitive. TripAdvisor claims by far the greater amount of content, including reviews that are mostly anonymous. Igo-Ugo, on the other hand, requires its contributors to register, and its travel forums and other review material are usually accompanied by member profiles.

IgoUgo pointedly says this differentiates it from TripAdvisor, on which people with vested interests can plant phony reviews.

TripAdvisor acknowledges that an occasional review or forum can be manipulated by a crafty hotel or restaurant owner. But it says the sheer volume of offerings — and the growing sophistication of Internet travel site users — mitigates the problem.

“It’s just very hard to stack the deck with this kind of volume,” said Stephen Kaufer, the co-founder and chief executive of TripAdvisor.com. “On my screen right now, I have 859 reviews of the Sofitel Hotel in New York.”

Traditional print travel guides, whether in book or periodical form, are usually written and edited by travel professionals — some of whom regard the growing online travel review sites as interlopers that barged onto their turf like boisterous day-trippers piling out of their Winnebagos and plopping down next to the members of a beach club.

But Mr. Kaufer argued that online sites have advantages over written guides, including the fact that the Internet reviews are often more immediate and tend to be punchier than guidebook listings.

One of the pioneers in user-generated travel guide information, Zagat Survey, was reported last week to be seeking a buyer. Zagat’s main business is selling print pocket guides with brief summaries of user-generated reviews of restaurants, hotels and other services. Last year, Zagat sold more than 5.5 million of its print guides around the world, but the company has also been aggressively expanding its online business.

A few weeks before the potential sale was reported, Tim Zagat spoke of the difference between the approach of online reviews and Zagat’s, in which thousands of reader-generated reviews are filtered by editors and boiled down to pithy, concise summaries, with ratings tabulated for quality, service, price and the like.

TripAdvisor and IgoUgo, he said, “put everything up raw.”

He added: “We edit the comments and try as nearly as possible to accurately synopsize the results of the survey. We try to make it nice and easy to read — in as few lines as possible.”

Some Internet companies, he said, “are running into the problem that anybody can throw up things on the wall, and after a while there are just too many people doing it.”

Right now, the online business is expanding rapidly, and may soon eclipse the book publishing business.

Both Mr. Zagat and Mr. Kaufer agree that guides printed on paper, being compact and easy to carry, still have a future in the travel review business, perhaps as components of a far more extensive online product.

TripAdvisor.com, founded in 2000, has user-generated reviews and interactive forums on hotels, restaurants, cruises, cities, attractions and even airline seats (through its Seatguru.com site). Like its online competitor IgoUgo, it also publishes photos and even videos from readers, and has sections for reader blogs and interactive forums.

Both sites make money when hotel, restaurant or other ads cause a reader to click through to make a booking. They generate revenue from banner ads and other forms of promotion.

Like IgoUgo, TripAdvisor has a core staff of employees and also employs specialists who “have a nose for sniffing out fraud and who literally read every review.” Both sites also use filters to discourage spam messages. And both are working to make it easier for users to simplify, index online or print out specific information for individual needs on a trip.

Mr. Kaufer of TripAdvisor said he initially worried that the reviews on the site would be overtly negative. “I thought, why would someone typically write a review other than they had a horrible time and they needed to vent,” he said. The opposite happened. People generally like to share good travel experiences, even if they tend to toss in caveats, he said.

Mr. Zagat said that investors in his company have told him, “ ‘Look, this is all symbiotic. We can do both.’ ”

http://www.nytimes.com/2008/01/22/business/media/22reviews.html?_r=2&ref=business&oref=slogin&oref=slogin