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Competition for student travel heats up

Council Travel, the student travel behemoth, now has an air-booking engine on its site,
Until now, its so-called cyber desk was actually agents receiving booking requests by e-mail and manually inputting the orders. That meant that students often had to wait up to 48 hours for flight confirmations. Council Travel’s agents will continue to manually book e-mail requests for hotel, rental car tour and international flight bookings.
Despite its primitive technology, is already the market leader in student travel, according to transaction figures compiled by WebTravelNews. has the lead over its two direct online competitors, STA Travel and logged roughly 52,500 transactions in 2000, representing 7% of its total business (it had a total of 750,000 transactions in 2000). completed 25,000 transactions or 5% of agency’s total of 500,000 transactions in 2000, while Web pure-play logged 30,000 transactions last year. For comparison`s sake, leading online travel agency reported 8.5 million transactions in 2000.
Council Travel (New York, NY) and STA Travel (Los Angeles, Calif.) are two of the leading global student travel agencies; each has more than 50 U.S. retail branches and more worldwide. Both agencies have shored up their Web sites of late, trying to win back students from and
“There was a boom in students using Travelocity and the other online agencies, but they`re coming back to us, because we’re specifically geared toward students,” said Wendy Stapleton, online marketing coordinator for STA Travel. Added Sue Cool, general manager of e-commerce for Council Travel, “We recognize [Expedia and Travelocity] as direct competition, but where we can leverage ourselves is in our flexible airfares and less penalties.”
Council Travel has negotiated student fares with 49 commercial airlines, STA with 37, and with 20. These agencies negotiate a net ticket price with the airlines, then mark up the price to earn their revenues, according to Rob Egan, vice president of marketing at, (Watertown, Mass.), an Internet start-up launched in May, 2000. The agencies then must verify the traveler`s status as a student or faculty member.
Student travel bookings are distinct from traditional travel in other significant ways as well:
á student fares are not only cheaper on average, but they carry fewer restrictions, often allowing the traveler to stay at a destination for up to one year, to cancel and receive nearly a full refund, and to make a change to the itinerary for a small fee;
á student travel agencies sell niche products including international student identity cards, student tours, student rail passes, and hostel memberships.
The entry of in the market a year ago has forced ticket prices down for students, Egan said, because the online agency has less overhead than the market leaders and can offer cheaper prices. is marketing its services to students only through the Internet, partnering with student Web sites such as and and signing up affiliate sites to resell its product.
Council Travel and STA are primarily sticking with their traditional offline marketing and advertising initiatives, executives at those agencies reported, and utilizing their retail branches in college cities and towns to spread the word of their respective Web booking options. Executives at both Council and STA said their most effective marketing channel continues to be word-of-mouth on campuses.
One difference among the agencies is the balance of international and U.S. domestic travel they`re booking: handles roughly 50% international and 50% U.S. domestic travel, while transacts 85% international travel, in part because the agency originated in Australia and has a stronger overseas presence. In fact STA Travel relaunched its Web site in April, 2001, to boost its global look and feel, allowing students in 21 countries to see custom content. is drawing 95% international bookings, in part because the agency`s participating airlines are primarily foreign.
Moving forward, will test its new online booking engine in the North American and European markets for a few months before rolling it out to handle all international bookings., which already accepts online payment for air, Eurail passes and travel insurance, is exploring adding online bookings for hotels and rental cars.`s e-commerce offerings include air, hostel membership cards, bus, insurance and ISIC cards, and the agency is currently focused on marketing these products. and are both boosting their destination content, STA by partnering with Lonely Planet and rewarding its own travel agents for submitting articles, by partnering with the Let`s Go guidebooks.
But executives at all three agencies said their shared task is to inform students of the advantages of student travel fares over published fares. “Forty percent of the student population is unaware of student travel offerings,” said Bart Littlefield, senior VP at, “They can qualify for significantly reduced airfares, lower than those on, plus a lot more flexible. With our product you get ultimate flexibility.”