United Airlines today unveiled plans to launch an e-commerce subsidiary dedicated to maximizing the sale of travel products over the Internet and Internet enabled-devices. The planned subsidiary will help United better compete in the burgeoning e-commerce industry through dedicated management and staff resources focused on integrated e-commerce opportunities that enhance the company’s online revenues. In addition, this change will create an employee environment that will enable the carrier to attract today’s e-commerce professionals.
“This organization will allow us to seize new opportunities in the rapidly developing e-commerce arena,” said Doug Hacker, executive vice president and chief financial officer at United Airlines. “The new team, made up of experienced professionals from United’s e-commerce technology and business teams, will allow us to better serve the growing number of consumers who are taking advantage of new ways of buying travel
Initially, a cross-functional team of nearly 70 employees from United’s marketing and technical disciplines will join a new e-commerce division, with the intent to transfer the group
to a newly created subsidiary. It will mark the first time United will dedicate a large group of employees exclusively to e-commerce.
The new company will also create United’s first online sales organization that will be charged with managing the carrier’s many partnerships and relationships with new and existing online travel sites, as well as generating additional online revenues.
In addition, the new company, which will be located in the Chicago area, will create the type of work environment, entrepreneurial culture and compensation structure that today’s e-commerce professionals are seeking.
The new division will be led by Scott Praven, currently United’s vice president-Revenue Management. In his 21-year career with United, Praven has held a variety of positions in the areas of brand management and product development, sales planning, interline marketing and pricing. He holds an MBA in Marketing from the University of Michigan. Praven will report to Doug Hacker. The division is targeted to become a UAL Corporation subsidiary in the second quarter of 2000.
New company will be responsible for United’s Internet and wireless initiatives
United, an e-commerce leader in the transportation industry, has established a strong presence at the emerging travel purchase outlets being used by a growing number of airline consumers. The new company will be responsible for strategies and development in a number of key areas including:
United’s Web site, www.ual.com. The site was launched in 1997 and was the first airline Web site to offer the ability to easily book travel on over 500 airlines, 30,000 hotels and 50 car rental companies. Since that time, ual.com has added customer-focused functionality that allows customers to easily redeem and book their frequent flyer award travel and check real-time flight information.
United’s Internet partnership strategy. The airline has entered into innovative relationships with sites such as star-alliance.com and collegetravelnetwork.com. United is creating new sites such as the BuyTravel.com Web site (in conjunction with Buy.com), and an independent Web site with Delta, Northwest and Continental that will provide customers with a new standard in customer convenience and access to Internet specials from multiple airlines.
Wireless technology. In May, United was the first airline to announce it would offer customers real time flight information through the use of the Palm Pilot VII hand-held device. Other customer-focused functionality is expected to roll out in the first quarter of 2000.