The announcement late January from FAO Travel in Frankfurt seemed routine, worth no more than a short paragraph in the newsbriefs section.
One of Germany’s largest travel agencies had signed its first dozen corporate customers to its new customizable intranet booking engine. Together, the companies accounted for more than $100 million in annual air volume.
But between the lines lurks another story.
FAO is poised to dominate a burgeoning market for corporate intranet bookings in a way that’s hard to exaggerate. Its technology is far and away the most elegant and intuitive available in Germany, if not on the continent. Moreover, it has practically no competitors.
“Our growth potential is phenomenal,” admits Louis Arnitz, the soft-spoken president and managing director of FAO Travel.
His numbers speak for themselves. The 20-year-old enterprise is the founding German member of Woodside Travel Trust, with more than 300 licensed offices in Germany. It already counts about 300 of Germany’s biggest companies among its regular agency customers.
Late last year, FAO launched the real-time, Amadeus-interfacing FAO Business Travel Online, plus prototypes of its intranet program, into a virtual vacuum. The Web-based booking tool chalked up its 20,000th registered German subscriber a few days ago; its intranet engine, priced at about $3,000-which doesn’t include a maintenance fee of $575 and a transaction fee of $3.50 per ticket-is hardly out of the starting gate but already shows the same spectacular promise.
There’s a reason for Arnitz’ good fortune that transcends the booking engine’s skillful use of Java, the inclusion of user-friendly booking features, and the installation of thoughtful little extras, like a handy currency calculator. FAO’s keen understanding of German corporate culture, says Arnitz, is a key to its success.
“We developed this for Germany,” he notes. “And there are small but important differences between the cultures of the American and the German markets.”
These differences would make it difficult for an American developer to adapt a U.S. booking engine to the continent. For instance, while most stateside corporate booking tools focus on domestic business travel-“Just try to book a flight from an American city to a Canadian city and you’ll know what I’m talking about,” Arnitz says-German road warriors self-book mostly international tickets. In fact, Germany ranks among the top markets for international business travel.
Another important distinguishing factor is the preferred reservations system. “On Amadeus, which is the system we use, some things are functionally easier, and some are harder,” Arnitz says. “Worldspan and Sabre don’t really compare.”
To dissimilarities in CRSs and travel patterns, add the contrast between the end-user interfaces. German users must be treated differently from North Americans. Different how? That’s something that takes years of experience, says Arnitz, “but I can tell you that you shouldn’t translate your booking engine word-for-word into German. That won’t work.”
FAO thinks it knows what works. Maybe that’s why it confidently predicts it will have signed up 400 corporate customers by year’s end.
If anyone can do it, it’s probably Arnitz. His only competition comes from Lufthansa’s proprietary Info Flyway online booking system. Big players like American Express, Microsoft, BTI, and Rosenbluth don’t worry him, primarily because they’re not here yet.
Arnitz won’t be alone for much longer. With 25,000 businesses in Germany, most either online or in the process of plugging in, he can’t have it all to himself.
His advice to inevitable infopreneurs who try to grab a share of the German market is to set up shop in the country and get to know the people. It’s not that difficult and the rewards are considerable.
“I would also say, focus your research and development efforts on the customer, not on technology for technology’s sake,” he says. “Better yet, find yourself a German partner,” he adds with a half-smile. “Give us a call.”
FAO probably isn’t holding its breath for the phone to ring. It’s looking forward to what may be its best year ever, safely concealed behind those little newsbriefs that nobody pays much attention to.