This article by Hollis originally appeared in ClickZ on March 13, 2007.

A few months ago, I planned a quickie vacation. As usual, I did the entire process online. I started researching on TripAdvisor. As I narrowed down my selection, I used the “Check Rates” feature to compare offers across various booking engines. I ended up booking with a company I’d never used before, CheapCaribbean.com. I had moderate awareness of it, which helped my confidence as a first-time booker.

Turns out the folks at CheapCarribean are quite exceptional Internet marketers, so much so that shortly after my trip, I contacted them to see what I could learn for my agency readers from founder “Caribbean Jim” Hobbs. I was especially curious to learn how a smallish company like Jim’s competes in today’ ferocious vacation travel market and builds a brand from scratch. Perhaps the most revealing insights from my interview with Jim were not about his active online marketing tactics, but what he and his team no longer do and what he thinks of today’s vacation travel market.

Hollis Thomases: Jim, give me just a little background on how you got started and what you did in the beginning to help build your brand.

Jim Hobbs: In December 2000, I was working in the business and sensed that online travel was going to trend toward niche travel, so I founded CheapCaribbean.com. We tried to develop a means to differentiate ourselves. For example, our included “Free Your Mind” plan of round-trip airport transfers, comprehensive travel insurance, and hurricane protection.

In the old days, you could do well just by buying cheap clicks through paid search. But our real success came from gathering opt-in e-mails from people who came to our site. That list is now more than a million names, and it’s priceless to our CPA.

HT: You mention “the old days of cheap clicks.” Since those days are long gone, now what?

JH: Online marketing is a super challenge now, even getting organic search rankings or growing an e-mail database. Plus, Web analytics is inherently flawed because while 50 percent of bookings are made online, 85 percent of consumers have talked by phone with a travel representative.

With click fraud, competitive clicking, and the high cost of clicks, you just can’t rely on becoming successful through Google and Yahoo. In addition to our e-mail database, we now rely heavily on our affiliate partners. In fact, we’ve pretty much scaled back completely on PPC, and let our affiliates do it instead.

Another big factor is our popularity with travel agents, which we primarily grew through online advertising, mainly e-mail newsletter buys. We took the approach that most travel agents are online all day, so we went to sites where travel agents spend a lot of time and put out great-priced deals and healthy agent commissions. We also rely heavily on word of mouth spread through online travel agent and consumer forums.

HT: Speaking of word of mouth, what’s your take on consumer review sites and social media?

JH: I have some bitter feelings about… all kinds of negative [postings] on sites that can’t even prove someone is a real consumer or one of my competitors. I feel there are too many planted posts. I do like the idea of active forums, however, and we’re getting ready to start AskCaribbeanJim.com for that reason. It won’t be owned by a major trip company like Expedia owning TripAdvisor. On it, I can give opposing viewpoints for negative comments.

HT: What about buying into travel comparison programs on sites like TripAdvisor, Booking Buddy, and Travelzoo?

JH: These programs have raised their rates three to four times in the past two years and are producing less and less, so we’re scaling back on these now, too. This is a real barrier to entry for someone now trying to get into the travel game. Besides, I feel more and more these sites are giving preferred visibility to bigger companies, so the consumer is just seeing the same old thing everywhere they go.

HT: Is it possible to start a new online travel brand these days without deep pockets?

JH: Yes, but you have to have a hook, like expertise, insider secrets, lots of pictures, something no one else does. Having a great price is important unless you’re going after luxury travel, where high-end service is key. Filtering is the future. I want to niche out everything.

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