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Expedia Relaxes Registration Requirement

Written By: D. Geller
Published On: January 17 2000

Event Summary

Expedia (NASDAQ: EXPE) has required visitors to its site to register and provide personal information before being allowed to access any data. This has been a contrast with other travel sites such as Netscape Travel, which typically allow surfers to access flight information without registering. Expedia has now decided to similarly allow surfers to access information on the site before registration. Expedia started life as a wholly owned subsidiary of Microsoft but filed for an IPO in November 1999. The new company will be majority-owned by Microsoft and will retain strong contractual links to Microsoft.

Market Impact

Websites want registration for two reasons. First, to deliver a more personalized service and thereby make the surfing experience more valuable to the user. Second, to serve ads that are most likely to elicit a response. However, it has been known for some time that a substantial proportion of users will shy away from sites that require registration. Many sites have done their own research and decided to provide unregistered users with access to significant amounts of free information before asking them to register. Many surfers will give personal information when they see that doing so has value, such as for making a purchase or gaining access to valuable information.

Expedia makes this change at a time when speculation about Microsoft's overall Internet strategy is rampant. On the positive side, Expedia will quickly become a much stronger entrant in this market. We expect it to show strongly accelerated growth by the third quarter as long as it roughly matches the features and advertising of other travel sites.

The more interesting question is whether this signals a shift within Microsoft to a less hubristic position about its Internet properties. Although Microsoft quotes a Jupiter communications survey as its reason for dropping the registration requirement, it should have known to do this at launch. Almost every website or newsletter that discusses registration accepts as scripture that registration is a barrier unless surfers see its value. In fact, a significant amount of the back-end work on Expedia is done by Cahners Business Information (See TEC News Analysis article: "Is Web Success Necessary for CEO Survival?" September 25th, 1999) which has accumulated significant experience with registration through its Manufacturing Marketplace, one of the earliest business-to-business websites. Expedia could have saved itself a large loss in usership (and revenues) just by talking to its partner. If Microsoft missed ample opportunities to hear the anti-Orwellian message that users will decide whether they want to register, it seems to have learned it at last. Some have felt that Microsoft has not paid sufficient attention to what has been proven to work on the net. If this small announcement from Expedia is a signal of a change in attitude in Redmond, then users of MSN and the dozens of other Microsoft properties will welcome it. Also, since many smaller Web-based companies look to Microsoft as an exemplar of best practices, a turnaround in that company's attitude could lead to improved user experience across the net.

User Recommendations

If you have or plan a website with registration, make sure you hook your customers with real content and a clear and motivating reason for asking for registration information. When you do ask for information, make sure that you only ask for what you truly need - long registration forms and requests for unnecessary personal information also drive surfers away.

 
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