

Hipmunk demos at Travel Innovation Summit (video) - kn0thing
http://blog.hipmunk.com/37090485

======
calbear81
I work in the travel space and have worked on the business/marketing side for
metasearch as well as dedicated hotel sites. Based on what's been shared by
the Hipmunk team, I think I have a ballpark analysis of their rev-mets:

150,000 searches/month 40% CTR to Orbitz/Suppliers - 60,000 outbound clicks
15% Conversion to Booking - 9,000 bookings $300/booking average revenue -
$2.7M revenue (meshes with the comment that they generate millions of ticket
revenue to suppliers per month) $3 bounty/booking - $27,000 / gross rev per
month $324,000 annual revenue run rate $180 average RPM (rev/1000 searches)

It's cash flow positive and has no external marketing expenses really. The ITA
agreement will entail cost per search but they will make it up by having
access to all fares which will give them near price parity with the likes of
Kayak and others. Hope this breakdown helps.

~~~
redthrowaway
Looks good, although a little Drake Equation-y. Would you mind telling us
where your figures are coming from? The figures all seem reasonable, but
there's a lot of room for error there.

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pg
It's all the more impressive when you consider that Adam only graduated from
college this year. If he'd gone to work at a big company instead of starting
his own, he'd still be merely a promising junior developer or something.

~~~
brandonkm
I don't know anything about Adam and the team at Hipmunk, but I no longer even
consider other sites when it comes to searching for flights. The people who
I've recommended Hipmunk to have said the same. Their focus on user experience
is (even for a startup) uncanny.

The word disruptive is thrown around a lot and often way out of context. I
believe Hipmunk and Airbnb are _actually_ disruptive.

~~~
aberman
My gf said she couldn't figure it out. I seriously almost broke up with her on
the spot. I LOVE hipmunk.

~~~
kn0thing
You chose wisely, aberman. In the event that she breaks up with you, though,
email me (alexis@hipmunk.com) your mailing address and I'll send you something
from the hipmunk to ensure you get through the trauma.

~~~
alnayyir
Clearly I need to acquire and dispose of a g/f quickly so that I can get
hipmunk swag ___

Btw: used you guys to get an upcoming ticket to Malaysia. Love the service :)

~~~
kn0thing
Haha! Well, If anyone is reading these comments - you can email me your
mailing address too. No break-ups required! We don't want to encourage
anything like that :)

Enjoy the trip to Malaysia! Can't wait to visit one of these days.

~~~
alnayyir
Sent.

I actually got tips for the trip from Raldi on my thread in r/travel.

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jsolson
I keep meaning to mention this in a context where Hipmunk people might see it.

One little piece of design advice I'd give you based on the reaction of _every
single person_ I've shown the site to (which is in the tens at this point), is
that, initially, the display for layovers is unclear.

A flight with a single layover looks like three flights because it is three
separate blocks. I think you could fix this by extending the color of the
boxes on either side into the connection box region. As that may not be at all
clear, I've mocked up what this might look like:
[http://dl.dropbox.com/u/144762/Screen%20shot%202010-12-22%20...](http://dl.dropbox.com/u/144762/Screen%20shot%202010-12-22%20at%2010.56.00%20PM.png)

I think it makes it more obvious what's a flight and what's a layover. Just a
thought.

~~~
spez
/acknowledged

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mrchess
Wait, they are trying to patent tabs and hiding search results? You can
seriously do that? Isn't that a little broad?

~~~
patrickaljord
Yes, shame on them for that. I won't use their service for that reason.

~~~
rewind
I think there's a big difference between applying for a patent for protection
vs. applying for a patent to wield it as a sword. If your company could get a
patent that it could use as a defense against a big company that held other
similarly-ridiculous patents, but with the deep pockets to sue you, you'd be
foolish not to at least consider it. Not liking the rules of a game is not
reason enough to ignore them if it means your opponent will leverage those
same rules to knock you out of the game altogether.

~~~
carbocation
> I think there's a big difference between applying for a _patent for
> protection_ vs. applying for a patent to wield it as a sword.

Patents for protection... Like Sun's patents, right?

~~~
rewind
I didn't say that all patent applications are for protection.

~~~
carbocation
I guess I was trying to express the following: I believe that Sun's patents
really were intended defensively, but upon their acquisition by oracle this
got turned on its head.

~~~
rewind
Gotcha. Didn't read it that way originally.

~~~
carbocation
Yeah, sorry, it came off snarkier than I had intended.

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staunch
I'm totally impressed with how aggressive Hipmunk is being. Picking a fight
with Kayak is awesome. The hardest thing they'll have to do is avoid being
acquired.

~~~
kn0thing
Thanks!

...

Oh wait, there's one more thing: <http://blog.hipmunk.com/hipmunk-is-excited-
about-2011>

~~~
samratjp
Hipmunk should be the person of the year ;-)

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guelo
Did yesterday's announcement by AA that they were pulling out of Orbitz affect
Hipmunk and the other meta-search sites?

EDIT: I just noticed someone asked that question at the end of the video and
Adam didn't have a very good answer. Also, boo on the patents answer.

~~~
goldfish
I'm no fan of software patents either, but nowadays it really can be a matter
of company survival. If some big, entrenched player starts picking on you with
their patents, and you don't have anything of your own to defend with or
cross-license, you're in bad shape.

Don't hate the player, hate the game.

~~~
guelo
That's fine but the question was about what you will do when competitors start
copying the features, patents is a bad answer to that.

~~~
redthrowaway
The question was actually, "how are you going to protect your intellectual
property and keep competitors from imitating you?" Patents is a fine answer to
_that_.

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kessler
How does Hipmunk make money? Commissions on flights are extremely, extremely
low. That's why sites like Kayak, Orbitz, etc. are plastered with ads - they
make the majority of their money through advertising and upselling.

~~~
arn
As I recall they make money on Orbitz' affiliate program.

~~~
prs
They received VC funding of $1mm. So that will buy those 3+ [1] developers
some time.

According to an Oct 2010 article by TechCrunch [2] "Orbitz pays Hipmunk the
standard rate of $3 per flight sold". Hopefully they did some renegotiations
recently or have some other contract in place that generates Hipmunk more
income.

[1] [http://replicatorinc.com/blog/2010/11/alexis-ohanian-
hipmunk...](http://replicatorinc.com/blog/2010/11/alexis-ohanian-hipmunk-
digital-souveniers/)

[2] [http://techcrunch.com/2010/10/06/how-hipmunk-almost-
became-b...](http://techcrunch.com/2010/10/06/how-hipmunk-almost-became-
bouncepounce-com-and-other-strange-tales/)

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yogipatel
Great presentation! I'm curious, where did you guys get your flight
information from before the ITA deal?

~~~
calbear81
Orbitz.

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jasonlbaptiste
HipMunk is doing something smart and focusing on the presentation layer to
win. Design and presentation seems simple and just a "feature" to many, but
that's because it's done well. In travel search and many other areas, all
things are virtually the same + a commodity. By focusing on the presentation
layer, they actually bring about a very very strong advantage, especially in a
process that people hate.

~~~
brown9-2
Is there any data available that backs this idea that flight travel customers
will pay a premium for nice presentation and design?

~~~
notahacker
it's not about paying a premium (they're referring users to the same tickets
at the same prices). It's being about the site that consumers bookmark.

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dmix
I like the 80s sitcom opening music.

~~~
kn0thing
You have no idea how tempted I was to go all the way and replace it with Benny
Hill...

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patrickaljord
The reason why the "non-stop flight" checkbox isn't checked by default on most
sites is because flights with stops are much cheaper usually. Also hipmunk
results are usually always more expensive than other traditional sites, at
least for now. Maybe they should focus on getting the best offers, that's more
important than UX on that kind of sites, I mean look at godaddy for example.

~~~
scotje
Different people place importance on different things. The "people who buy
airline tickets" market is probably large enough to withstand some
segmentation.

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rishi
very compelling demo

