Originally Posted by
ma91pmh
Revenue does NOT equal profit!!
I am guessing this has cost them at least 5m if you see how many sites had this running and people making multiple bookings. That's 5% or so of revenue. I am guessing their profit is maybe in 10-20% range, so a 5% decrease in revenue with no offsetting decrease in expenses could be a serious blow to profit!
But equating revenue with profit gave me a Sunday morning chuckle
Specially when we talk about travel agency accounting, since they sell travel products and services on behalf of suppliers. For hotels, car rentals, airport shuttles, event tickets, they can markup from the discounted price they get from those suppliers. For airline tickets, that is not possible. The profit travel agencies make from airline tickets is really small (tiny commission) and from what I have read in this thread, airline tickets represents 70% to 80% of each booking done with the Save300 voucher.
Originally Posted by
ma91pmh
Still not entirely sure Expedia will be footing the bill as has been speculated I am sure some tourism boards are helping.
The question here is how much will Expedia get from tourism boards? I am sure they made their forecasts based on Canadians buying air+hotel packages. The number of times the "Save300" voucher was used might be 100 times higher than what they forecasted, so it will be interesting to see what happens.