Karma Happens

Tom and I were round Nicole’s for dinner the other night and Nicole sounded a bit peeved when she discovered Tom had received an invite to SkooshKarma and she hadn’t. ‘It’s not as simple as that’, I explained patiently, ‘it’s organic and spiritual, it needs to come to you’. She looked blank so I added ‘think of it as part of a long journey without a timetable’.

Nicole gently nodded and I thought I may have gotten through. ‘Think of tonight’s dinner as organic and spiritual and part of a long journey up your karmarama!’. We left it there.

Everyone will be invited in time but SkooshKarma will mean different things to different people, that’s always been clear. For some it may appear a strange juxtaposition of political outrage and sound commercial thinking. For others, a good place to book a cheap hotel. At the risk of sounding like El Duderino, there is no right or wrong, man, there’s just a lot of ins and outs.

The way I see it, people can be broadly divided into Puppies and Hedgehogs. Puppies are adorable things but about as stupid as you can practically be without the benefit of recreational drugs. They’ll endlessly run after balls, stones and anything that looks like a ball or stone without any recollection of having done the same thing fifteen seconds prior. Most football players and celebrities are the human equivalents.

And then there are what Isaiah Berlin terms Hedgehogs. These creatures are virtually indestructible because they have the ultimate defense in that they can roll into a spiky ball to deflect any predators. In this bracket we have esteemed scientists like Richard Dawkins, the vast majority of politicians, many religious folk and the scourge of all mankind, consultants.

Until I was 28 I was a self-declared Hedgehog. And then I discovered that everything I thought I knew had been grossly misinformed to me by other supposed Hedgehogs in the form of teachers, rabbis, employers and the like. So I disappeared off to an island in Indonesia to reflect on what I actually knew for myself. It was a humbling and intensely disturbing experience. The more I prodded the more my bank of intellectual learnings dissolved in front of my eyes and eventually I was stumbling around and yelping like a demented puppy.

That’s another story in its own right and, as we know, I recovered at least a semblance of knowing the odd thing even though, inside, I am fully aware that I know nothing. This was all brutally reinforced to me twice recently. First, when my hero, Lance Armstrong, turned out to be a sociopathic junkie and then when I read Nobel Prize winning, Daniel Kahneman’s, ‘Thinking Fast and Slow’.

If you have any Hedgehog-like pretensions I strongly recommend you read it. Either way, here’s your executive summary. Everything on average is average. Anything that appears to be anything other than average is an illusion but readily and confidently explained by so-called experts in the field.

It gets worse. It turns out that these experts, whether they be scientists or stockbrokers, racing pundits or wine connoisseurs, are considerably worse at understanding and predicting their own areas of specialization than dart throwing monkeys. If you hear someone start a sentence with ‘I believe’ or ‘I think’ walk away. If they tell you they actually ‘know’ something to be true, punch them.

With that out the way, let me tell you about SkooshKarma. It’s a hotel booking site, sure, but there’s so much more to it. It is the culmination of fifteen years of deep thinking and a visual representation of how I believe things to work. It is premised on Buddhist philosophy, powered by the laws of nature and challenges, if not entirely dismisses, conventional commercial wisdom.

This is going to be lost on most people, of course, but you strike me as the sort of person capable of grasping the subtle complexities. And, on that basis, I’d like to personally invite you in. You just need to click on the invitation on the left and come inside to see what the fuss is all about.

If you spot anything in there which you think you could do better just pop me over a message and I’ll file your suggestions with my whistle and dog biscuits.

Final Open Letter to F.T.C. Chairman Jon Leibowitz

Dear Mr. Leibowitz,

Almost exactly 2 years ago in November 2010 I brought to your attention the fact that the largest travel companies in the U.S. were working together to preclude price competition in the hotel industry. I’m not sure how much time you were able to spend reviewing my case or whether you deemed it a priority. I assume not. The situation has now got worse.

It was announced yesterday that Priceline has bought Kayak. In other words, the most dominant force in the hotel industry has acquired the only significant price comparison site in North America. It’s a crushing blow for the travel industry and the consumer.

The consolidation not only reduces competition but also removes downward pressure on prices. Priceline works on a commissionable model with hotels so the higher the rate the customer pays the better it is for the company. Indeed, Priceline has spent half a decade forcing its competitors to raise their prices.

As a price comparison site Kayak should in theory seek out the best discounts for its visitors but, as a result of price parity in the hotel industry, it has no competitors and will get paid advertising revenues regardless of the rates available on its site.

You may suppose that there’s sufficient inter-brand competition to keep the market fluid but that’s not the case. Hotel chains also work on a commission so they want to sell at the highest rate possible and they hunt down discounters, with threats of legal action.

So it has long been in the interests of all the major players to keep rates high (and, remarkably, at exactly the same level) and now they are joined by Kayak, the one company which should be setting competitors apart in aid of the consumer.

I don’t propose to open up a formal complaint against this acquisition because I feel that Skoosh has done more than its fair share to highlight the imbalance in our industry. At the same time, I could not watch this one pass by without note. Consumer have been hurt badly enough by the banks, we don’t need this nonsense in the travel industry.

If the F.T.C. doesn’t step in with the greatest of urgency, the hotel industry in the United States will be so skewed by this latest monstrous tie-up you may never be able to unravel it.

Yours sincerely,

Dorian Harris
Director

Troll Models

Jimmy Savile wasn’t my hero. I’m not just saying that now, even when I was a youngster I could barely look at him he was so creepy. But I liked what he stood for – Possibility.

In retrospect it was about Jim, not you, making things possible, but I didn’t see it that way as a kid. It was possible for a young boy to fly in a glider, meet Michael Jackson, stand on the football pitch at the start of the F.A. Cup Final. I didn’t need Jim to fix it for me, fortunately, it was just amazing to think that these things were even possible.

The fact now that Jimmy has been outed for serially taking advantage of children is bewildering. I shudder to think of all the people who knew but felt they couldn’t say anything.

I don’t often share my views on paedophilia because they’re not necessarily palatable to everyone but I’m thinking the subject may not come up again soon, if at all, so I’ll go for it whilst it’s out there.

I don’t think we should exhume Jimmy and hang him. I think we’d be hanging ourselves.

The way I see it, paedophilia is society’s responsibility, every bit as much as the individuals. We have demonised these people. We’ve made it almost impossible to talk about paedophilia. I wouldn’t rush out to put my name on the register and risk universal scorn. Would you? And we don’t have to live with the torture of having been tortured ourselves as children. The crushing double burden of seeing yourself as worthless and society seeing you as evil.

Talking about paedophilia doesn’t make it socially acceptable. It just makes it possible to explain to those who need it explaining to that sexual contact with someone too young to be able to sense its significance is intensely damaging to that child.

Still, for all the harm done, I can separate Jim, the man who inspired me to wonder about all the things I could do in life, from Jimmy Savile, the grotesquely scary paedophile who inflicted his illness on more children than I even care to think about. Either way, he was no hero.

But then there’s Lance Armstrong who was unquestionably my hero. He ticked every box. His tactics are masterful. He studies the route to the last bend and traffic island. He learns about drag-coefficients and respiration to the point he could lecture on them.

A supreme commander, no team-mate gets left behind in his battles, and he’ll be the first to drop back and rescue the injured. A true sportsman, he will wait for his nearest rival to get back in his saddle after a crash because, when Lance wins, it must be fairly and squarely.

Or so I fucking thought.

I can’t reconcile Lance in the same way as Jimmy. Neither of them told the truth, both of them held themselves up as beacons of possibility, but Jimmy was a fruit-cake whereas Lance looked like he would sit well as a (good) politician.

I believed his oft repeated mantra that after the torture of his unusually intense, but life-saving, cancer treatment he would never put another unnecessary substance in his body again. And now I’m told he was racking up lines on his handle bars half way up a mountain. It’s all a bit much to take in.

In SkooshKarma I know that I am too setting myself up as a model of possibility. Of what happens if you give back as much as you take. And I expect to be challenged on that. If it gets off the ground and suddenly my knuckles are pulled to the floor by bling I hope some decent soul slaps some sense into me. If you catch me cruising about town in a bright yellow Ferrari, feel free to gently ram me off the road.

But I don’t hold myself up as any sort of moral authority, I can tell you that right now. I only know what I want to believe is true, and if Lance is too high on narcotics to get any sense out of and Jim is too busy fiddling with kids to fix it for me, I’m going to have set the standards for myself. Perhaps that’s the only way.

Rate Parity – The End Game

I’ve told the press that I think the days of rate parity are coming to an end but, with one exception, they’ve yet to quote me so it looks like I’m going to have to say it myself.

As you may imagine I’ve been following the recent developments in the world of hotel price fixing with fascination. In less than a month the Office of Fair Trading made formal allegations against three of the biggest players in the industry (Expedia, Booking.com and Intercontinental Hotels) and then a law firm in the States started a class action against a whole lot more industry giants. And, yesterday, another.

The press have followed the case closely and there has been a modicum of detail added by journalists. Some have recognised the case has wide implications for an industry which, it transpires, is largely based on a price fixing model. There’s talk of a possible need to shift the purchasing and sales models worldwide.

What I haven’t read yet but which occurred to me is that we’re closer to that point than many realise. Are you ready for a crash course on the hotel industry and competition law?

The two biggest players in the O.F.T.’s case are Expedia and Booking.com. They’re direct competitors but have somewhat different models. Their selling prices are both directly connected to the hotels’ own rates (and, as such, to each others) but Expedia contracts a net rate (or ‘merchant’ rate as they call it) and Booking.com a commissionable rate.

As a consumer this is partly academic. It doesn’t matter whether you book your hotel through Expedia, Booking.com or with the hotel directly, you’re going to get the same price.

It was all level pegging then, crucially, it was revealed that Expedia applied for Type B immunity at the point that the investigation started with the O.F.T. Furthermore, it is only being investigated for the period up to Sep 2010 which suggests to me that they’ve already stopped doing whatever they were told they shouldn’t be doing – i.e. forcing hotels to sell at the same price as them.

So, short of the O.F.T. dropping charges against Expedia, they’ll continue to cease price fixing in the U.K. and, we may assume, in Europe also because the law is the similar there. Meanwhile, Booking.com is continuing to enforce price parity and is publicly stating that it will vigorously defend its right to do so. As it has a somewhat different model to Expedia, it may put forward an argument to say that it is entitled to maintain rate parity even if Expedia isn’t, but to what end?

The thing about rate parity is you can’t have some companies working with it and others not. Booking.com could, if it chose, take this case to two further rounds of appeal but all the while it’s defending its right to charge the same price as the hotel, its biggest competitor, Expedia, released from the shackles of rate parity by its own doing, will be able to undercut them. And, because both company’s contracting models are related directly to the hotel’s own price, Expedia would know exactly what Booking.com and the hotel are charging themselves.

You might think Expedia’s application for immunity on that basis was a very smart move. It doesn’t quite get them out of any possible fines as incorrectly reported in the press. However, if they suspect that there are no good reasons why they should be involved in vertical price fixing then perhaps this was their best shot. They get to dob in their biggest rival and undercut its prices.

There have been some vigorous denials, both here and in the States, that rate parity is illegal, and it may take a while for the authorities to judge that one way or another. But, already, all the thousands of hotels which complied with the practice under duress, are learning that this clause in their contracts, and the associated badgering to comply with it, is at best suspect and they may not be quite so quick to comply.

From where I stand it looks like the rate parity game is nearly over. And you can quote me.

Open letter to William Baer, Arnold & Porter LLP

Dear William,

I have been reading with great interest your nomination to head up the Justice Department’s Antitrust Division. Particularly significant to me was to hear your stance on resale price maintenance with respect to the Leegin case.

Some background. Skoosh is a small U.K. based online travel agent (O.T.A.) specializing in hotel bookings. Until 4 years ago our business was growing at an impressive rate. We operated at small, but healthy, profit margins and much of our business came through price comparison sites where our competitive price advantage was clearly visible.

Then the industry started to move against us. Initially, some of the world’s major hotel chains wrote to me directly demanding that Skoosh either raised its rates to the same as the hotels and its other distribution partners (a practice known in the industry as ‘rate parity’ – see ‘Holiday Inn New York’ attachment) or remove the hotels entirely from our site.

Under concerted pressure from the chains, often accompanied by legal threats, we sometimes complied. Where we didn’t, the hotel chains went to our wholesale suppliers and pressurized them to disconnect their properties from Skoosh. Our main U.S. supplier complied and our $4m account with them dwindled to nothing.

Before departing the U.S. hotel business, Skoosh approached the D.O.J. to review the matter on anti-trust grounds. After what appeared to be a rather cursory examination of the case, the D.O.J. rejected our complaint. The sole argument, it appeared, was that post-Leegin there was no appetite to examine these sorts of cases in such detail.

I took the same case to the Office of Fair Trading (O.F.T.) here in the U.K. along with a weight of written evidence showing the level of intimidation that was being applied to Skoosh, our suppliers and some of direct competitors. After reviewing Skoosh’s claims for 6 months the O.F.T. began a formal investigation.

Last week, the O.F.T. issued a Statement of Objections against three of the main proponents of rate-parity. – Booking.com (subsidiary of the U.S. company Priceline), Expedia and the Intercontinental Hotel Group (I.H.G.). My understanding from reports in the press, Expedia has applied for immunity whereas Booking.com and I.H.G. deny any wrongdoing.

The case I brought to the States was the same as the one in the U.K. although with one significant difference. In Europe, rate parity has been developing rapidly in the last few years and my intention here was to try and halt its expansion whereas in the States it is already pervasive across the entire hotel industry. Skoosh was blocked over there in every direction. Shortly after the O.F.T. announced the start of their formal investigation our biggest trading partner, Kayak, cut its partnership with Skoosh with no explanation despite 5 successful years of cooperation.

From a consumer’s perspective, which I understand is core to anti-trust cases, what’s happening is this. Hotel chains and O.T.A.s are agreeing to sell rooms at exactly the same price and they are all, in turn, guaranteeing to the consumer that the best price is available on their own sites. What they’re not saying is that the confidence of their guarantee stems from the fact that they have agreed to sell at the same rate and that they collude to intimidate any companies openly discounting and withdraw supply from them.

Effectively, small companies like Skoosh which take the standard approach to gaining a foothold in an industry by undercutting their larger competitors (as their lower running costs enable them to do) have been precluded from doing so in the U.S. hotel industry through the aggressive enforcement of R.P.M. Booking.com has an army of rate parity monitors operating from offices worldwide.

I strongly believe that the lack of clarity in competition law post-Leegin was the main contributing factor inspiring large companies in the hotel industry to take advantage of the situation. Most likely the same practice is right now being extended to other industries.

I realise to a greater or lesser extent that I am preaching to the converted. I’m not sure to what extent you’re able to assess the merits of this case in the States prior to your appointment but I trust the matter will be of interest to you.

For Skoosh’s own protection and in the interests of transparency I have included a copy of this email on my own blog. I would not necessarily expect you to reply publicly (or, indeed, at all) and I will keep any response confidential should you wish me to do so.

Yours sincerely,

Dorian Harris
Director
Skoosh

Serve and Obey my Arse!

I got spooked yesterday. Someone had made a booking on Skoosh and found the site using the search term ‘Dorian Harris Haberdashers Skoosh’. I didn’t know him but a little research showed that he went to the same school as me, Haberdashers’ Aske’s (‘Habs’), and he must have somehow stumbled across this blog.

Until recently I’ve held my old school in very low esteem despite the fact that it was the best school in the country when I was there. And I mean the very best. Both Oxford and Cambridge had quotas restricting entrance from Habs because there were simply too many of us getting into their hallowed grounds (55 from my year alone).

And it spawned a fair number of stars. David Baddiel was a few years above me, Matt Lucas a year below. We never met personally, but that bastard Sacha Baron Cohen, two years my junior, beat me in an essay writing competition (and I cheated!).

For all that I despised the place and everything it stood for. The official school motto was ‘Serve and Obey’ and the unofficial one, as one of my contemporaries encapsulated in a book based on the school (‘New Boy‘), was ‘Go to Oxbridge or die’.

From as early as about 8 it was clear that I was more likely to get into borstal than Oxbridge so I languished in the bottom sets for everything and, along with a few fellow imbeciles, I dedicated myself to undermining the system in every way possible from cheating in exams to studiously bagdering teachers until they screamed or had nervous breakdowns. One of them, Mr. Hale, went so far as to tell me he hated me. His actual words were ‘Harris, you’re banal, bombastic and condescending and I hate you’. I thought that was pretty eloquent off the cuff, even for an English teacher.

For the best part of 30 years I resented my parents for being desperately middle class and blind to that obvious fact that I was totally unsuited to the school. I’ve never served and obeyed anyone, not even myself. It seemed that it was more important to my mum and dad to be able to name-drop their son’s school around their perma-tanned social-climbing friends than to look at me and see how painfully frustrated I was.

And then I got to the age when my friends were choosing schools for their kids and I saw what a horribly tricky decision it is. Of course you want better for them than you had yourself. My mum felt humiliated all her life for never progressing beyond O’levels. My dad got into Haberdashers and his parents couldn’t afford to send him there. Where else were they going to put me but the best school in the entire country?

I didn’t get around to this realisation in time to tell mum but dad, if you’re reading this, sorry and thank you. I want you to know that I don’t harbour bad feelings against the establishment any more, nor you for sending me there. Not even against Sacha Baron Cohen for trouncing me at the one thing I thought I excelled at, Mr. Pearman for punching me for ridiculing his limp and I no longer even fantasise about exacting my revenge on Mr. Hale, the patronising, petulant, dickwad.

Price parity, evolution and dandruff.

For anyone on here to read anything but economic theory so dry it makes dandruff look squelchy, please be on your way. You won’t thank me.

For everyone else I’ll make plain my starting point. I consider myself an evolutionary economist. To put that in perspective, I have a ‘c’ grade at economics A-level. It was a double lesson before lunch and I spent my time drawing my lunch rather than listening to Dr. Wigley and the specifics of micro-economic theory. I remember a couple of useful things such as the latin term ‘ceteris paribus’ – all other things being equal.

After I left school and distanced myself from the stultifying boredom of the classroom, I taught myself evolution and almost everything else I’ve understood subsequently fits into that. The free market, for example. Make everything possible and see how it develops. Any restrictions you impose will constrain growth.

And that’s my principle argument against price parity. It’s an artificial construct. We don’t have anywhere in nature where all things are equal by diktat.

Some proponents of price parity argue that it’s a natural evolution. They never quite spell it out but I infer from that they mean under perfect competition there will be a tendency towards equal pricing. If Asda sees that Tesco is selling Sunpat Crunchy Peanut Butter for for £1.49 and they know Stan from Peckam Rye is aware of that then, ceteris paribus, Asda will price at £1.48. I like nice simple arguments and that’s nice and simple.

My arguments against that idea are 3-fold, namely:

1. Perfect competition doesn’t exist

I fully accept that 20 years ago it was merely a textbook construct and that the internet has changed that. It is theoretically possible, now or in the near future, for companies to know their competitors prices and to price accordingly.

But that’s a very long way from perfect competition. The competitor’s cost structure is also a component. Even that might be public knowledge at some point in the distant future (I’m all for that) but then there’s personal choice. Consumer behavior. Stan cares more about the natural affinity he has with Tesco by virtue of the fact that his surname is Tasco than the 1 pence he’d save as Asda. It turns out that factor alone is worth up to 7% on every purchase. Who’d have thought it?!

2. We’ve tried it.

We used to have perfect competition in a sense. Back in the 80s it didn’t matter which bookshop you went to in the U.K. because they all sold the same books at the same price. In the 90s the competition authorities thought that was a rather daft idea and abolished it. Now you can even buy 3 books for the price of 2. It’s gone crazy.

We also tried it in Soviet Russia. Big Time. We simplified everything to just one store. None of this looney price comparison nonsense. The consumer bought what they could at a price they could afford and the seller sold at a price it could afford. It was grey but perfect.

3. Let it be.

If there really is a natural tendency towards price parity then let it happen. You don’t need to contract it and enforce it.

I can well believe it will happen but I have no idea what it will look like except that it’s very unlikely to be a static because nature doesn’t do static. Maybe there will involve two very closely contested companies. Maybe twenty or two hundred. Or maybe there will be a dynamic equilibrium, like the tides and the seashore, with gentle price swings one way or another or massive price swings like our own economies.

The point is, I don’t know. It’s entirely possible that I slept through that lesson in which case I do apologise, Mr. Wigley, it’s just when I’m hungry my mind goes to jelly. If anyone else was listening that day or, indeed, you’ve heard anything to the contrary since then, please speak now.

That just leaves me to thank God for Evolution. I want you to know that I’m with You every step of the way. Ceteris Paribus.

WTF is GOP?

Hello again,

I promise you I’ll change the record soon. I think that everything useful that can be said about rate parity has been said already and it’s now time to let the competition bureaus decide its fate.

I’m only adding this post as a bookmark to look back on when everything is resolved as a reminder of just how insane this whole business got.

The attachment is a PDF of a power-point presentation given by some industry consultant (also a business graduate and surfer but certainly not a ‘dude’) at a conference last year. I found it on Google.

Wilhelm has a real good time

If there’s anything more tedious than consultants it’s power-point presentations but fortunately we don’t have to listen to this one and it’s quite fun adding your own voice-over. The presenter has also aided us by casting me as Stan from Southpark (mysteriously, he’s characterised his clients as the hapless Kenny who gets gratuitously killed at the end of every episode) along with other colourful annotations and typos.

It’s far too long – these things always are – so skip to page 33 where Wilhelm asks the now catatonic audience whether or not it’s okay to fix prices. I know we know the answer to that already but maybe Willie skipped that lesson in his degree.

If you haven’t got time to read it, here’s the spoiler: rate parity assists hotels raise GOP by 4%.

So, there you have it – if you’re anxious about your falling GOP levels you now know how to fix them. You simply flout competition law and fix prices between you. I’ve just saved you 4 years in business school plus an hour of intense boredom. I should have been a consultant.

Dorian

Rate Parity: A Story with Legs

Soon after I started my campaign against rate parity, which my school friend and industry colleague Pete calls my cause célèbre (I prefer ‘obsession du jour’ but we were both in bottom set French so don’t quote either of us) I realised that ‘resale price maintenance’, the correct terminology, just wasn’t attractive so I switched over to the sexier and more media friendly ‘price fixing’.

That certainly got the attention of the press but riled some people in the hotel industry and sparked some direct personal confrontations. An industry ‘expert’ Tweeted me (directly, not publicly) to say: feel sorry for you that you have to bother the whole world with your companies challenges… never seen such a paranoid person in my life…

You could argue that his inclusion of so many full stops was rather decadent in the world of the micro blog but it did make it all the more engaging I felt. It also made me wonder what he would have written if he’d had more than 140 characters in his arsenal. Perhaps he would have taken me out with some well aimed bullet points.

In the meantime I’ve been getting a lot of support for my paranoid campaign. The Telegraph picked up on the fact that the Office of Fair Trading had raised the stakes to an ‘administrative priority’ (those are stark words in official circles) and sent a top journalist, Holly Watt, to interview me.

I looked Holly up before she visited and saw that she’s a rising star in the world of journalism not least of all because of her involvement in the expose of the MPs’ expense claims. So I knew the Telegraph saw something big in this story.

Holly was hungover on the day yet surprisingly sharp and she finished most of my sentences for me. I liked that. I can’t exactly remember what we discussed but I sent her a barrage of emails following up on the meeting asking her to pitch the story as a changing competition law per se or something equally esoteric. She ignored me I’m pleased to say.

That story does exist but it’s best kept to the Global Competition Review or some such nerdy publication (I hope that didn’t cost me my free subscription!) and Holly went instead with the consumer angle. Again, I can’t remember the details but it was front page news with the headline ‘Hotels face enquiry in price-fixing scandal’. By the time I’d bought my copy at 7am there were already more than 180 irate comments on the Telegraph’s website opening up the discussion which is as much as I could have ever hoped for. I don’t know how these things work but I hope Holly gets a bonus for her efforts. Or at least some Aspirin.

The Daily Mail also picked up on the story from the Telegraph and it went from there across the Web. It mutated somewhat and the story became that three hotel chains in particular were being investigated by the O.F.T. That was sloppy journalism but it did reveal some interesting sentiments from the chains themselves. Most notable was Radisson Edwardian which put out the following public statement:

“We are not involved in any collusion with any organization to set a price on room rates for any of our hotels and go to great lengths to ensure that there consistency across all booking channels for our clients.”

How they didn’t realise that they’d just spelt out the dictionary definition of anti-competitive behaviour I do not know. But they’re not alone and there exists a strident defence of rate parity in some quarters. And not just from nitwits I must say. Some people have forwarded reasonably erudite if flawed arguments.

Oh, and the BBC came for a television interview. It turns out their producers can’t get enough of my pensive look. I confess I’ve been practising it more or less daily since I was last on the telly and I think I’ve pretty much nailed it. I got the chance to show it off with Brighton’s seafront and the old pier as my backdrop. And I tucked my shirt in this time. Mum would have been proud.

Media-wise the story seems to have taken on a life of its own and I no longer have to contact the press. If I’d been really savvy I would have arranged a fly on the wall documentary of the whole thing. You’d have got to see Gina wading through her fifth bowl of chocolate covered Cheerios at her desk and the Mark’s failed attempts to grow the office Bonsai. It’s really that exciting at Skoosh HQ. Next time.

The case goes on.

If David and Goliath had started socialising

Pete, my friend and colleague at Skoosh, always complains that I don’t start my blog posts with something of a summary of what I’m about to say. You know the old rule – say what you’re going to say, say it and then say what you said. I’ve taken that on board so in deference to Pete and all the other Pete’s out there, here’s what this one is about:

It’s about talking with people, not down to them.

The internet, specifically the ecommerce side of it, has been around for 15 years or so now. It’s as exciting as Hell and yet strangely stagnant. We were promised a revolution when we moved across to Web 2.0 but that didn’t happen and for good reason I believe. The clue was in the name. Web 2.0 was a marketing term and as long as we think in terms of marketing we’re stuck in Web 1.0.

For those of you not in marketing, Web 2.0 is this. It is the transition by ecommerce sites – online shops – from talking at you to talking with you. Decades of advertising on top of centuries of education have made us comfortable with being told what to do. ‘Click here’, ‘Eat This’. It’s a veritable Alice in Wonderland just without the magic.

The magic does exist online though. Social networking sites have it, even patriarchal corporations like Facebook. Here you can see photos of your friend’s very ill thought out fancy dress costume they wore at a party you didn’t manage to get to. And you can tell other people about it. As people, rather than consumers, that’s what we like to do.

Facebook is different of course. There are no customers. Ditto Twitter. It’s just us talking to us. To translate that sort of communication to commercial websites we need to make a big shift in our thinking away from what can we tell our customers and towards what we can chat to our friends about. In other words businesses need to start thinking like friends rather than marketing execs. They need to start socialising.

‘Like’ on Facebook was very clever in that sense. At a glance it could be an instruction but it’s ambiguous and is more likely, in connection to a social networking site, to be a question to yourself – ‘Do I like this’? whereas the language of ecommerce is still typically full of instructions. ‘Book now’!’.

Expedia (I’m not picking on a competitor – their site is more influential than Skoosh) has a spider trail leading to their Las Vegas Deals section as follows:

Expedia.com > Deals and Offers > Six Deals we Love > Las Vegas

Okay, it’s no hard sell and with ‘Love’ they’ve certainly bought into the language of the age of sharing. But it’s still coming from them. It starts with ‘Expedia.com’, not even just ‘Expedia’. It’s their store. ‘Deals and Offers’ is fair enough if a bit dull and prosaic (I’m not having a go at them, their site is important in this industry, did I mention that before?). The questionable bit is ‘six deals we love’. Again, as if you weren’t quite sure, you’re back in their store. Someone working at Expedia has found me six deals I’m going to love. I don’t think so. I wasn’t even planning to go to Vegas.

This looks very different when it comes from a friend. Someone whose values I share is inviting me to stay in a villa in Portugal. Interesting – what a great place to catch up and I haven’t been to Portugal for years. Count me in.

Expedia isn’t your friend (I’m not saying anything) so how are they going to sell you a villa in Portugal in anything like the same way? Well, what they’ll do is start thinking like your friend. Your friend hasn’t recommended anything to you this time but you can them. So, on Expedia, you put together 6 great looking deals and post them on your Facebook page: ‘6 deals I love’. It doesn’t even have to be so gushing, the point is that your friends (let’s say mine) are going to say ‘Blimey, Dorian’s bothered putting together 6 amazing travel deals, I’ve got to see this’. They then click through to Expedia and see ‘6 deals chosen by Dorian’. Five friends ‘Like’ the pastel yellow house overlooking Lake Como. That’s where I’ll be staying.

This sort of thing isn’t offered by the commercial Goliaths. The big companies in the travel industry have lacked innovation and there’s precious little brand engagement to be seen. Sure, Expedia has a huge market but it is supported by immense advertising. I don’t think I’ve ever heard any one say I only go to Expedia. But why not? They sell everything and they guarantee the best prices. In reality, there’s no point to going price comparison sites to get to Expedia but people still do because Expedia doesn’t let you talk. Less so Ebookers, Opodo and Travelocity. They’re all about talking at you.

The reality behind Web 2.0 is that people engage in sites not necessarily because they identify with the companies behind them but because when they’re on there they can do the things they want to do and one thing they always like doing – one this we always like doing – is talking to each other. If you give them the opportunity to talk about your online store with their friends they will.

Better, Pete?