Hotel Online
News for the Hospitality Executive

Travelocity Launches $80 million Ad Campaign;
Hopes to Regain Market Share Lost to Expedia
By Andrea Ahles, Fort Worth Star-Telegram, Texas
Knight Ridder/Tribune Business News 

Jan. 6, 2004 - SOUTHLAKE, Texas -- Travelocity is pinning hopes for growth on an $80 million gnome. 

The Southlake-based online travel site launched ads featuring a "Roaming Gnome" on Monday, the most expensive campaign in the company's history. 

The television, radio and newspaper ads feature a two-foot, white-bearded gnome with a red hat and blue coat that has been stolen from its owner's garden. In the ads, the gnome is shown skiing, cliff diving in Mexico, and eating cheese in Canada. 

"We're really looking at this campaign to relaunch the Travelocity brand," said Susan McLaughlin, vice president of marketing at Travelocity. 

Travelocity has struggled the past two years as it lost market share to industry leader Expedia and faced increasing competition from third-place Orbitz. 

Expedia spent $95 million on media in 2002, compared to $70 million for Orbitz and $59 million for Travelocity, according to TNS Media Intelligence//CMR. 

To attract new business, the company spent most of last year investing in new products, such as its merchant hotel program and business travel section. The Web site also got a face-lift so Travelocity could promote its customized vacation packages. And Travelocity named a new chief executive, Michelle Peluso, in December. 

Travelocity said it expects to run the ads for at least one year. 

While $80 million is the most Travelocity has ever spent on an ad campaign, many advertisers spend 10 times as much. General Motors spent $1.27 billion in the first six months of 2003 on its ads alone, and AOL Time Warner spent $965 million in the same period. 

The gnome ad campaign was generated by Travelocity's new advertising firm, McKinney + Silver. Travelocity hired the Raleigh, N.C.-based firm in October to create new marketing ideas. McLaughlin said the gnome idea was one of McKinney + Silver's proposals when the agency bid for Travelocity's ad contract. 

Although ads featuring the gnome and the line "Book with Travelocity: Don't Forget your Hat," did not hit the airwaves and newsstands until Monday, the company spent several weeks creating buzz about the gnome on the Internet. 

Travelocity created a Web site,, with the gnome's owner, Bill, posting gnome sightings. The gnome was also featured in a mock news report shown during the Rose Bowl football game Jan. 1. 

McLaughlin said the gnome campaign was based on the European tradition of gnome kidnappings where people steal garden gnomes and send back ransom notes to their owners showing the gnomes traveling all over the world. 

-----To see more of the Fort Worth Star-Telegram, or to subscribe to the newspaper, go to 

(c) 2004, Fort Worth Star-Telegram, Texas. Distributed by Knight Ridder/Tribune Business News. TSG, IACI, ORBZ, TWX, GM, 


To search Hotel Online data base of News and Trends Go to Hotel.OnlineSearch
Home | Welcome| Hospitality News | Classifieds| Catalogs& Pricing |
Viewpoint Forum | Ideas&Trends | Press Releases
Please contact Hotel.Onlinewith your comments and suggestions.