Jul 25, 2005 (01:07 PM EDT)
Travel Sites Rate Poorly In Protecting Customer Privacy

Read the Original Article at InformationWeek

More large airlines and travel firms are sharing customer data with other companies without permission or have unclear privacy policies than six months ago, a research firm said Monday.

In analyzing 41 of the largest online travel companies in six categories, 38 percent in the current quarter failed in the way they handled customer privacy, The Customer Respect Group found. That compared to about 26 percent in the first quarter of the year.

Most industries have shown a decrease in the sharing of customer data with third parties, but the travel industry has bucked the trend because of the many co-marketing deals in which an airline, for example, will offer hotel reservations and car rentals, along with plane tickets.

"The industry has a lot of synergistic sharing arrangements, so (data sharing) tends to be a little more prevalent," Terry Golesworthy, president of the CRG said. "

Nevertheless, sharing data without permission is a practice consumers dislike the most, Golesworthy said. In addition, the practice can lead to consumers receiving more travel-related spam.

Despite this negative trend, the travel industry improved in its overall treatment of online customers, scoring a 7.2 Customer Respect Index, compared with a 6.8 in the beginning of the first quarter, the CRG, based in Ipswich, Mass., said. Nine travel-related sites received CRIs of 8.0 or above, which is considered an "excellent" rating in the biannual analysis. None of those companies share customer data without permission.

The reason for the improvement in treating online customers is a major effort by airlines to win back customers who have been buying tickets from web-based resellers, such as Expedia or Travelocity.

"They're desperately trying to take back the business by offering services that are similar to ones available through resellers," Golesworthy said. "The web-based resellers have taught traditional travel-related companies quite a lesson."

Traditional companies, for example, have become more responsive to email inquiries, Golesworthy said.

The companies that had the five highest CRIs were Marriott International, 8.4; Alaska Air Group Inc., 8.3; Enterprise Car Rental, InterContinental Hotels Group, and Northwest Airlines Corp., all 8.2; Travelocity and US Airways Group, 8.1; and Avis and Orbitz, 8.0.

The bottom five companies were Hotels.com, 6.1; United Airlines, 5.9; Starwood Hotels and Resorts Worldwide Inc., 5.8; Southwest Airlines, 5.6 and Norwegian Cruise Line, 5.1.

By category, the overall CRIs were car rental companies, 7.6; web-based resellers 7.3; hotels, 7.1; airlines, 7.0; and cruise lines 6.7.