Get onboard for summer travelCapture the UK traveller through search advertising

Microsoft Confidential

Travel allows us to recharge from our everyday busy lives.

For some of us it’s also an opportunity to test our own understandings and be wonderfully curious.

Online travel planning is a global trend

Source: visual.ly, September 2013.

8 in 10Travellers plan theirtrips online

Online travel sales by region:

Digital travel sales is a growing trendMintel1 forecasts steady year-on-year growth for UK holiday sales over the next 5 years

1. Source: Mintel Annual UK Holiday Review 2014, as reported by Travel Weekly: http://bit.ly/1f8fkFG

New competitors like Kayak, Skyscanner, and Momondo are entering the holiday package market.

Overseas market is growing steadily with a predicted 41 million overseas holidays by 2018, up from 36 million in 20131.

Trend towards spending more on holidays

eMarketer forecasts digital travel sales to grow 12.3% in 20141

Sources: 1 http://www.emarketer.com/Article/Digital-Travel-Sales-Mature-Worldwide/10105771

2 Mintel Annual UK Holiday Review 2014, as reported by Travel Weekly: http://bit.ly/1f8fkFG

Travellers are spending more on individual holidays and are booking multiple holidays.2

47% spent £1,000 and 19% spent £2,000 on their last packaged holiday.2

It’s about that time. Summer travel clicks ramp up strongly from May

Source: Internal analysis based on performance of paid clicks on top Travel queries across the Yahoo Bing Network in the UK

Clicks volume peak by up to 50% during July and August

Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-1360%

70%

80%

90%

100%

110%

120%

130%

140%

150%

160%

Travel - All Car hire Cruises Flights Holidays / Travel Agents Lodging

Click volume for travel trending on the Yahoo Bing NetworkClick volume relative to March 2013, UK

Interest in city break destinations is on the rise

5 out of the top 10* flight searches on Yahoo Bing Network are city break destinations. (February 2014, UK)

* Source: Internal analysis based on search volume and destination of top 50 flight queries with a specified destination on Yahoo and Bing UK sites. Note: Domestic mainland flights excluded

#1 New York

#4 Malaga

#5 Amsterdam

#7 Dublin

#9 Barcelona2 of 3 new entries in 2014 are city break destinations

Bing Ads mobileAlmost 9 in 10 research and plan their holidays on their mobile

Source: http://news.weve.com/news/resources/infographic-the-growing-role-of-mobile-in-booking-holidays/. Weve survey of 1,550 UK smartphone owners, Nov 2013.

44% compare prices

and holiday packages

45% search flights and hotels on their mobile

phone

28% book flights

33% book hotels

Source: http://news.weve.com/news/resources/infographic-the-growing-role-of-mobile-in-booking-holidays/. Weve survey of 1,550 UK smartphone owners, Nov 2013.

Almost 9 in 10 people now research and plan holidays on their mobile

Mobile search optimisation is key

62% use search engines to inspire their

holiday plans

3 out of 10 travel searches come from mobile

Source: Internal analysis based on performance of top Travel queries across the Yahoo Bing Network in the UK

Share of searches by device in Travel on the Yahoo Bing NetworkFebruary 2014, UK

Travel - All Lodging Holidays / Travel Agents

Cruises Flights Car hire0%

5%

10%

15%

20%

25%

30%

35%

40%

20%

28%

14%12% 10% 10%

8%

7%

10%9%

8%6%

Tablet

Smartphone

Engagement with travel ads on mobile ads equals or exceeds desktop

Smartphone Cost Per Clicks (CPC) are 15% lower than desktop in the travel sector

Travel - All Lodging Holidays / Travel Agents

Cruises Flights Car hire0%

50%

100%

150%

200%

250%

Desktop Smartphone Tablet

Click thru rates (CTR) indexed for February 2014, UK Travel Queries

Source: Internal analysis based on performance of top Travel queries across the Yahoo Bing Network in the UK

Source:1. xAd/Telemetrics Mobile Path to Purchase Study (Apr 2013) – UK edition

Most important mobile features for travel (top rank)

Optimized mobile site Good online reviews Being listed in top results Access to maps/driving directions

Smartphone

Tablet

40% 36

%

19%

28%

10%

11% 10

% 7%

Optimised mobile sites a key priority for Travel searchers

Ad extensions connect you to your travel customers, with strong performance

Location Extensions

Sitelink Extensions

Call Extensions Merchant Ratings

Ad extensions can also be combined to drive further engagement

• Increase click-through rate (CTR) and conversions.

• Provide direct access to relevant site content and a richer experiences

• Shorten the conversion funnel and improve profitability.

Source: Microsoft internal data, May 2013. Performance study based upon beta testing data on Bing O&O only and is not a guarantee of performance. Increase in clicks is dependent upon a seasonality and advertiser vehicle.

Sitelink Extensions are driving significant click-through rate uplift

Immediate actions in real-time and on-the-go…

22%Higher click-through rates for UK travel advertisers

60%of clicks from UK travel queries come from ads with Sitelink Extensions

Combining extensions can results in improved click-through rates

20%

Text Ads with

Sitelinks

Text Ads with

Sitelinks &

Location Extension

s

7%

Text Ads

Source: Internal Microsoft Analysis. 1 Oct - 20-Nov, 2013 Bing and Yahoo O&O, UK PC and tablet only. Data represents the average mainline CTR performance for all advertisers adopting the ad extension(s).

• Average CTR of a text ad with Ad Extensions is higher than that of a standard text ad without extensions.

• Average CTR is higher when advertisers leverage a combination of Ad extensions.

14%

Help your search ads take flightwith ad copy best practices

Airlines and flights:

Top word combos

PC Mobile Tablet

Title Description

City Official/Official Site

Tickets Official/Official Site

City Find

Travel Flights

Tickets Find

Title Description

Find Today

Find City

Book Flights

Flights Airlines

City Lowest

Title Description

Deals Travel

Deals Find

City Travel

Travel Flights

Fares Air

Key insights

- The word “find” in the ad description ranks high when used with almost any travel-related words in the ad title, from “airfares” to “[city name]” to “deals”.

- PC users are much more interested in ads that include “official site” than either mobile or tablet users, which is indicative of the different intent depending on device. PC users have a bigger screen and are more willing to navigate a large, official site. Mobile users go directly to action, clicking on ads that include “book” and “flights”.

Source: Internal analysis based on quality of ads that served on top travel queries between Jun-Jul 2013 in the UK

Here’s how to read a heat map

Our study results show that a travel ad with “airlines” in the title and “deals” in the description has high Ad Quality.

Ad description

Ad t

itle

Great Good Insufficient dataPoor

Air Airfares

Airline Brand

Airlines

Book

Call to Action

City Deals

Destinations

Discount

Fares Find Flights

Fly

Guaranteed

Huge/Big

Lowest

Nonstop

Now

Offers

Official Site

Online

Prices

Save Tickets

Today

Trademark

Travel

Website

Your

Air

Airfares

Airline Brand

Airlines

Area

Book

Call to Action

City

Deals

Discount

Fares

Find

Flights

Fly

Lowest

Nonstop

Official Site

Online

Save

Tickets

Trademark

Travel

Website

Our study results show that a travel ad with “airlines” in the title and “deals” in the description has high Ad Quality.

Flights:Ad performance heat map

Ad description

Ad t

itle

Source: Internal analysis based on quality of ads that served on top travel queries between Jun-Jul 2013 in the UK

Very Good Good Insufficient dataAverage-PoorTop combination

Lodging:Ad performance heat map

Ad description

Ad t

itle

Very Good Good Insufficient dataAverage-PoorTop combination

Source: Internal analysis based on quality of ads that served on top travel queries between Jun-Jul 2013 in the UK

Co

py

rig

ht

/ T

rad

em

ark

sig

n

Holidays:Ad performance heat map

Ad description

Ad t

itle

Source: Internal analysis based on quality of ads that served on top travel queries between Jun-Jul 2013 in the UK

Co

py

rig

ht

/ T

rad

em

ark

sig

n

Very Good Good Insufficient dataAverage-PoorTop combination

© 2013 Microsoft Corporation. All rights reserved. Microsoft, Windows, and other product names are or may be registered trademarks and/or trademarks in the U.S. and/or other countries.The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.