It was just over two months ago that Kayak and Priceline sent ripples through the online travel industry with a blockbuster deal in which Priceline shelled out a whopping $1.8 billion to acquire the recently-public travel search engine. Kayak was able to claim such a hefty premium for a simple reason: By indexing a laundry list of travel sites and airlines to help everyday travelers find the best prices for flights, rental cars, hotels and cruises, it has made process of booking online travel far less painful.
After a challenging road to its public offering, the company was able to hit its stride by focusing on product. The launch of its own booking path enabled users to book flights directly without leaving the Kayak platform, improving the user experience, while the addition of tools that help users get the most out of the service beyond booking, like Trip Management and its expansion of its hotel booking business, for example, added depth to its product.
Its blockbuster acquisition complete, its seems that Kayak is returning its focus to improving its flagship product: Flight search. Back in November, the company published “When To Book” guidelines that were based on its analysis of over one billion search queries across its products. Based on positive feedback from its hardcore, deal-hunting faithful, Kayak today added price forecasts to its flight search results.
While Kayak users have long had access to a fare history chart, the addition of its forecasting tool means that all Kayak search results now include a forecast of whether the prices in your search are going to rise or fall within the next week.
KAYAK’s Chief Scientist Giorgos Zacharia, who led the development of the company’s new price forecasting tool, tells us that the algorithm includes data from a wide range of faring and availability providers across the billion-plus annual queries made across the company’s websites and mobile apps. And, as with Kayak’s search engine itself, the more the company collects data and tests the algorithm, the more it expects the accuracy of its forecasting tool to improve, Zacharia said.
In addition, he says, the forecast tool also uses historical data and year-over-yaer trends when deciphering whether to buy now or wait. That information coupled with Kayak’s proprietary technology allows the forecast tool to come to a specific buy or wait conclusion. While the tool does not display individual data sources, it is based on data from multiple providers across over one billion annual queries — a much larger data set than any of Kayak’s competitors currently offer.
Its forecasts are also available on a much larger number of routes that’s not a set list of origins and destinations, so there’s some variance, but over time will increase coverage. “At launch, the tool will show forecasts on more than 6,000 routes (origin and destination pairs), which is more than double what we’ve observed on Bing,” the Chief Scientist tells us.
The tool also offers a number or percentage of statistical accuracy within each forecast, allowing users to see how confident Kayak is that its estimate is correct and will rise or stay within $20 of the current price, for example.
The company, as always, recommends that, when in doubt, users should book now rather than wait. From its previous studies, Kayak found that the optimal time to book in advance is 21 days, while travelers planning a weeklong trip should depart on a Saturday and return on Monday to score the cheapest fare. More in Kayak’s guidelines here.
While the new forecasting tool takes into account mobile queries, it is not currently available on Kayak’s mobile apps and is instead available for use on Kayak.com in the U.S. and U.K.