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With earnings season upon us, it was difficult to limit this week’s Update to just 12 stories. For those of you seeking a deeper dive into the latest on online booking platforms, Expedia Group and Booking Holdings I encourage you to take a look at the Expedia Group and Booking Holdings call transcripts. Enjoy. 

Expedia Updates
(“Expedia Unveils New Strategy,” May 6, 2022 via Hotel Business)
(“Expedia Group Revenue Jumps 81 Percent as Travel Recovery Continues,” May 2, 2022 via Phocus Wire)
(“Expedia Group Revamps Marketplace, Tech Platform as Part of New Strategy,” May 4, 2022 via Phocus Wire)

Last week not only saw the release of Expedia’s first quarter earnings report, but also the hosting of Expedia’s annual partner conference – this year titled Explore. Here are my key takeaways from this past quarter’s earnings release and reported Explore highlights:

    • While Expedia’s quarterly financial performance still lagged behind 2019, recent months (starting with February) have exceeded same month comparisons to 2019.

    • Traveler demand is returning stronger than ever, despite the emergence of COVID variants, the war in Ukraine, inflation, etc. In CEO Peter Kern’s words, the recovery “seems too strong to be held down.” Demand is also starting to return across multiple segments, including CBD business and business travel.

    • VRBO continues to enjoy unprecedented success, performing now at levels above 2019. Supply constraints remain a concern, particularly in key markets.

    • Expedia’s B2B business (most notably, Optimized Distribution) continues to gain traction (particularly with the recent enrollment of IHG) and is now a major focal point for Expedia’s future growth. Expect increased interest in enrolling supplier partners of all sizes in Expedia’s B2B program.

    • When discussing Expedia’s latest quarterly marketing investments, Peter referred repeatedly to efforts now focused on developing longer term relationships with its travelers and the “lifetime value” of such travelers. According to Peter, “the industry has been very transactionally focused and we haven’t been great historically at measuring lifetime value...” Sound familiar? Sounds like Peter may have stolen a page or two from hoteliers’ song books on the real value of direct channel bookings (and their associated investments) versus the “transactional” bookings often sourced through third party online channels.

    • At last week’s Explore event, Expedia launched its new technology platform, Expedia Group Open World. This new platform will allow partners of all shapes and sizes to contribute products, services and content to the overall traveler experience.  Expedia also revealed its new reimagined marketplace, which, among other things, will now rank individual hotels (which ranking then affects display and sort order) by a new guest experience score – which takes into consideration guest reviews, customer service interactions, etc. And in a nod to Hopper and its incredible success these past few years, Expedia is also launching a price predictive tool that will allow users to track historical and anticipated future rate changes for both air (today) and hotel rooms (later this year).

This week’s Update includes two stories detailed Booking Holdings’ recent earnings release and a surprise story regarding Google’s hotel booking platform. Enjoy.

Google Shutters Book on Google
(“Book on Google for hotels to shut after low take-up,” February 25, 2022 via Phocus Wire)
Citing low usage by both suppliers and users, last week, Google announced that it was shutting down its “Book on Google” feature on May 25. The facilitated meta search platform (my phrase) allowed users to begin the booking process on Google (reservations and payment details) and then complete the booking on the supplier’s (hotelier or OTA) website. The announced changes should have no effect on Google’s hotel search products, including the free booking links implemented last year.

This week’s Update leads with an important Data Privacy Update from Eva Novick, the newest member of our firm’s privacy and data security team. If you currently operate a loyalty program (or plan to introduce one soon), I encourage you to read her important update. Enjoy.

The Travel Industry’s Push on Climate May Have Legs
(“Hotelbeds lays out eco and social initiatives, joins Amazon Climate Pledge,” February 11, 2022 via Phocus Wire)
For some time now, we’ve all seen the many surveys of would be travelers (particularly, younger travelers) detailing the importance of the environment and climate change in today’s travel decisions. Our weekly Update has recently featured a number of stories about this trend, including the recent launch of online platforms offering travelers carbon neutral travel. Last week, Spain-based bedbank, Hotelbeds, released its annual Environmental, Social and Government Report in which Hotelbeds claims it has again (for the fourth year running) attained carbon neutral status  through a combination of carbon reductions and offsets. At the same time, Hotelbeds also announced that it has joined Amazon’s Climate Pledge, which features companies committed to eliminating their carbon emissions to zero by 2040. So what does this really mean? Will efforts like these mean enough to travelers to actually drive bookings or market share? With Hotelbeds feeling the heat from increased competition in its wholesale space (think Expedia EPS and soon, Priceline’s equivalent offering), Hotelbeds is “banking” on it.

This week’s Update features stories on Kayak, Hopper (again) and Shiji, and includes an important privacy update from California on loyalty programs.

Kayak and Cruise Critic Partner on Cruises
(“In new partnership, Kayak cruise searches will feed Cruise Critic,” February 4, 2022 via Travel Weekly)
Last week, Kayak (Booking Holdings) announced that it was expanding its cruise offering by partnering with Cruise Critic (TripAdvisor). Once implemented, the partnership will redirect users searching for cruises on Kayak to Cruise Critic where they can then review and book cruises through travel agencies or cruise suppliers.

This week’s Update features several stories on the big online travel newsmakers of last week – Google and Kayak. Enjoy.

Google Once Again Embraces Organic Search and Eliminates Hotel Listing FeesGoogle
(“Tripadvisor’s New Subscription Service Edges the Company Toward Online Travel Agency Status,” March 7, 2021 via Skift Travel News) (subscription may be required)
(“Google eliminates fees for hotel booking links”, March 8, 2021 via Phocus Wire)
(“Google Drops Costs for Hotels and Resellers to List Rates in Price-Comparison Search”, March 8, 2021 via Skift Travel News) (subscription may be reqired)
(“VIDEO: What Google's overhaul of hotel booking ads really means”, March 9, 2021 via Phocus Wire)
Was it a response to Tripadvisor’s recently announced roll out of its “free” subscription program, Tripadvisor Plus? Perhaps it was a response to the many antitrust claims filed against Google late last year by the U.S. Department of Justice and state attorneys general. Or is it simply Google’s next step toward total world domination (or at least domination of hotel metasearch)? Regardless of the reasons behind its change, Google’s recent announcement came as a surprise to many. While the industry continues to analyze the significance of the change (see our multiple stories linked above), here’s what we know: Google is adding two new organic slots/links (underneath four paid slots) to users’ search results when they search for accommodations in a particular location. The two new slots will be available to participating hotels, online travel agents or other booking sites without charge. According to Google, the ranking of these free slots will be based on an algorithm that considers price, click-through rates and the landing page experience, but not on any existing commercial relationship with or payment to Google. The links themselves will continue to be provided via feeds from partners, including hotels, online travel agents and integration partners. Who said search engine optimization (SEO) was dead?

This week’s Update features stories on Google’s recently announced online third-party tracking changes, the (permanent) nature of virtual experiences, growth of “digital” kitchens and important updates on what group events may look like post pandemic. For those of you who missed our mid-week update on Tripadvisor’s troubling plans for obtaining discount rates for its Tripadvisor Plus subscription service, we’ve also included that story again. Enjoy.

Are Virtual Experiences Here to Stay?Amazon
(“Why virtual tours and activities will stick around after the pandemic,” March 4, 2021 via Phocus Wire)
One small Seattle-based company seems to think so. Even months before the pandemic began, Amazon was working on its virtual experiences offering. With the launch of Amazon Explore in September, Amazon joined Airbnb, Viator and Klook in offering “risk-free” virtual experiences and activities. Now with the pandemic’s end in sight, members of the travel industry are asking whether these travel alternatives will remain relevant. Amazon and other experience platforms believe that these offerings will continue to be used as both an alternative to travel and as a compliment to travel (think Rick Steves). Actual suppliers of the virtual experiences report mixed results, though most recognize they may play an important sales and marketing function in the future. What will be most interesting to watch in our post-pandemic world is whether lessons learned (and the supplier connections made) by Amazon while offering virtual experiences will lead the behemoth e-commerce platform to transition to actual experiences and activities.

This week’s Update takes a close look at Booking Holdings’ recent fourth quarter and year-end earnings release. Enjoy.

Booking Holdings’ Financial ResultsBooking Holdings
(“Booking Holdings focuses on payment platform, connected trip and U.S. growth as 2020 revenue drops 55%,” February 24, 2021 via Phocus Wire)
(“Booking Holdings, Inc.'s (BKNG) CEO Glenn Fogel onQ4 2020 Results - Earnings Call Transcript,” February 24, 2021 via Seeking Alpha)
(“Booking Holdings Reports Financial Results for 4th Quarter and Full-Year 2020,” February 24, 2021 via Booking Holdings)

Booking Holdings (including brands such as Booking.com, Priceline, Agoda, Kayak, RentalCars.com and Open Table) released its fourth quarter and full-year 2020 financial results last week.

Highlights from the release include the following:

    • Gross bookings dropped 63 percent in 2020 to $35.4 billion
    • Total revenues dropped 55 percent in 2020 to $6.8 billion
    • Room nights booked dropped 58 percent in 2020
    • Adjusted EBITDA dropped 85 percent in 2020, though even with this drastic drop, Booking Holdings remained profitable on an adjusted EBITDA basis in 2020 ($880 million)
    • Marketing expenses in 2020 dropped sharply to $2.2 billion (down from $5 billion in 2019)
    • Company staff were cut by approximately 23 percent, resulting in approximately $330 million in personal expense savings (no additional cuts are currently anticipated)

For readers who have been following our Online Travel Updates since its inception, we thank you for your continued support. In this year of 2021, June will mark our six-year anniversary of publishing these weekly updates dedicated to keeping our readers up-to-date with legal, regulatory, and market and industry trends related to the online travel space. We hope you continue to find them informative and helpful as the online travel industry keeps evolving.

This week’s Update includes several stories spotlighting a few Expedia Group companies – Expedia, Trivago and Vrbo. We’ve also included another story on the so-called “digital health passports.” Whether you agree with their use or not, we suspect the passports will be part of travel (and life) for the foreseeable future. Over the past several weeks, we’ve spent a lot of time with clients considering the role of COVID-19 testing, the pros and cons of offering testing to guests as an onsite amenity, and how best to leverage the test results (and soon vaccination records) via the many available digital health passports. This is one part of our practice that we would have never anticipated delving into just 14 months ago. Enjoy.

Unlike our short Update last week, this week’s edition is filled with several important stories.

Have a Unique Cancellation Policy? Not AnymoreBooking.com
(“Booking.com changes hotel cancellation and deposit policies,” February 5, 2021 via Hotel Owner) (subscription may be required)
Last week, Booking.com announced plans to limit the number and types of cancellation, and advance deposit policies that its platform will support. The change takes effect on April 6, 2021. This is not the first time Booking.com has announced its own approach to cancellations regardless of the policies maintained by its hotel supplier partners.

As evidenced by our list of stories below, it was a relatively quiet week for online travel.

Tripadvisor Introduces Virtual Voice Tours for Amazon AlexaTripAdvisor
(“Tripadvisor creates virtual destination tour via Amazon Alexa,” January 29, 2021 via Phocus Wire)
Working with tourism authorities in Abu Dhabi, last week, Tripadvisor launched what it claims to be the first virtual destination voice tour for Amazon Alexa. Users in the United Kingdom can summon the voice tour by asking their Alexa-enabled device “to explore Abu Dhabi.” The voice tour is part of a larger campaign between Abu Dhabi and the review/distribution platform and, according to Tripadvisor, the feature will be made to other destination partners.

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Greg Duff
Editor
Greg Duff founded and chairs Foster Garvey’s national Hospitality, Travel & Tourism group. His practice largely focuses on operations-oriented matters faced by hospitality industry members, including sales and marketing, distribution and e-commerce, procurement and technology. Greg also serves as counsel and legal advisor to many of the hospitality industry’s associations and trade groups, including AH&LA, HFTP and HSMAI.

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