3 years ago
 

Hipmunk dismisses Google, Kayak and profits as launch anniversary approaches

With the prospect of Google soon launching a flight-search product, Hipmunk is expressing its immunity from competitive swirls.

And, fellow travel-metasearch engine Kayak, too, is getting chatty.

And, as Hipmunk approaches its first anniversary Aug. 17, cofounder and CEO Adam Goldstein says Hipmunk “is not particularly worried” about the competitive threat from Google with ITA Software in the fold.

“Generally speaking, they [Google] are not fantastic at the user experience,” Goldstein says, adding that it is unlikely that Google would exclusively present its own flight-search results “because of fear of the government.”

Hipmunk doesn’t rely on Google for traffic and most people coming to Hipmunk.com from Google have searched for “Hipmunk” and not for flights, Goldstein says.

“We would not lose sleep if we lost it,” Goldstein says, referring to referrals from Google.

In that regard, Kayak faces more of a threat from Google than Hipmunk does because Kayak is more dependent on Google traffic, Goldstein maintains, without revealing any specifics.

Kayak has publicly disclosed that bidding on keywords in search engines and “traffic-generating arrangements” in travel search engines accounted for about 5% and 10%, respectively, of its user queries in the first quarter of 2011.

With a team that includes Goldstein, co-founder and chief technology officer Steve Huffman, three web developers , two mobile developers and others, Goldstein won’t provide specifics on the company’s performance other than to say Hipmunk attracts “hundreds of thousands” of monthly unique visitors and “millions of dollars in gross bookings.”

[At launch time last year, the newborn Hipmunk was featured in a TLabs Showcase.]

The dollars flowing into Hipmunk  today likely are a pittance compared with those of six-year-old Kayak, which recorded $170 .7 million in revenue in 2010.

Under that microscope, some would challenge the relevancy of Hipmunk even being in the same conversation with Kayak.

Hipmunk intends on focusing on scale and the user experience rather than profitability at this juncture, Goldstein says, although international expansion is not in the short-term pipeline.

Goldstein says Hipmunk has a different focus than Kayak, which, in his view, has its eyes on the user experience “to some extent,” but is preoccupied with monetization and advertising.

Hipmunk, with its Agony filter for flights and Ecstacy sorting of hotel results, “solely” focuses on the user experience, Goldstein contends.

And, with no plans in the immediate future to run aadvertisements on its site, Hipmunk “is doing fine on commissions,” he adds.

In contrast, Goldstein argues that Kayak would be even more focused on monetization — to the detriment of the user experience — if it executes an IPO and becomes a public company.

Speaking of monetization, Goldstein says it is his “intuition” that Hipmunk has a better conversion ratio of lookers to referrals than Kayak’s because of Hipmunk’s ad-free path.

But, Goldstein concedes that Kayak likely has more direct-connects with airlines, which could assist Kayak’s conversion numbers.

Kayak declines to engage in a back-and-forth with Hipmunk.

Meanwhile, some travel industry wags have criticized Hipmunk during its maiden year as being gimmicky and merely a cute user interface — easily replicated — instead of offering a full-fledged product.

To that, Goldstein responds: “Well, I think it’s hard to call us just a feature anymore. We’ve got two killer products on the Web (flights and hotels), dozens of partnerships with suppliers and the best mobile app in the business. Ultimately, we measure our success by the number of satisfied users, and that number continues to increase.”

 
 
Dennis Schaal

About the Writer :: Dennis Schaal

Dennis Schaal was North American editor for Tnooz.

 

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  1. Roger W

    Nice write up Dennis and congrats to Hipmunk on their 1-year anniversary. Regarding Adam’s intuition about the look-to-book ratios, that only matters to the feed providers and if you have one primary method of monetization.

    For sites like Kayak and most other metasearch sites, you manage the monetization across all ad units in the path since the more links you have the more likely conversion rates will be impacted negatively. Once you know how much you make for each type of ad unit under each type of search, you optimize the real estate given. On Kayak, the combination of multi-check ad units + Kayak/Google text ads are definitely eating into the conversion rates from the main results area but holistically, they may be making more even with a weaker look-to-book ratio.

     
 
 

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