Expedia ups the ante in Europe, undeterred by Priceline’s Momondo deal
Expedia Inc‘s CFO Mark Okerstrom is confident Europe remains a “huge opportunity” for its brands and promised it will be “more aggressive” in the region this year.
Speaking at the Goldman Sachs Technology and Internet Conference yesterday, he said:
“I don’t think it [Priceline’s acquisition of Momondo] changes the dynamic for us…We continue to see Europe as a huge opportunity and we have all the ingredients in place to be very competitive – a standalone agency hotel product, we’re better at online marketing than we have been before, we have great converting websites.
“If anything, we’ll be an inch more aggressive in 2017 than we were in 2016 where the focus was on integration.”
And he added that it will get more aggressive “everywhere, aside from the US.”
The Momondo deal was only announced ten days ago so the impact on Expedia and the wider market will emerge over time, unlike the Airbnb effect, which has been on every travel company’s watchlist for some time now.
Again, Okerstrom seemed unfazed – if anything he talked up the billboard effect of Airbnb as a flag flier for the alternative accommodation sector generally, insisting this is good news across Expedia’s portfolio of brands, not just HomeAway.
He said that 20,000 instantly bookable HomeAway properties “in urban areas” had been added onto Expedia.com, and that HomeAway could also be a channel to sell traditional hotel products.
The cross-selling of HomeAway and hotels is framed around Expedia’s take that “consumers in the future are going to draw less of a hard line between hotels and alternative accommodations.”
And he hinted that this “blurring” might be a headwind for Airbnb, assuming that it keeps on being seen as a home rentals platform.
“Offering a broad spectrum of properties will be a big advantage for us over pure-play players,” he said.
Airbnb does have some partnerships in place to distribute hotels, while its purchase this week of Luxury Retreats was seen as a move into new sectors. Whether consumers will take its new breadth of product on board depends on how ingrained the “live like a local” mantra has become.
The impact of Airbnb is a default question for any conference moderator, as indeed are questions about China. Okerstrom noted that Expedia, hotels.com and Egencia are active in China outbound, its lodging teams are in the market signing up inventory for inbound but that its lack of presence in domestic Chinese travel “is a strategic gap we’d like to fill at some point.”
He also mentioned the importance of the Expedia Affiliate Network in China, which is working with OTAs, offline travel agents and airlines and is “keeping us relevant from a volume perspective.”
Elsewhere, he said that the business is “excited about the prospects” for India and will be more aggressive there this year and next.
“[India] is at a stage now where there is some rationality returning the market after the MakeMyTrip/Ibibo combination, and we’re looking at India as somewhere we might be a bit more aggressive in 2017/2018.”
Click here to access Expedia’s Investor Relations page from where the 30-minute webcast can be accessed.
NB: Image by VectorPot/BigStock
Martin Cowen is contributing editor for Tnooz and is based in the UK. Besides reporting and editing, he also oversees our sponsored content initiative and works directly with clients to produce articles and reports.
For the past several years he has worked as a freelance writer, specialising in B2B distribution and technology.
Before freelancing, from 2000-2008, he was launch editor for e-tid.com, the first online-only B2B daily news service for the UK travel sector.