PHOENIX—Expedia is seeking a “symbiotic” relationship with search-engine giant Google as the latter elbows its way into the travel distribution space, according to a senior director with Expedia.
“They continue to be, call it a partner, call us a customer of theirs, in a very tight part of the ecosystem we are with them,” said Jay Hubbs, senior director of revenue management for Expedia Partner Services Group.
Expedia provides rate, availability data and booking links to Google for use in the latter’s evolving Hotel Finder and Hotel Price Ads features.
Senior director of revenue management for Expedia Partner Services Group
“I know obviously they don’t want to damage that relationship, and we want to make sure we continue to work with them,” he added.
Hubbs spoke with HotelNewsNow.com during a break at last month’s Lodging Conference at the Arizona Biltmore hotel.
“It’s clear (Google wants) to differentiate themselves a little bit more than just being a ‘search engine.’ That was clear with the acquisition of ITA, and now we’re seeing some of the fruits of that acquisition,” Hubbs said.
Google last month launched its airfare search tool. The tool utilizes the fare-search technology of ITA, which Google acquired in April for US$700 million. During August the search engine launched Google Hotel Finder, a build out of Google Places that allows users to search for and compare hotels by region, Google reviews and price comparisons.
“It will be a very interesting six to 12 months, or even shorter, as the landscape continues to evolve,” Hubbs said.
“It’s a little too early to make a judgment one way or the other,” he added.
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The billboard effect
Hubbs also tackled the “billboard effect” study, which many industry experts say overestimates the marketing value of online travel agencies.
In the experiment, which was conducted by Cornell University’s Chris Anderson, researchers cycled four JLM Hotel properties on and off Expedia for periods of seven to 11 days. At the end of the 80-day trial, each hotel had been displayed on the site for 40 days and not displayed for 40 days. After measuring the average daily reservations booked through sites excluding Expedia, Anderson found Expedia created a lift of between 7.5% and 26% for non-Expedia reservations.
“Hotels clearly saw a difference in what their overall bookings were when they were on Expedia,” Hubbs said. “That just points to the marketplace that Expedia provides, whether that person converts on our site or goes to a brand.com site, or somewhere else.”
Hubbs declined to estimate the marketing lift Expedia generates for any particular brand.com website. “Obviously none of us has any sense of when people are coming to us what they are coming to look for,” he said of the millions of customers who visit the Expedia family of websites each day.
Still, Expedia spends millions of marketing dollars to drive customers to their websites.
“Getting them into the store is obviously what we put a lot of effort on from a marketing standpoint,” he said. “We want to convert them here, but obviously there’s a large part of the conversion that happens either on brand.com or other sites.”
The important thing for revenue managers, Hubbs added, is they list their product on OTAs in the first place.
“If you’re not in that marketplace, you’re not going to capture that customer,” he said.