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Data Minded Expedia Predicting Future Travel Booking Trends

To best serve its customers Expedia is going gaga for data so they can peer into the future and adapt nimbly. Here’s what it means for your hotel.

Wednesday, December 18, 2013
Glenn Haussman
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We love data! It’s the engine powering understanding and insight, which is critical to making the right business decisions. Basically strong data is akin to having your own personalized crystal ball. You can more clearly see the future than your competition, and that makes planning strategy that much easier.

At Expedia, data is king and it’s the engine driving hundreds of millions of research investment dollars every year ($1.6 billion at Expedia in the last four alone). Plus, for this company, understanding where its customers want to travel, how they desire to book travel and how they want to experience a destination once they get there is how they create their secret sauce.

So it’s easy to see how they’ve become hooked on understanding the traveler psyche. Fortunately Hotel Interactive had an all access pass to last week’s 14th Annual Expedia Partner Conference where we got to explore our mutual love for understanding the numbers and how to translate that into something physical customers crave.

Expedia is made up of multiple brands including Hotels.com. Hotwire.com, the travel management company Egencia, as well as hotel search company Trivago, the European reservation venere.com and eLong.com, a Chinese hotel reservations company.

At the conference’s general session Dara Khosrowshahi, CEO of Expedia Inc. & Brand President of the Expedia site said there are myriad changes taking place in the way people book travel, and if you’re not planning for tomorrow the future could catch you unprepared.

“With the all changes we are seeing this is a wonderful opportunity to build and grow business to a new global audience,” Khosrowshahi said to the audience filled with folks such as hotel operators, travel companies and hotel level sales professionals who use Expedia’s services to drive their own businesses. “If you are slow and not looking forward it could be trouble.

“Innovations are coming faster and the rate they are coming is not slowing down. We absolutely see rate of change accelerating. We set up this company to be agile and take advantage of change,” he said.

Khosrowshahi added the company is investing heavily in technology to ensure they’re not left behind as new travel booking habits and systems emerge. He indicated the company has increased its investment five-fold in recent years to morph from a company that thought more about overall strategy to an agile organization that can predict the future and react very quickly to marketplace changes.

“We let the consumer tell us what they want,” he said noting Expedia’s various entities are seeing major shifts in demand patterns. In the United States Khosrowshahi said the number of visitors here would jump from 67 million last year to 85 million by 2018.

“U.S. arrivals are up 25%,” said Mark Okerstrom, Expedia’s Executive Vice President and Chief Financial Officer. “We are bringing the world to the United States.”

Plus more people around the world are traveling for the first time than ever before, so Expedia now has sites in more than 70 countries utilizing more than 36 languages over more than 150 sites.

Some major changes they are seeing in the marketplace that will have a massive effect on the future of travel include:

China is responsible for one third of the growth of world travel and its citizens are already spending $102 billion annually. For comparison Germans spent $83.8 billion during the last year while Americans spent $83.7 billion. The Chinese market has grown 10 fold in five years.

PCs are now the minority of connected devices in the world. “If you think about online and think of PCs you are thinking about yesterday and not where things are going now. Eyeballs are moving to digital especially mobile,” said Khosrowshahi.

Expedia said mobile room nights booked are up 135% this year and the industry should expect the same next year. Expedia’s various mobile apps have been downloaded 80 million times.

Johan Svanstrom, President, Hotels.com and Venere said mobile is poised to eclipse other booking methods. “Mobile is changing booking behavior. It is going to change companies’ business models. During the next 18 months more than 50 percent of traffic will come from mobile devices,” he said in an interview with Hotel Interactive.

Khosrowshahi added the booking experience is becoming a multi-screen experience with people researching on one device and switching to another to gain additional information and then booking on yet another device. Think of it this way. Someone researches a destination or hotel on an iPad while watching TV, does some more research while commuting on their smart phone and then books a trip using their PC or laptop at work. This is pushing the advancement of ‘responsive’ websites that understand which device is being used and translates the information into an appropriate format for that specific device.

“People are limited to the devices they know, but in reality you have to think further ahead and what content will look like on other devices. We are at the beginning of this responsive idea and we have to extend out to where we think it is going,” said John Kim, Senior Vice President, Global Products, Expedia.

Glenn Haussman    Glenn Haussman
Editor in Chief
Hotel Interactive, Inc.

Bio: Glenn Haussman is Hotel Interactive's Editor In Chief, where he manages all editorial content for the hotel industry’s leading online information resource. Here he creates unique and in-depth content that stimulates and educates the publication’s ...
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