The Takeoff Episode 02: How Startups Can Adapt and Pivot Sponsored This content is created collaboratively with one of our sponsors.
It is almost impossible to imagine that TripAdvisor wouldn’t find an online travel agency partner for a Book TripAdvisor option within its mobile apps, but lots of the usual suspects are wary about TripAdvisor getting closer to the transaction part of the travel cycle, and getting even more powerful in the process.
It’s going to get done eventually, but TripAdvisor is admittedly facing some resistance to achieving its self-described “key product focus in 2014” — enabling travelers to book hotels within TripAdvisor’s mobile apps.
TripAdvisor CEO Stephen Kaufer has been talking about such an “assisted booking” option since May 2013, and when I asked him about it during an interview in October 2013, it was clear from his reaction that TripAdvisor was working on it, although Kaufer said he had nothing to announce at that moment.
During the company’s fourth quarter earnings call on February 11, 2014, Kaufer said TripAdvisor would launch what might be called a Book TripAdvisor mobile option sometime in 2014, and in answer to a question, he acknowledged that some online travel agencies — probably the larger, important ones — “might prefer for us not to change the model because they’re perfectly happy getting the clicks themselves and preferring to drive more app downloads or other activities that they wouldn’t necessarily get as much of a chance to do if we’re taking a transaction.”
Why is a Book TripAvisor option so important on mobile devices? Because it would vastly increase conversion of lookers to bookers if they don’t have to navigate away from the app to a diverse collection of third-party websites of varying quality to complete the booking.
Lots of would-be mobile bookers get lost in that hand-off so that is why enabling the bookings within the TripAdvisor apps is of paramount importance.
Until the last few years, travel metasearch sites never enabled such bookings within their own websites or apps, but pass consumers to online travel agency and airline, hotel or car-rental websites when it came time to complete a booking.
But now sites such as Kayak and Room77, for example, increasingly are offering assisted bookings where the traveler completes the reservation on their sites or apps, although an online travel agency in the background is actually the merchant of record and handles customer service.
To the consumer, it may appear to them that Kayak or Room77 is acting like an online travel agency/booking site and processing the transactions themselves because they fill out all of their personal and credit card information within the app.
In reality, though, there may be a partner online travel agency in the background processing the transaction and performing customer service.
In the Kayak screenshot above, a traveler would see that the Travelocity Partner Network — which ironically was just sold to Orbitz — handles customer service when consumers complete the transaction on Kayak.
So apparently TripAdvisor may be having a hard time finding a major online travel agency partner to do the back-end processing for a Book TripAdvisor option on mobile.
However, given TripAdvisor’s importance as a marketing vehicle for just about everyone in online travel — including major customers Expedia Inc. and the Priceline Group — it is almost impossible to imagine that TripAdvisor won’t find a partner for its assisted bookings.
For Expedia, which spun out TripAdvisor in late 2011, the issue comes down to transparency in that Expedia wouldn’t want travelers to be confused into thinking that TripAdvisor is actually doing the transaction.
Speaking at a Morgan Stanley conference in San Francisco earlier this week, Expedia CFO Mark Okerstrom said Expedia would be open to be a partner in TripAdvisor’s assisted bookings — depending what the implementation looks like.
“Provided the line is clear, we are very interested in it,” Okerstrom said.
For its part, TripAdvisor is not yet engaged in any beta tests for assisted bookings, said TripAdvisor spokesperson Kevin Carter.
Asked whether TripAdvisor is having trouble finding a partner, the spokesperson said:
“Our progress on assisted booking is proceeding according to the timeframe we have reported publicly [sometime in 2014],” Carter said. “As Steve noted on our last earnings call, we’re happy with the progress that we’ve made.”