Expedia’s Answer to TripAdvisor-Priceline Deal? Direct Hotel Booking on Trivago

Expedia Inc. has an answer to TripAdvisor’s blockbuster booking partnership with the Priceline Group. Similar to TripAdvisor Instant Booking, Expedia-owned Trivago has launched hotel bookings on its site and app in Germany, and plans to expand it into English-speaking countries.

That’s the word from Expedia Inc. CEO Dara Khosrowshahi, who acknowledged concerns about the enhanced ties between rivals TripAdvisor and the Priceline Group during Expedia’s third quarter earnings call today.

Metasearch sites such as Trivago and TripAdvisor traditionally show hotel offers from the hotels themselves and online travel agencies, but sent consumers to the hotel and online travel agency websites to complete the bookings.

But TripAdvisor, and now Trivago, are taking the bookings right on their own sites in partnership with hotels and online travel agencies. They also do the traditional metasearch that they have done for years, as well.

Some 90 percent of Trivago’s desktop traffic and half of its app users in Germany can now participate in these on-site and in-app bookings.

Khosrowshahi conceded that TripAdvisor’s booking partnership with the Priceline Group, including Booking.com, Priceline.com and Agoda, was “not a positive” development for Expedia and could hurt Expedia’s volumes from TripAdvisor. He added, though, that TripAdvisor, although an important distribution channel for Expedia, is a low-margin one.

In addition to Trivago, Google is testing hotel bookings on its search pages and in Google Maps and Khosrowshahi said Expedia intends to test this Book on Google feature, which he said might provide better branding for Expedia than TripAdvisor would do. This could make things more clear to consumers that they would be booking a hotel on Google, but Expedia would be the merchant of record and provide customer service.

Khosrowshahi said the data that Expedia gathers from testing Book on Google and feedback from consumers will drive the decision on whether Expedia ultimately will participate in Book on Google.

He left the door open, as well, for Expedia to eventually join the Book on TripAdvisor program.

Skift reported earlier this week that TripAdvisor intends to give partners some flexibility in how they brand themselves when they participate in TripAdvisor Instant Booking.

Khosrowshahi said enhanced branding within TripAdvisor Instant Booking might be a positive development. Expedia is engaged in a dialogue with TripAdvisor and can always revisit whether or not to join TripAdvisor Instant Booking, he added.

On the new booking initiative from Trivago, Khosrowshahi said various Expedia brands are participating in it as booking partners in Germany.

Meanwhile, Khosrowshahi said Expedia is investing aggressively in Trivago, which “has been very strategic for us.”

Trivago’s revenue grew 27 percent in the third quarter, year over year, to $176 million.

Khosrowshahi said Trivago could easily be turned into a profitable enterprise but it is currently focused on growth.