The Priceline Group is looking for a CEO who can handle disruption and big changes in technology and market conditions in coming years. Just look at the changes in the Group's accommodations mix as lodging alternatives are approaching half of the company's roster of properties.
The Priceline Group’s alternative accommodations, including vacation rentals, apartments and short-term rentals, are growing faster than hotels and are approaching half of the company’s overall inventory.
The Group currently lists 423,285 alternative accommodations, or 47 percent of its overall property roster.
In the first quarter, officials said during the company’s earnings call today, Priceline’s number of accommodations jumped 30 percent to more than 900,000 properties. The Booking.com site now says it has 900,364 properties.
Interim CEO and chairman Jeffery Boyd, who reassumed the CEO post last week after the ouster of Darren Huston over a workplace relationship that allegedly violated the company’s ethics code, said vacation rentals and alternative accommodations are “a very important source of growth for business going forward.”
Of course, although alternative accommodations now make up 47 percent of the Priceline Group’s properties, they generally have far fewer rooms than hotels do.
“We couldn’t be more enthusiastic for these types of accommodations,” Boyd said, adding that he’s confident the company can continue to build its alternative accommodations inventory and provide a booking experience for consumers that’s superior to any competitors.
CFO Daniel Finnegan said the “take rate,” or the amount of commissions and fees that Priceline collects in vacation rentals and alternative accommodations is on par with that of hotels.
On the CEO Search
Asked about the board of director’s search for a permanent CEO, Boyd said it would commence “straight-away” and that the company is looking for someone with “broad experience” and a proven track record of running a global operation, and an individual who can deal with changing technologies and market conditions.
Asked about what changes he’s seen since departing the CEO role at the end of 2013, prior to his return last week, Boyd said he’s impressed with the vast global market opportunity that’s present for Priceline and its competitors, and the resiliency of the Group’s companies in the face of periodic terrorism incidents and economic cycles.
Facebook and Youtube
Regarding other changes since he left the CEO role two years ago, Boyd said alternative marketing channels such as Facebook and Youtube provide a great opportunity for companies that can execute well in diversifying their distribution to stir customer demand.
Direct Booking Initiatives
Asked about the move by hotels chains such as Hilton, Marriott, Hyatt, and InterContinental Hotels Group to drive direct bookings at the expense of online travel agencies, Boyd said their plans are understandable, but Priceline’s customers deserve to have competitive rates and availability.
He pointed out that the Group’s business with hotel chains is “relatively small” – compared with independents — especially compared with the heyday of Priceline.com when most of the company’s hotel business was U.S.-based.
What Does the Future of Lodging Look Like?
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Photo credit: Priceline Group is seeing rapid growth in vacation rentals and other alternative accommodations. Priceline Group