Expedia Inc. might be quiet on the acquisition front as its new leadership settles in. But history shows the online travel giant will look to be opportunistic as its competition with the Priceline Group evolves.
The departure of longtime CEO Dara Khosrowshahi from Expedia Inc. last month came as a major surprise. The announcement of chief financial officer Mark Okerstrom as Khorowshahi’s successor, however, represented the sensible continuity pick to lead Expedia.
In his first travel industry public appearance following his promotion this month, Okerstrom told the crowd at the Skift Global Forum 2017 in New York Wednesday that the online travel giant isn’t in a position where it has to continue acquiring companies to add to its portfolio, but the company is keeping tabs on what’s available.
When asked whether a deal for HotelTonight is being explored, Okerstrom suggested he isn’t looking to acquire any companies right now.
“HotelTonight has built a beautiful product,” said Okerstrom. “Everything in the world is on our watch-list right now. HotelTonight is on our … ‘Sam [Shank, HotelTonight CEO], let’s have a beer and talk about it’ list … but no company is on our must-have list.”
Okerstrom indicated that Expedia Inc. isn’t likely to acquire the newly public Despegar despite its stake in the company. He did mention that Expedia’s various brands will likely explore a deeper push into tours and activities, perhaps encouraging customers to add “bus tours or scuba dives” onto their existing trips.
Hotel Could Blunt Growth of Alternative Accommodations
On the subject of the tension between hotels and alternative accommodation providers like Airbnb and Expedia’s HomeAway, Okerstrom said that hotel chains should evolve to meet the needs of potential travelers.
“There are actually only a few situations where there is really cannibalization of hotel business by alternative accommodations,” said Okerstrom. “It’s completely separate use cases. There is a great opportunity for hoteliers to do a much better job at bringing situations where you have adjoining rooms online, so you can book them together or be much better at displaying inventory that has a kitchen or multiple rooms. This could put them in a spot where they can shut down some of these reasons travelers pick alternative accommodations.”
Okerstrom also shared his opinion of the transformative capability of blockchain. In short: it’s too soon to tell.
“For it to ultimately be a disruptor, blockchain has to be either cheaper or better and we’re not quite in the spot yet where we know the answer to the question,” said Okerstrom. “We were early adopters of bitcoin and we have teams looking into blockchain. I don’t think it’s a threat to us, even if I’m constantly paranoid about everything.”
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Tags: expedia, mergers and acquisitions, sgf2017, skift forum
Photo credit: Expedia's new CEO, Mark Okerstrom (left), made one of his first travel industry appearances as CEO at Skift Global Forum in New York City September 27, 2017. He said the company doesn't really need to make any acquisitions right now in order to spur growth. Skift