TripAdvisor is notable for having a large audience of consumers looking for ideas about where to go and stay and what to do once they're there. It's sensible that the company is adding features to bolster that edge over its transaction-focused rivals — as long as the company doesn't neglect transactions.
TripAdvisor debuted earlier this month a test for consumers of a travel-specific feed of personalized recommendations from friends, social media influencers, and publishers. Already, 750 content providers have signed up.
The new feature aims to answer a key question — “How do we lay the groundwork to delight the traveler for all phases of the trip truly?” — according to TripAdvisor CEO Steve Kaufer, speaking at Skift Global Forum on Thursday in New York City.
While the company’s reviews and ratings are already influential, Kaufer said, the challenge now is “how do we take it to the next level to make sure a recommendation is relevant to you [the individual user]?”
However, Kaufer added that monetizing customers remains a specialty, and an emphasis for the company.
Kaufer believed that the content could scale up quickly because it is free and beneficial for content providers to participate. “The content that you’ve already produced, maybe a year ago, you can come to our platform and for free in five minutes, upload it, and give it exposure to a broader, relevant audience,” said Kaufer. “That can build the stature of your brand.”
The effort may help the company keep pace with competitors. Kaufer acknowledged that TripAdvisor faces some competitors online, such as Google.
“Google has an interest in pushing the reviews they collect on their own,” Kaufer said. “But the quality of those reviews doesn’t match the quality of what’s providers by others like ourselves.”
Rebound in the Offing?
In recent months, TripAdvisor’s share price has rebounded to levels last seen in January 2017. Investors seem to believe that the company may have seen through the worst of the rationalization efforts of price-comparison advertising spending by the giant online travel conglomerates and that hotel revenue could return to growth perhaps as soon as the second half of this year.
Investors also seem drawn to the idea that there could be substantial value in the non-hotel businesses like attractions.
Kaufer argued on Thursday that while some critics focus on the challenges TripAdvisor has faced in its hotel price-comparison search business, the company has built two promising platform businesses — businesses that bring demand and supply together and benefit from a network effect — for the enormous markets of restaurants and attractions in the past four years. Kaufer has previously suggested the attractions unit could become an approximately $2 billion business, for instance.
In a recent note, Jake Fuller, investment analyst for Guggenheim Partners, wrote: “The addition of venture capitalist Jay Hoag to TripAdvisors’ board has been seen as a validation of the idea that there must be real strategic value to the organic traffic, the brand, non-hotel assets or something else entirely that the rest of the market has yet to identify.”
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Photo credit: TripAdvisor CEO Steve Kaufer spoke on-stage Thursday, September 27, 2018, at Skift Global Forum in New York City. Matt Mateiescu / Skift