There's little doubt that Tans' abrupt departure, without any transition time, points to conflicts within Booking Holdings over the company's strategic direction.
Gillian Tans is out as president and CEO of Booking.com and the parent company’s chief executive, Glenn Fogel, is assuming her role, effective immediately.
Booking Holdings announced these moves Wednesday, along with Tans sliding over to be Booking.com chairwoman, a newly created position.
Booking Holdings didn’t specify a reason for the sudden change, but perhaps hinted at some of the factors in a quote from Fogel in the announcement that includes more collaboration of its once-siloed brands.
“I am excited by the opportunity to guide our largest business and drive even more alignment across the Booking Holdings brands as we continue on our mission to help people experience the world. We are executing against a large market opportunity with a clear strategic roadmap,” Fogel said in that statement. “Working with the full Booking.com global team, I believe we can identify ways to drive more collaboration and integration to strengthen the company’s positioning for long-term success.”
To understand Gillian Tans’ historical role in building Booking.com as an early employee, read The Oral History of Travel’s Greatest Acquisition — Booking.com.
This increased collaboration among the various brands, including Booking.com, Kayak, OpenTable, Agoda, Priceline, and Rentalcars.com, has been a hallmark of Fogel’s tenure as Booking Holdings CEO, a position he took up in 2017. Previously, the various brands operated more independently, and there may have been some sparring between Tans, Fogel and Kayak CEO Steve Hafner over how — and whether — that collaboration would take shape.
[Update: It should be noted that with Fogel now the CEO of both Booking Holdings and its largest brand, Booking.com, he takes on the same duties that former CEO Darren Huston, who was ousted in 2016, wielded.
Asked about Booking.com’s pace of growth and the collaboration issue, Booking Holdings spokeswoman Leslie Cafferty said: “There are opportunities for more collaboration across the Booking Holdings brands, and Glenn has worked with all of the brands and their leadership teams for years, so he can definitely help identify those opportunities to help Booking further its vision to connect travelers to more experiences beyond just the accommodation. Gillian’s new role will focus on further building partnerships for the Booking brand, including continuing important collaboration efforts with governments throughout the world and identifying new partnership opportunities.”]
Tensions within Booking Holdings were reported in an article from The Information (subscription) last month, which inferred a power struggle taking place involving Hafner and Tans over the future direction of Booking Holdings, and how some of that brand collaboration was being implemented.
“We kind of need to decide what we’re going to be when we grow up in the next five years,” Hafner was quoted as saying in the article. “Are we a value stock? Or are we a growth stock? Right now we’re kind of neither. It’s more fun to be a growth stock, but you need to have good ideas.”
Was there a lack of good ideas from some of the top leadership?
The Information’s piece rankled some within the organization.
Tans and Hafner may have sparred over the leadership of the struggling dining reservations platform OpenTable, which Booking acquired for $2.6 billion in 2014 but had to take a $941 million writedown of the business a couple of years later. OpenTable CEO Christa Quarles stepped down from that position last year, and Hafner assumed responsibility for the dining platform within the Kayak umbrella.
Some within Booking Holdings reportedly argued that the much-larger and Europe-oriented Booking.com would have been a better fit for OpenTable than at Kayak.
Under former Booking Holdings — it was then called the Priceline Group — CEO Jeffery Boyd, the strategy was to let its brands operate independently because, after all, one of the reasons the parent company bought these brands to begin with is because of the caliber of their management.
Under Fogel, the parent company is tying the various brands closer together. Kayak leadership has taken responsibility for OpenTable; Rentalcars.com has been folded into Booking.com, and Agoda is working in tighter collaboration with Priceline, for example.
Booking Holdings didn’t cite a reason for Tans’ abrupt departure.
“Since the moment I have joined Booking, I have had the pleasure to work with such great people all over the world who are making Booking a success every day,” Tans said in the announcement statement. “Together we have built an amazing culture. Serving as their CEO has been an honor and together we paved a journey to empower people to experience the world! I look forward to serving as Chairwoman.”
Tans, who took over the leadership of Booking Holdings’ largest business, Booking.com, in 2016, was among the highest-paid executives in online travel globally. As president and CEO of Booking.com, Tans’ total compensation in 2018 was $14.47 million, a roughly 6 percent increase over the previous year. That compensation included a $4.8 million cash bonus, down from $5 million in 2017, and it was tied to Booking.com’s EBITDA performance.
All of Booking Holdings’ top execs received 5 percent less in 2018 cash bonuses year-over-year “due to certain operational issues during 2018, including, among other things, certain non-income based tax issues at one of our smaller brands, certain systems issues that arose during the year and delays in the integration of our Rentalcars.com brand into our Booking.com brand,” the company stated in an April financial statement.
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Tags: booking holdings, booking.com, glenn fogel, kayak, opentable
Photo credit: Booking.com CEO Gillian Tans spoke at the Skift Global Forum in New York City in 2016. Tans was replaced as Booking Holdings CEO on June 26, 2019. Skift