CEO Glenn Fogel has said before Booking Holdings must knit together "the connected trip" for customers, but not everyone has grasped the vision. Fogel seems right in saying that selling bundles of travel products is no longer enough in an era of Uber- and Amazon-style customer service.
Booking Holdings CEO Glenn Fogel is used to being a bit on the defensive about Airbnb. The rival online travel agency has much better brand recognition in many markets than his conglomerate’s flagship brand Booking.com — particularly with short-term rentals and vacation homes.
So Fogel seemed to enjoy teasing Airbnb CEO Brian Chesky about some comments Chesky made about performance marketing earlier during the same New York conference this week, Skift Global Forum.
The CEO also expanded on what his company’s “connected trip” strategy means, and that it’s not just empty words for marketing.
Fogel was asked on Thursday by Skift Executive Editor Dennis Schaal about his reaction to Chesky’s comments earlier in the forum that Chesky doesn’t want to return to past levels of spending on Google search ads and other forms of performance marketing.
Some context, first: In 2019, Airbnb reported $1.14 billion in sales and marketing expenses related to performance marketing. On Tuesday, Chesky spoke about what the approximate unaudited “run rate” of spending by Airbnb was leading into March 2020.
“We were spending $800 million on a run-rate basis on marketing, mostly on Google Keywords,” Chesky said. “So we shut off $800 million of run-rate marketing. And what happened was our profit was still 95 percent of the year prior. So we started realizing maybe we don’t have to return to that level of spending, and we have not.”
When quizzed about the comments, Fogel seemed bemused.
“They may have misspent $800 million,” Fogel said. “Did they fire the CMO [chief marketing officer]? They spent $800 million, and nothing worked?”
Fogel acknowledged that Airbnb has “clearly” great branding overall, and he complimented Chesky for being a talented leader.
Schaal also asked Fogel about comments made the previous evening at Skift Global Forum by Expedia Group vice chairman and CEO Peter Kern.
Kern had quipped about Fogel’s frequent recent commentary that Booking Holdings was looking at building “the connected trip.”
“It’s a good set of words,” Kern said. “But we’ve been in the trip business for a long time, and we sell more multi-product trips than any other OTA [online travel agency] in the world. We’re going to keep doing it.”
Fogel defended his ” connected trip ” concept after complimenting Kern for his stewardship of the rival conglomerate.
“It’s not just a bunch of words,” Fogel said. He clarified his vision that online travel agencies should be much more proactive about ensuring that if a problem arises with any aspect of a person’s trip, they should be able to rebook and service all the other affected elements of a trip immediately.
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Photo Credit: Booking Holdings CEO Glenn Fogel at Skift Global Forum 2021. Skift