Kayak’s CEO: First AI-Online Travel Deal Will Be Like ‘A Dam Breaking’

Kayak CEO Steve Hafner said he “fears” 2025 will see the first successful commercial agreement between an AI engine and a major travel player, and then “it’s going to be a little bit like a dam breaking.”

“Once one of the AIs makes it work with one big travel player, everyone else is going to run to cash out,” Hafner said, citing Airbnb and Kayak’s sister company Booking.com as being in that major travel company category.

Hafner was speaking at Skift’s Megatrends 2025 event in Manhattan Tuesday on “What’s Ahead for 2025.”

Hafner said it needs to get sorted out how AI will get commercialized in travel in terms of “who takes credit for the actual booking.”

For example: Does the booking go through Google’s Gemini directly to the hotel or airline, or does it go through an intermediary like Kayak?

Changing consumer behavior and upcoming regulation will also help determine the future of AI and travel, he said.

Will Travelers Abandon Travel Sites and Apps?

Hafner said he’s concerned about whether traditional travel sites will be a casualty of changing consumer behavior.

“My fear is that they’ll stop going to traditional travel sites by visiting them or downloading an app, and they’ll rely more and more on social media,” Hafner said. “That’s where they’re already spending their time, and then ChatGPT and these AI models where you get answers.”

Kayak’s Building Its Own Large Language Model, But …

Hafner said Kayak’s building its own Large Language Model — “a lot of other companies are doing the same” — because the costs are dropping. But it’s also providing data to Google Gemini.

“But just because Kayak AI is better than the Kayak flavor on Gemini doesn’t mean people won’t use Gemini instead,” he said.

Kayak Plans to Leverage the Mass Market on Social Media

As one Skift Megatrend pointed out, “Influencers Are the New Power Brokers in Travel.”

Hafner agreed, saying influencers “really move the needle,” and have replaced reading reviews like his generation did on Tripadvisor.

He said Expedia is probably the most advanced company in travel in the use of influencers as it’s “gone with a curated list of creators.” They make recommendations that can be booked on the platform.

The Kayak CEO said his company will take a different route. “We’re going to try to go the mass market with it,” Hafner said. “You can share your favorite destinations, and if someone actually buys through that, you get paid. Pretty cool. So we’ll take social media, try to turn that into performance
marketing channel.”