Articles tagged “orbitz”

Breaking up is hard to do but when it comes to mergers, the stakes can be very high and the challenges acutely complex. It's really hard to find someone who will argue that Expedia's acquisition spree will be its undoing but success will take focus and certainly isn't guaranteed.

The Jeff Katz and Boston Consulting Group startup Dihedral -- with an assist from two major airlines and four hotel chains -- can turn out to be something huge or meander nowhere like some of the traveler journeys they'll be charting. Certainly the two have a track record and they are hitting all the right notes, including Big Data and experiences.

As when it acquired Travelocity in early 2015, the Expedia Inc. acquisition model for Orbitz and CheapTickets is to slash employee rolls, find other cost synergies, move the newly acquired companies to the Expedia technology platform and continue to market the slimmed-down brands. As Orbitz begins its 16th year, it wouldn't be surprising to see the brand get more aggressive in its advertising.

We're not giving away all the good stuff. You still need to read the entire thing.

Expedia's acquisitions in 2015 made it more of a U.S.-focused company, a weakness it intends to rectify in coming years. Meanwhile, the market share impact of its buying spree won't really be felt until 2016 and beyond.

If the integration goes as Expedia and HomeAway envision then this merger can turn out to be transformational for both companies. If that becomes the reality, then the Expedia acquisition of Orbitz may end up being viewed in coming years as a mere footnote in Expedia's timeline when compared with the HomeAway buy.

In the consolidation game, Expedia's business model is to do heavy integration of the acquired companies' back-end platforms while retaining their brands and axing lots of employees to trim costs and boost the bottom line. Synergies for some, unemployment for others.

Everyone knows that being nimble enough to test and introduce new technology is a tremendous advantage. Behind the scenes, though, Expedia got good at another skill -- moving really fast to identify and make acquisitions.

It's all about scale for Expedia. The company can use its expertise to add vacation rentals to heighten conversion, which in turn enables Expedia to spend more on marketing. That's good for vacation rentals and, in theory, for hotels as well as it should generate increased demand.

Independent hoteliers are indeed exploring alternatives to the big online travel agencies, including finding ways to spur more direct bookings, but sometimes it seems like a steep, uphill battle.