In 2000, Stephen Kaufer co-founded TripAdvisor with the sole objective of helping travellers plan their trip better. It has since become one of the world’s largest travel sites, with a little over 50 million monthly visitors. He talks to Ruchika Chitravanshi on how the India venture has paid off and offers an outlook for the sector. Edited excerpts:
What are the most important travel trends now, both for India and abroad?
Despite the current economic climate, nearly a third of US travellers are looking to increase their travel spending, compared to 2011. We also see a surge in popularity for cultural trips and cruises this year. For India, too, the broad trends for 2012 are strikingly similar to the US. Around 53 per cent of Indian travellers claimed they’d travel more in 2012, with 20 per cent more travellers planning to take an international holiday. Also, 44 per cent of Indian travellers are looking at spending more on their holidays in 2012 than last year.
Are you seeing any signs of slowdown? How is it reflecting in consumer behaviour?
Overall, people are still travelling. TripAdvisor continues to grow, especially internationally. Consumers may be looking at different kinds of trips and are perhaps more cautious about how they are spending their money. Price comparison in travel reviews is even more important in this economic climate and TripAdvisor plays an important role with travellers’ research in wise spending.
How is TripAdvisor going to make more money – are you diversifying business?
TripAdvisor has established a compelling and differentiated business model, based on rich user-generated content, which creates valuable monetisation avenues. The spin-off will not change our primary business model or monetisation opportunities.
How has the India venture paid off?
Launched over three years ago, the TripAdvisor India domain has grown by leaps and bounds, as Indian travellers seek to derive better value from travel budgets by exploring their destinations and hotels on the site. Indians are slowly, but surely, taking to the concept of planning their trips based on the experiences of other travellers, and the fact that TripAdvisor has the widest and largest amount of content on Indian destinations and hotels, has resulted in the tremendous popularity of the site within a very short period. TripAdvisor is also playing an important part in catalysing online Indian hotel bookings and adding transparency in booking decisions by providing real traveller hotel reviews, as well as providing choice to book from a number of our partner booking sites.
What opportunities would you like to invest in?
We are excited about three core growth opportunities -- new platforms, new geographies and new products. Regarding new platforms, mobile will continue to be a focus area for TripAdvisor. As smart phone and tablet adoption continues to grow across the globe, TripAdvisor continues to explore ways to put the power of the world’s largest travel site into the hands of travellers no matter where they may be, no matter what device they are using.
Over the past year, we developed new applications for new platforms, including the iPad and Windows Phone 7, and we have added features to our mobile offerings, including Live View, and My Saves. TripAdvisor will also continue to expand in new markets and penetrate further in existing ones, with China a particular focus.
Regarding new products, vacation rentals present a continued growth opportunity. We plan to feature over 200,000 vacation rental listings through our previous acquisitions, including FlipKey and Holiday Lettings, and new partnerships with Interhome, Stayz, Toprural and AKENA.
How will the spin-off from Expedia impact TripAdvisor’s business?
TripAdvisor stands to benefit from the spinoff in many ways. We’ll be a truly independent business, but that is not any different from how we’ve generally operated in past. The management team is the same, pre- and post, and we have not been restricted in what we are able to do. From a customer perspective, we expect to establish even closer relationships with many of our major clients, because we are no longer a subsidiary of one of their competitors. We believe we will continue to be an attractive employer, perhaps even more so, given that we will no longer be Expedia’s subsidiary.
We will be able to recruit brilliant talent to join the mother ship itself. We believe the TripAdvisor brand is strong and recognisable, and with our own ticker on Nasdaq, we believe we can generate even more brand awareness. We’ll be a publicly traded company. We’ll be able to create shareholder value for our new TripAdvisor shareholders as a pure play, not just part of the mix. We’ll have our own board of directors. This highly sophisticated and experienced group of individuals will be singularly focused on us and our success.
What was the idea behind the whole spinoff exercise?
The key reason is to unlock shareholder value for both TripAdvisor and Expedia, by focusing on the core business. As the world’s largest travel website, with more than 50 million unique monthly visitors, TripAdvisor is the definitive resource for travellers and a critical partner for merchants. We continue to see a huge and growing opportunity in the market; and operating as an independent company will enable us to focus on capitalising on every opportunity.
What are the checks and balances you put in place to ensure fairness in the content on TripAdvisor?
The integrity of the content on TripAdvisor is fundamental to our success. Without it, we wouldn’t have the loyalty we enjoy from the more than 50 million visitors who use our site each month. As such, we take the authenticity of our reviews very seriously and have numerous methods to manage the legitimacy of the content on TripAdvisor. We use sophisticated automated tools that help flag questionable content for review, and our large and passionate community of millions of travellers keeps an eye out on our site as well. We also have experienced quality assurance specialists, who spend thousands of hours every year to help ensure the integrity of content on TripAdvisor.
