Expedia Partner Conference: innovation, technology, partnership

(LAS VEGAS—Howdy, partners! Exactly the sentiment executives from Expedia Inc. offered the audience at the Expedia Partner Conference here at Caesars Palace.)

LAS VEGAS—Howdy, partners! Exactly the sentiment executives from Expedia Inc.offered the audience at the Expedia Partner Conference here at Caesars Palace.

The theme of the conference, “Travel Rising,” was based off of three main drivers, as Melissa Maher, SVP global partner group, Expedia Lodging Partner Services (pictured), outlined at the start of the show: innovation, technology, partnership.

The key, she said, was partnership. “Without it, technology and innovation are meaningless.”

Expedia Inc. is a multi-platform company, composed of such online travel brands as ExpediaHotels.comVenere.comHotwire and Egencia.

Maher was followed on stage by Expedia Inc.’s CFO, Mark Okerstrom. He gave a broad overview of the travel industry and Expedia’s spot within it. While 2013 offered “mixed signals,” he said, alluding to the government shutdown, which cost the overall economy some $24 billion, $2 billion of which was travel specific, 2014 should be less unclear.

“Travel continues to grow at healthy rates,” he said (it’s up 3.7 percent in the U.S.). “People want to travel.”

It sure seems so for Expedia, where, in the third quarter, gross bookings were up 15 percent, translating into $10.4 billion of revenue.

Expedia is also reaching new pockets of demand; first and foremost, China. “U.S. arrivals are up 25 percent on Expedia points of sale,” Okerstrom said.

In sum, he said that the travel outlook for 2014 is better than 2013. And data say so. Forward bookings, he said, are up 24 percent for San Francisco, 49 percent for Bangkok and 30 percent for Paris.

But Expedia is not resting on its laurels. The company spent a staggering $2 billion in sales and marketing in the last 12 months. “We spend more and more each year,” Okerstrom said.

Next, Dara Khosrowshahi, president and CEO, Expedia Inc., and president of the Expedia brand, discussed changes in travel—particularly how consumers are buying it.

Khosrowshahi noted that travel and music were the two most bought online items. “We continue to change with new devices and technology,” he said. “It’s a wonderful opportunity. What are we doing to stay ahead?” he asked the audience.

Khosrowshahi said Expedia had three assets: brands, people, technology.

He also said that the company has changed how it operates internally. It has to in this quickening age of commerce and technology. “Instead of predicting the future, we build one that is agile and fast. It becomes difficult to predict the future, so we built one that can react to the future. We have stopped guessing what the consumer wants and let them tell us.”

Guessing, no, but trying to figure the consumer out, yes. Expedia does a ton of A/B testing, and Khosrowshahi said that there are hundreds of different Expedia iterations on the Web. So a user logging onto Expedia.com in one place, for instance, would have a totally different experience than a user logging onto it from a different area. This can appear in the way and appearance of how categories are sorted, for instance.

Of course, no travel discussion is finished without mentioning China, which Khosrowshahi said is responsible for 1/3 of the world’s growth. “By 2020, there will be 100 million outbound Chinese travelers,” he said. “We are spending a lot on the international consumer,” he said, adding that Expedia is making large investments in Elong.com, it’s China-targeted OTA.

“China is already twice the size of U.S. market in online use,” he said.

Meta-search was also a topic of discussion, reportedly up 28 percent in use in 2013. “Consumers like to shop around,” Khosrowshahi said.

And of the future? It's all about mobile. "PCs are the minority of connected devices," Khosrowshahi said. "Mobile is up 20 percent in 2013 for U.S. consumer media consumption share."