Peter Kern says the OTA is happy to continue spending money with the search engine as long as there’s a level playing field
Explore ’20: Expedia boss favours regulators having ‘a good hard look’ at frenemy Google’
Expedia boss Peter Kern has demanded a level playing field online saying the OTA is in favour of government regulators looking at the practices of its “frenemy” Google.
Speaking during the global travel giant’s annual partner event, this year taking place online and headlined Explore ’20, Kern was asked about the growing influence of Google in travel.
This time last year the scene was set for his accession to the top job at Expedia when former boss Mark Okerstrom set out the increasing impact Google was having on its finances.
A growing sense of the dominant global search engine biting the travel hand that feeds it was backed by other industry heavyweights, including Booking Holdings.
Kern was appointed chief executive in April after Okerstrom’s unexpected departure in December which precipitated a major cost-cutting and restructuring at Expedia.
Kern said this week: “We are in favour of governments having and good and hard look at the practices of our frenemies at Google.
“All we want is a level playing field. We are happy to spend money with them as long as it’s productive and as long as the playing field is fair and good for our business.
“We want a fair fight in the marketplace. We are happy to participate in that and if it’s profitable for us we are happy to continue to spend money with them.”
Kern said brands must have a great connection with customers and a ‘sticky’ product offering and experience that brings them back by offering real value.
He pointed out that the group also supports other travel firms, with its B-B partner services, to have their own direct relationships with customers.
Building on this will be what, in the future, enables Expedia and others to avoid the “Google moat”, he added.
Kern was not unduly concerned about the increasingly close partnership between Google and leading US GDS Sabre saying it was about tech and cloud access that Sabre wanted.
He said Google has shown little interest in developing sector specific technology other than generic search and data tools.
“They should give us something for all the money we spend with them,” he said.
But he added the data and insights Expedia is able to provide its partner suppliers far outweighs anything Google is able to offer.
“It’s interesting to know if people are searching for Paris, but it does not tell you if people are transacting, at what prices and when for. That’s what we have.”
Kern said Google has never demonstrated a desire to enter the ticketing area of the travel sector. “I do not think they want to be a true competitor,” he said.
“The question is how much will they intervene in the market to make the market less competitive,” he added.
“But I don’t think they want to be in our business and we will always have the edge in terms of the information we can supply to our partners because we know that customer transacted.
“If we do not take advantage of that then more fool us, but I do not think we are in the same business.”
Kern said Expedia’s move to restructure its business which saw 3,000 roles go before the pandemic hit out it “ahead of the curve” in terms of dealing with the impact of COVID.
“It put us on the front foot. I think we were ahead of the curve and that certainly helped us. We have all had to go deeper and deeper as the pandemic wore on and realities took hold.
“So it certainly was an advantage to go out early. It allowed us to focus on the right things.
“We had a plan of where we wanted to go in terms of our platform and where we wanted to take the business. It gave us a blueprint to move through.”
Kern said the pandemic has had a significant hit on travel in general but nothing that was not expected given the circumstances.
The focus on safety and security will continue for some period, but the vaccines roll out may change that eventually, he said.
But he said different people will have different tolerances of the risk of travel although he expected some sectors of travel to come back quickly.
Expedia’s VRBO holiday rentals brand has benefited from the pandemic as people turned away from hotels, but air, accommodation and business travel have all been hit hard.
However, Kern was optimistic about the prospects. “Given we represent the entirety of the travel business across the broad spectrum, we hope for a broad recovery.
“We have invested our time in improving our technology, improving our customer experience and improving our relationships with our suppliers to make things better coming out [of the pandemic].”