Priceline puts innovation first
Sometimes you innovate, sometimes you acquire the innovator and sometimes you follow the innovator. But what matters, says a senior executive at Priceline is that innovation is central to your strategy. Pamela Whitby hears why.
If Todd Henrich, Senior vice president, Corporate Development at Priceline, knew what would be the big disruptors to the travel industry this year he would, by his own admission, be a very powerful person. That said, while these things are very difficult to predict, Priceline is constantly on the lookout for innovation and disruptive forces because this, he says, helps show the company how it can improve. “We’ve built our business on the back of innovation – for example ‘Name Your Own Price’ and, most recently mobile – and not all of those were our innovations,” he says. “Sometimes we’ve been the innovator, sometimes we’ve acquired the innovator and sometimes we’ve followed the innovator. The challenge is keeping your mind and your business open to innovation.”
Priceline’s acquisition of Kayak late last year and consequent rise of the mega metasearch category is a case in point. The ‘mobile’ piece of Kayak’s business was a key driver for the Priceline acquisition. With mobile now becoming mainstream and growth opportunities in emerging markets (where mobile is a huge opportunity) this is something that will continue to be a focus.
As such Priceline Ventures is constantly looking to invest in companies that will drive big innovation. But for Henrich, who will be speaking at EyeforTravel’s Online Marketing Strategies for Travel 2013: The Americas & The Caribbean in Miami (June 4-5) most of the things we have seen recently have been innovations on the margin. “They have sought to improve things incrementally rather than transformatively,” he explains. However, people are working on things that could be fairly transformative – an example would be voice-enabled search. Of course there are “tonnes of challenges there, but the opportunity is significant,” he says.
In an interview with EyeforTravel last year Henrich, who has now been with Priceline for over nine months, touched on the importance of getting attribution models right. So are we any closer to doing so? “I’m not sure,” he says, “though there is increasing pressure to do so.” Admittedly there has been a fair amount written about declining returns on investment in traditional search and as this continues there is increasing pressure on marketers to spend ever more efficiently. “Understanding attribution is an important element of that,” he says.
Getting it right
According to Henrich, related to attribution is the integration of a consumer’s experience across various screens. The challenge now is optimising a customer’s experience for the device they are on and at the same time making their experience between screens as seamless as possible. “It’s a big opportunity and critical for big brands like Booking and Priceline to get right,” stresses Henrich.
When it comes to understanding their customers, travel brands are getting warmer. “I certainly think ‘big data’ is playing an important role in enabling us to not only understand who our audience is, but when and how to interact with them,” he argues.
Of course, many customers are active users of social media but Henrich still thinks that social hasn't been particularly effective at driving bookings. “Facebook is constantly innovating and are offering some capabilities that show promise,” he says, “but the challenges in social generally still remain: achieving strong conversion at scale in a way that absolutely respects consumers’ privacy.”
For more insights from Todd Henrich, Senior Vice President, Corporate Development at Priceline join us in Miami for Online Marketing Strategies for Travel 2013: The Americas & The Caribbean (June 4-5)