Hotel metasearch platform Trivago says increased awareness of
the brand and strategic TV advertising have helped push annual revenue above €1
billion in 2017 – the first time the Germany-based company has hit that
milestone.
The figure marks a 37% increase compared to 2016.
2017 was Trivago’s first year on the Nasdaq after its initial
public offering in mid-December 2016. Expedia has held a majority stake in
Trivago since 2012.
Revenue in the fourth quarter increased 7% compared to a year
earlier, to €181.5 million. In the same period, revenue share from mobile
websites and apps continued to exceed 60%.
For
the fourth quarter, the company reported a net loss of €9.6 million compared to net income of €0.1
million in the fourth quarter of 2016. But year over year, net loss decreased
to €13.0 million in 2017 compared to €51.4 million for 2016, which Trivago
attributes to a significant decrease in share-based compensation expenses.
Trivago
also reported a loss of €8.7 million in adjusted EBITDA for the fourth
quarter of 2017. For the full year of 2017, adjusted EBITDA was a positive €6.7
million, compared to €28.2 million in 2016.
Internal and external factors
The
company says adjusted EBITDA was negatively impacted by lower "levels of
commercialization" on its platform, increased advertiser testing activities in
the second half of 2017 as well as an increase in its own advertising spend.
In other words, Trivago has invested large sums in its own brand advertising as it has extended its successful TV strategy using the "Trivago Guy"-style commercials in local markets.
The strategy to bring in more users in the front door comes, as noted in the earnings report, as some of the site's big backers, such as Booking.com, have looked elsewhere (their own TV and digital marketing) to offload their adspend.
Still, qualified
referrals - defined as a unique visitor per day that generates at least one
referral – increased by 36% in 2017, to 727.1 million.
Operational
updates in the past year included growth in Trivago’s alternative accommodation
inventory – to more than 250,000 properties – following the integration of
HomeAway.
The company also reports other revenue grew by 59% in the fourth
quarter and 81% for the full year, mainly due to an increase in subscribers to
Hotel Manager Pro.