As the coronavirus infiltrated communities around
the globe and human movement came to a screeching halt, travel industry
companies of all sizes took an abrupt and profound hit.
Bookings and revenue plunged – upwards
of 90% in many cases – and travel executives scrambled to find ways to pay their
bills without going under.
One of those executives, the CEO of a large
online travel search and booking platform founded more than a decade ago who
spoke to us on the condition of anonymity, says one of the first things he did
was to talk to his Google account representatives, since the company had “fairly
significant” invoices outstanding from the first quarter of 2020.
He proposed a payment plan for the outstanding debt,
and asked Google to continue to keep his accounts live so his company could
capture new business as travel resumed.
The response he got from Google was a surprise.
Not only did the tech giant – whose parent
company Alphabet had revenue of $38.3 billion in the second quarter of this
year, just a 2% drop off the same period in 2019 – reject the payment plan
without offering an alternative, he says it also froze his company’s ad accounts and enlisted
the help of Accenture to collect payment.
In response, a Google spokesperson says only a
handful of travel companies have issues around payment collection – and those
that are seeking relief are asking for preferred treatment from the search giant.
“We fully recognize the enormous challenges
facing the travel industry, and we’ve been working in close collaboration with
travel advertisers to help them protect their businesses and look toward
recovery. The issue of payments collection applies to only a very small number
of travel companies, and virtually all of our partners in the industry do not
have overdue bills with us.
“As a matter of fairness, we’re applying the
same rules equally to all of our clients asking for relief, across both travel
and the many other sectors that’ve been impacted by the pandemic."
However, the travel executive affected sees it
“Given the billions of dollars in profits that
Google has extracted from the travel industry over the years and given the
anti-trust spotlight currently on them, if they were smart they would be making
a grand gesture to support the travel sector through this period, not playing
hardball with businesses that are fighting to keep the lights on and to keep
making payroll,” he says.
“If Google isn't careful they'll wake up one
morning and the only travel advertisers they'll have left participating in
their auction will be Booking and Expedia.”
In contrast, he says he received a much more
collaborative response from “a big Chinese tech company with whom I had to have
a similar conversation in March.”
That company, he says, has “gone out of their
way to help drive additional revenue for us and have not been constantly
chasing us for payment. This is what a real partnership looks like, and I know
who we're going to be paying off first.”
This CEO says he feels fortunate that his
company is not as dependent on paid search as others in the industry, but
having the Google channel shut off is a “handicap” that will also delay “the
time it’s going to take for us to be in a position to pay them back.”
Several German travel companies are experiencing
similar frustrations with Google. According
to a report from CNBC, GetYourGuide, Trivago and HomeToGo say Google has
also taken a tough stance with their outstanding bills since the beginning of
the pandemic, demanding payment and threatening to suspend their accounts.