Global hotel and
accommodation search platform Trivago credits vaccination efforts in markets
such as the United States and Israel with spurring a jump in travel activity that
gave the site a 60% increase in referral revenue – its primary source of
revenue - in March compared to February.
revenue in the first quarter was €36.2
million, down from €136.7 million in Q1 2020.
Europe” segment saw the sharpest decline in referral revenue year-over-year – 83%
- while the Americas dropped 66% and “rest of the world” was down 67%.
In a letter to
shareholders regarding the company’s financial results for the first quarter of
2021, the company says, “We also expect travel demand to gradually begin to
pick up across our developed Europe segment during the second and third quarter
of 2021 when most European countries are expected to make significant progress
rolling out the COVID-19 vaccine.”
In Q1 2021 compared to Q1 2020, Trivago saw an increase in referral revenue
coming from Booking Holdings’ affiliated brands such as Booking.com, Agoda and
Kayak, while revenue from Expedia Group brands such as Expedia, Hotels.com
and Vrbo decreased. The company says Bookings Holdings’ share of referral
revenue was 56% in the first quarter of 2021 compared to 39% in the same period
in 2020, while Expedia Group’s share was 21% in Q1 2021 compared to 33% in the
same period of 2020. Expedia Group owns a majority stake in Trivago.
Total revenue in the
first quarter of this year was €38.2
million – a 73% drop compared to the first quarter of 2020. Adjusted EBITDA was
a loss of €4.8 million in Q1 compared to a loss of €.6 million a year prior.
In the statement, Trivago says, “We expect travel patterns in the months to come, both in terms
of accommodation-type and destination mix, to gradually become similar those
prior to the COVID-19 pandemic. We believe intercontinental travel will likely
remain muted for some time, and we expect city travel, a type of travel that
has historically been one of our strengths, to recover in the second half of
2021 as cities gradually begin to open up for tourism again.”
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capture that increasing demand, Trivago says it is increasing brand marketing
activities, particularly in the U.S. For the first quarter of 2021, selling and
marketing expenses were 61% of total revenue, compared to 80% in the same
period in 2020.
Axel Hefer says the marketing strategy will move beyond the primary channels of TV
and performance marketing to use “different channels for different kinds of
communication,” all with a goal of increasing engagement.
with new marketing efforts, Hefer says the company will continue to launch new
features and products to become “relevant to our users more often throughout they
last week Trivago released a local travel product known as Trivago Weekend to
help users discover weekend getaways close to home. The product is available in
the U.S. and United Kingdom and will be rolled out to additional markets in the
coming months. It’s built on content captured from the acquisition of its acquisition
of Germany-based startup Weekend.com in January.
last week Trivago
launched bookings for tours and activities through a partnership with TUI
Group’s Museument brand. The new “Activities” section on Trivago’s website gives
access to more than 55,000 excursions, activities and tickets in 140 countries.
says despite the pain of dealng with the pandemic, the crisis has been a stimulus
for this type of product innovation.
you accept there are not customers you need to think about future customers.
That is a very, very different way to think about it versus you are in the
middle of your business, and you are optimizing everything 24/7, and you don’t
have that perspective of thinking about a point of time in the future and a
future traveler,” he says.
when asked his opinion of subscription products such as Tripadvisor Plus, Hefer
says that is not something that interests him, in part because he questions if there
can be mass market adoption when the majority of people do not travel regularly
but also because it is counter to his philosophy regarding partners.
way it is implemented it is basically like starting a competitor
to our biggest partners. If you provide unique rates to your users, and you also
take care of the booking and the payment processing, etc., you de facto turn
into an OTA,” Hefer says.
“Our approach is to really
work collaboratively with our big partners, be it Expedia, Booking, Trip.com,
the large hotel chains, and use our strength and use their strength and jointly
optimize the user experience end-to-end. Which is a very different philosophy
vs trying to capture as much of the value add by pushing partners farther out. That
is something we really don’t believe in.”
March 31, Trivago says it offers access to more than five million hotels and
other types of accommodations in more than 190 countries, including more than
3.8 million units of alternative accommodations.