Booking CEO Glenn Fogel wants you to take out your travel frustrations on AI chatbots
Aug 5, 2024
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Glenn Fogel, CEO of Booking Holdings, shares insights on the travel industry, emphasizing the challenges post-pandemic and the competition from both hotels and airlines. He discusses how Booking.com is adapting to AI, aiming to enhance customer interactions while maintaining a personal touch. Fogel also addresses the complex regulatory landscape affecting competitive practices, particularly the influence of tech giants like Google. The conversation highlights the evolution towards data-driven decision-making, showcasing how AI could reshape travel experiences.
Booking Holdings has strategically acquired several travel brands, enhancing its portfolio while allowing each to maintain operational independence within a unified framework.
Despite regulatory scrutiny as a classified gatekeeper in the EU, Booking.com continues to navigate competitive dynamics by demonstrating its value to customers and industry partners.
AI technology is integral to Booking's strategy for improving customer service, yet complexities in travel disruptions still necessitate human intervention for effective resolution.
Deep dives
Overview of Booking Holdings' Structure and Brands
Booking Holdings operates a diversified portfolio of well-known travel brands, including Booking.com, Kayak, OpenTable, and Priceline. Despite the variety of brands, Booking.com remains the dominant subsidiary, accounting for roughly 90% of the company's profits. The company has grown significantly over the years through strategic acquisitions, absorbing smaller competitors to create a more robust service offering. This structure allows each brand to maintain some independence while benefiting from shared strategic resources and best practices.
Understanding the Role of Online Travel Agencies
Online travel agencies (OTAs) like Booking.com serve as intermediaries in the travel industry, providing value by organizing information and enhancing customer convenience. Unlike airlines and hotels aiming for direct bookings, OTAs facilitate access to a broad array of travel options without directly operating hotels or airlines themselves. The CEO expressed that even major hotel chains benefit from OTAs, as they often lack the infrastructure to handle multilingual customer service or multiple payment methods. In this capacity, Booking.com positions itself as an essential agent for travelers, navigating the complexities of booking and customer support.
Impact of Regulations and Competition in Europe
In recent years, regulations like the EU's Digital Markets Act have classified Booking.com as a gatekeeper, subjecting it to certain competitive provisions similar to those affecting larger tech companies. Although the CEO has expressed discontent with this classification, he acknowledges the potential for a more level playing field against competitors like Google. The conversation highlighted that while regulatory pressures exist, competitive dynamics remain intense, and Booking.com must continually demonstrate its value to both customers and partners in an evolving landscape. The company's growth is challenged by situations where it must adapt to regulations, particularly regarding pricing parity agreements with hotels.
Incorporating AI into Customer Support
AI technology has emerged as a significant focus for Booking Holdings, particularly in enhancing customer service capabilities. Current applications include AI solutions that can handle simple queries, which are intended to reduce wait times and improve overall customer experience. However, more complex scenarios, such as those occurring with travel disruptions, still require human intervention due to their multifaceted nature. The CEO remains optimistic about the future of AI and its potential to streamline customer support and ensure service reliability, but acknowledges that substantial progress is still necessary before these systems can function at an advanced level.
Future Prospects and Growth Opportunities in Travel
The future of travel remains promising, with a long-term trend of consistent growth expected to surpass global GDP rates. As economies recover post-pandemic, the resurgence of travel demand is anticipated to create new opportunities for Booking Holdings to capture an even larger market share. The company's strategy is to utilize technology to provide improved travel experiences while tackling challenges related to sustainability and over-tourism. This proactive stance involves not only meeting current travel needs but also anticipating potential issues arising from increased travel popularity and addressing them strategically.
Today, I’m talking with Glenn Fogel, the CEO of Booking Holdings, which owns a large portfolio of familiar travel brands: OpenTable, Kayak, and Priceline, as well as its largest subsidiary, Booking.com. This episode is pure Decoder bait all the way through — from Booking’s structure, to competition with hotels and airlines increasingly going direct to consumer, even to how European regulation affects competition with Google. Oh, and of course, how Booking is incorporating AI; Glenn has some fascinating thoughts there.
Glenn really got into it with me — there’s a lot going on in this space, and it’s interesting because there are so many players and so much competition across so many of the layers, even among Booking’s own subsidiaries. I think we probably could have gone twice as long.
Links:
The oral history of travel’s greatest acquisition | Skift
Long-term travel looks like a strong growth industry, says Booking’s Glenn Fogel | CNBC
Ryanair wins screen-scraping case against Booking.com | Airways
