Darren Huston at the ITB Berlin Convention

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CEO Darren Huston Talks Direct Booking, HomeAway
and Unicorns
https//skift.com/2016/03/09/priceline-group-ceo-t
alks- direct-booking-homeaway-and-unicorns/ Pri
celine Groups attempt to build an effective home
rental product is proving a challenge, but CEO
Darren Huston maintains the company had no
interest in acquiring HomeAway because of its
business model and the high cost. At the ITB
Berlin Convention 2016 this morning, Priceline
Group CEO Darren Huston said hes annoyed by the
efforts of hotel brands to push back against
online booking sites.
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The conversation with Phocuswright founder Philip
Wolf, which included a discussion of Priceline
Groups operating structure, allowed Huston to
provide his candid assessment of why he had no
interest in acquiring HomeAway before its sale
to Expedia last year. On both fronts, Pricelines
relationship with hotel chains and its decision
not to attempt to acquire HomeAway, Huston was
elaborating on remarks hes made over the last
few months.
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Huston also questioned the viability of
ridesharing giants as they begin to mature. Here
are the highlights from Hustons comments. Huston
on hotel brand advertising that encourages
consumers to book direct We spent 2.8 billion
in 2015 advertising dollars finding demand,
and ads from hotel brands are not an effective
way to tell a customer how to go through the
internet. Im a little skeptical, because the
best way to reach people is to create a better
experience. I find it annoying, because it is a
business relationship and we bring guests to
them. Only two percent of travelers stay in the
same hotel twice. The challenge is that not
every city is like St. Louis, where 90 percent of
properties are branded brands have a role in
the world, but if the hotel experience is
differentiated online people will book it. The
internet is so democratic and punishing of bad
experiences, but at the same time it rewards
great experiences.
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Huston on why Priceline Group let HomeAway sell
to Expedia in 2015 Were trying to make
booking an apartment as easy as booking a hotel.
The problem with the HomeAway and Airbnb model
is that they charge users fees and theres a
whole back and forth before the transaction.
Were trying to build a different model, but the
vacation rental space is the hardest yet to
crack. Were trying to convince homeowners to
not take deposits or charge insurance We would
have been interested in HomeAway about five
years ago, but we had no interest today. Huston
on the fate of ridesharing unicorns Uber
and Blablacar Everything goes through a
lifecycle. The real question is whats the
sustainable business model for these companies.
A real business is up to the cash flow you make,
and if theres no model at the end of the day,
things will fall out. A lot of ideas do come
through that unicorn space, but eventually
every one of these companies has to grow up.