Skift Travel News Blog

The problem surfaced in late Summer — Booking.com’s short-term rental hosts in Europe, Asia-Pacific and Latin America cited financial hardships because the company wasn’t paying them for guest stays.

A condo hotel that was listed on Booking.com. Source: Booking.com

CEO Glenn Fogel told financial analysts last week during Booking Holdings’ third quarter earnings call that Booking.com would begin letting partners know that compensation is on the way.

Missed Host Payments

“During the quarter, some of our partners at Booking.com experienced delayed payments due to a planned upgrade to our finance and payment platforms in early July,” Fogel said. “We’ve now cleared the backlog of outstanding payment issues related to the system upgrade. We plan to provide compensation to partners who experienced an extended delay, and we recorded this in our Q3 results. We plan to communicate to all partners who were impacted by these payment delays within the next few days.”

The company won’t specify precisely how much it would be shelling out to hosts as compensation.

A spokesperson said the amount of the payments are “meaningful, not material.”

In-House Payment System Is Strategic Priority

When the reports of missed payments for hosts first surfaced several months ago, the company downplayed the issue.

But in addition to the financial pain it inflicted on hosts, the snafu was an embarrassment to the company because it has been developing its own payments system over the last few years as a strategic imperative.

Pain for Hosts

Fogel discussed the issue with this reporter at Skift Global Forum in September.

Fogel: We did a very, very large change in our backend financial systems. Some things didn’t work so well. You do everything you can to make sure it’s going to be perfect. Wasn’t. Some people didn’t get paid a very, very, very small percentage. But even one person is one too many.

We have two types of customers. We’ve got the travelers and we’ve got the partners. And if we don’t provide good service to them, that’s on us. We screw it up, and there were mistakes. And if you don’t pay a very large company so much, well, it’s not a big deal.

By the way, in our agency business where we get paid by the partner who sends us money afterwards our commission, sometimes we don’t get paid on time either. So 30 days late, 60 days late, 90 days late, and during the pandemic, we didn’t get paid at all. Happens. This is not a pandemic, this is a mistake. And the thing is, for the smaller partners, partners that were really depending on that payment, I just felt so horrible.

Schaal: What kind of redress can you have for them?

Fogel: First thing is get their money as fast as you can, as fast as you can. And I’ll tell you, I get emails and I’ve read them and they are really heartbreaking. You just feel horrible when you do something wrong. And we have fixed it, it’s good now. But I’ll tell you, this is something where I say to the team, and I say that … I spoke out at a town hall for all of our 20 something thousand employees.

And I told them about this. I said, “Look, this is not the way we want to be. We got to do better. We should not ever, ever feel that this is OK.” Well, it’s only a small number of partners. That’s the wrong attitude. It’s always got to be, every partner counts. So the lesson from it was we have to do better.

Booking.com hasn’t announced a deal to launch a co-branded credit card in the U.S., but a LinkedIn post Tuesday by a relatively new employee and a job opening for “manager, co-branded credit card growth & strategy,” provided grist for speculation.

In the LinkedIn post, Jonathan Rossman, whose position is listed as “co-brand credit card at Booking.com,” said he’s hiring team members and asked people to reach out if they are “interested in helping to build and grow a unique and differentiated cobrand product” at Booking.com.

Rossman, who has been at Booking.com for nine months, according to his LinkedIn profile, did previous stints at JPMorgan Chase, American Express, and British Airways.

He linked to a Booking.com job posting for manager, co-branded credit card growth and strategy, which the company described as “a new role being created to launch and manage Booking.com’s upcoming co-branded credit card in the US, a top priority market for the company.”

Booking.com tried its hand at travel inspiration. Source: Booking.com

Booking.com has been pushing for the past few years to get stronger in the U.S. It will need a partner for a co-branded credit card and it’s unclear who it will be.

One possibility? Booking.com kicked off an important partnership with Citi last month when the Amsterdam-based online travel agency and sister brand Rocket Travel began powering a newly launched Citi travel site for cardholders, CNBC reported. Booking provides flights, accommodations, rental cars, and tours and activities for the portal.

Booking.com, which has marketing relationships with the International Cricket Council and the Union of European Football Associations, is playing ball with Major League Baseball.

The company will officially announce today that it has become Major League Baseball’s official online travel partner. Among travel-related services, the league also counts MGM Resorts and Capital One, which offers Capital One Travel, as official sponsors. Marriott has also been a partner.

Booking.com declined to release financial details of the marketing partnership, but said fans will begin to see Booking.com branding in baseball stadiums across the U.S., and there will be a new media campaign getting under way in several weeks.

With the launch, the official schedule pages of Major League Baseball teams will feature Booking.com icons that direct people to search and book accommodations near stadiums.

A recent Booking.com survey found that 49 percent of U.S. baseball fans plan to travel to at least one game in 2023, and 61 percent would be open to traveling as far as 500 miles to see teams play.

Booking.com, based in Amsterdam, has been making significant inroads in the U.S. market, trying to challenge Washington-based Expedia as the market leader.

Booking Holdings CEO Glenn Fogel cited the “explosion of interest” in generative AI (artificial intelligence), but counseled that it would be prudent to be patient about delivering on its promises.

“But it’s important to remember that disruption has never been built in a day, and lasting innovation is iterative,” Fogel wrote on LinkedIn. “At Booking Holdings we have been using various types of AI across our brands for over a decade to remove friction from the travel process and our teams continue to explore what the best uses of this new transformative technology might be.”

Fogel cited the challenges, including reliable data sources, in turning artificial intelligence and related technologies into a better travel experience.

“I believe that generative AI and other technologies will play a key role in this new travel world, and many of us in the travel industry are investing right now to build the foundations,” he said. “However, there are going to be significant challenges. The problems of how to obtain real-time data from countless sources, process it all to result in optimal solutions, and then act rapidly to benefit consumers will not be solved overnight. Nevertheless, this is just one area, among many, where we are going, and travel will be better when we arrive.”

Fogel’s LinkedIn post was a tad more diplomatic than his comments last month when he discussed generative AI during the company’s fourth quarter earnings call.

“Obviously, a lot of hype about AI right now, about generative AI,” Fogel said February 23.

Citing a “hype cycle,” and Booking’s long-time work in artificial intelligence, he said: “I’m not sure — I don’t think we’re into that froth of dissolution yet.”

It’s tough for a National Football League team to make a return trip in two consecutive years to the Super Bowl, but online travel company Booking.com will be doing just that with a fourth quarter advertisement during the telecast.

Here’s the advertisement:

Booking.com Chief Marketing Officer Arjan Dijk announced on LinkedIn that the Amersterdam-based online travel agency would run a spot for the second year in a row featuring its Booking.yeah tagline. Melissa McCarthy, who’s won Emmy Awards and been nominated for Academy Awards, headlines the advertisement, and whimsically touts the wonders of stays at hotels and short-term rentals when booked on Booking.com.

Booking.com revived its Booking.yeah campaign in 2022. It had been dormant since 2013.

Booking Holdings sister brand Priceline.com will be launching a new campaign during the 2023 Super Bowl pre-game show February 12.

One might say, Priceline.yeah.

Google made changes to Google Flights and Hotels related to transparency in hotel reviews and pricing under pressure from the European Commission — but stopped short of making those modifications elsewhere in the world.

At the behest of the European Commission, Google added text in hotel reviews in European Union countries, noting “Reviews aren’t verified.”

Unlike online travel agencies, Google doesn’t take bookings so it would be hard-pressed to verify user reviews. Tripadvisor, likewise, doesn’t verify hotel reviews for the same reason.

Clicking further into Google’s explanatory language about user reviews in Europe, Google states that it accepts reviews from signed-in users — there’s no requirement that they ever stayed at that particular hotel — and licenses reviews from third-parties. “Google doesn’t do any additional filtering for spam or inappropriate language beyond that done by the provider, nor do we verify these reviews,” Google states.

The European Commission stated that Google accepted this disclosure about hotel reviews and additional transparency commitments that other hotel-booking platforms such as Expedia Group and Booking.com agreed to on pricing and availability.

“The commitments made by Google are a step forward in this direction. We call on Google to comply fully with  the Geo-blocking Regulation, ensuring that consumers can enjoy the same rights and access the same content, wherever they are in the EU,” European Commission Commissioner for Justice Didier Reynders in the announcement statement.

Google agreed to these changes about user reviews, consented to disclose that Google Flights and Google Hotels is merely a middleman, and agreed to provide greater clarity when presenting discounted pricing, explaining that such deals are merely a reference point. But Google decided to make these changes in Europe only — and not in other geographies around the world where regulators were not providing heat.

“As part of our ongoing dialogue with the European Commission and the EU’s Consumer Protection Cooperation Network, we have made changes to our products that provide a clear benefit and protect consumers,” a Google spokesperson stated. “We appreciate the partnership on this topic and are open to constructive dialogue with all consumer associations and regulators.”

Google’s hotel reviews in the U.S. and elsewhere in the world have no added language explaining the reviews are not verified. So travelers might erroneously believe that everyone writing reviews about these hotels actually stayed a night or two there.

Google frequently talks about helping travelers and other consumers to discover information as being one of its top priorities. However, the search engine giant, perhaps in the interests of providing a cleaner user interface that wouldn’t get in the way of users clicking on hotel ads, sacrificed transparency for expediency in the rest of the world.

Google is not alone in doing what regulators demand in one geography, but not expanding it to other regions for the good of consumers. For example, for several years Airbnb has shown the total price of stays, including taxes, up-front in the European Union at the urging of the European Commission. However, it was only this year that Airbnb became displaying the total rate, albeit without taxes included, instead of just the nightly rate without fees at first glance, in other geographies.

FareHarbor, the Booking Holdings’ tours and activities reservations tech platform, has a new CEO, Skift has learned.

Andrea Carini, who served as vice president of product development at fashion retailer Otrium for the past 10 months, began carrying out his CEO role at FareHarbor this week. There has been no public announcement about the hiring.

For nearly 10 years and up until April 2022, Carini was vice president of product development at Booking.com.

Carini replaced Ted Clements, who was acting CEO at FareHarbor for one year, until October 2022. Clements this month became CEO of WeTravel, an Amsterdam-based travel booking and payments platform.

FareHarbor takes offline tours and activities, and brings them online with a variety of booking services and payment tools.

Travelport is planning to sell its Hotelzon division to corporate travel agency startup TripStax, which was officially launched earlier this year — by two former execs at Travelport.

Hotelzon claims to offer 1.5 million properties from multiple content sources that include Booking.com and Expedia, and says it has 370,000 users, including travel agencies, corporations and event management companies.

It was established in 1972, but has been a wholly-owned subsidiary of Travelport since 2014.

TripStax signed the agreement to acquire Hotelzon as of Dec. 1 2022. Terms of the deal were not disclosed, but TripStax said the agreement establishes a “long-term strategic relationship between TripStax and Travelport whereby Hotelzon will continue to generate hotel bookings on Travelport+.”

Travelport has been streamlining its technology since it announced Travelport+ in April last year.

Skift first revealed the development of TripStax as a spin-off from corporate travel agency ATPI in July 2021. TripStax’s investors include Intermediate Capital Group, which is one of ATPI Group’s owners. ATPI also made a significant investment, with ATPI CEO Ian Sinderson joining TripStax as a director.

Jack Ramsey, CEO of TripStax, was previously global sales director at Hotelzon.

The Unbundling Trend

TripStax said the acquisition will boost its technology offering of “connected proprietary business travel modules with a fully integrated hotel booking tool for agencies and corporates direct.”

The travel agency startup wants to stand out from the crowd by offering modules, such as analytics, content and traveler tracking, rather than a full service. Corporate travel agencies are under growing pressure to separate their bundled services as company travel managers look to cut costs and add flexibility.

Hotelzon will be integrated as an additional module.

It is the second acquisition made by TripStax, following its purchase of TapTrip earlier in the year. TapTrip also received investment from ATPI.

“Since its conception, TripStax has been on the look-out for acquisitions which add relevant and complementary tech to its already powerful stack of business travel management modules,” said Ramsay. “We are also excited to welcome the hugely experienced Hotelzon team to the TripStax business and plan to further invest in the team to strengthen existing customer and supplier relationships and realise the full potential of this joint opportunity.”

UnderTheDoormat Group CEO Merilee Karr said her company’s new technology and distribution agreement with Visit Oman can be a novel approach to short-term regulation — one where technology can spur governments to embrace the sector rather than shun it.

Through an agreement signed last month in Muscat, Oman, government-approved property listings delivered through the UK’s UnderTheDoormat Group’s Hospira property management and distribution platform were live in November in time for the World Cup in Qatar.

Oman already offered had short-term rentals through hotel licenses and from a variety of players on big global platforms such as Airbnb and Booking.com.

But Karr said the tech partnership breaks new ground, officially opens the market, and provides Oman with the transparency it sought about an otherwise-fragmented sector.

Property developers, hospitality companies, small- and medium-size enterprises (SMEs), and eventually individually owned short-term rentals that are licensed can connect their properties through Hospira to access the market, and the major global platforms, she said.

The Visit Oman-UnderTheDoormat Group pact is exclusive, Karr said.

Like others in the Middle East, Oman is trying to develop a more diversified tourism economy.

“Through the Visit Oman gateway, the Hospiria platform will provide an efficient launching point for Omani companies, SMEs, and property owners to place their apartments, villas and homes onto the short-term rental market globally,” said Sahib Al Mamari, managing director of Visit Oman, as part of the announcement. “This latest Visit Oman initiative with UnderTheDoormat falls in line with the broader, existing Oman Tourism Vision 2040 strategy, and serves to shift the Sultanate of Oman towards a more diversified and developed tourism economy, and one that leverages digital innovation and technology to maximize value for the Omani tourism market, as well as the tourism-related SME economy in Oman.”

Booking Holdings is hiring rapidly at its new engineering office in Bengaluru, India, to work on new projects such as how to verify guest identification with machine learning and new products such as alternative forms of international payment to traditional credit and debit cards.

The parent company of Booking.com has about 20 employees at its tech center now but expects to ramp that up to about 100 by year-end, according to The Times of India. The business unit will work on how to use artificial intelligence and machine learning to better manage risks and hassles in travel transactions.

The company wants to verify IDs such as passports and driving licenses by linking the company to sources of identification data and using artificial intelligence and machine learning to scan these and verify identities automatically.

That is one of the projects that the Bengaluru office will tackle, Daniel Marovitz, senior vice president of fintech at Booking.com, told The Times of India.

The team will also look at possibly building a “foreign exchange card” as an alternative form of payment to a traditional credit or debit card. Today, many credit and debit cards charge a different, higher foreign exchange rate than the lowest available on the market.

The planned Booking.com product would attempt to offer a cheaper alternative. The ambition is for customers to use the card, which will come in physical and digital forms, for routine purchases and not just for booking a hotel. It may eventually enable customers to take advantage of buy-now-pay-later and other insurance-like products that Booking Holdings might operate on its own as a financial technology player.

Both projects fit with Booking Holdings CEO Glenn Fogel‘s vision for “a connected trip” that he laid out at Skift Global Forum in September (see video).

The news of the product testing and development dovetails with recent Skift Megatrends about the financialization of travel and how the rise of global mobile wallets are upending travel payments.