Expedia has been flexing lately, demonstrating its powerful stance in the travel market and offering a glimpse as it strengthens its vulnerabilities against its main competitor, Priceline. Take a look at their recent acquisitions:
Wotif (July 2014): Wotif is a huge player in the Oceania market, especially Australia and New Zealand, markets where Expedia has little penetration. More info...
Travelocity (January 2015): Travelocity is a strong brand that was struggling with new customer acquisition while keeping its back end robust. It was becoming a thorn in Sabre's side, so to speak. Initially, it had some partnerships with Expedia, and eventually, Sabre sold the entire brand to Expedia, giving Expedia a larger share of the American pie. More info...
Orbitz (February 2015): The Orbitz acquisition was an industry shocker; however, it shows that Expedia needs to maintain its US market dominance, no matter the cost. More Info...
What Expedia is particularly worried about is Priceline's breadwinner, Booking.com. Booking started in Europe and then expanded globally, and is undeniably in more markets than Expedia. Currently, Booking is making significant strides in expanding into the US market, boasting a formidable on- and offline advertising budget (see more here). Booking alone caused Expedia to shift from its more lucrative merchant model to an agent-based model, without giving them much credit, and even lowered the commission rates (see more about that here). Now, Booking is launching a full assault on the US market, with a year-over-year growth of 17%. If you look on their jobs site, WorkatBooking, you can see they are expanding rapidly, opening new offices and building teams all across the US.
It is apparent that Expedia has decided to counter their success and hold on to their US market share by gobbling up other players, like Travelocity and Orbitz. Another counter is that Expedia is expanding offices and teams in Europe, Booking's home turf. If you look on their hiring site, LifeatExpedia, you can see more global jobs than ever offered before. Expedia has finally expanded its inventory, now including hostels bookable on their site, which can perform really well in Europe, where hostels are increasingly popular. This is something Booking has done almost from the start, so the competition can get interesting, boasting even more non-hotel accommodations than the other hotel OTAs. The battle will definitely continue between Booking and Expedia. Priceline has been making moves outside the accommodation OTA sector and is focusing more on travel products and hotel services as well. Expedia is still late to the game on this one, but there are plenty of tricks left up their sleeve. There are many companies out there that can really add value to each of these players, and everyone is excited to see what happens next.