Expedia cracks $1 billion barrier
Expedia will spend more than US$1 billion on sales and marketing this year, the company said.
The global online travel giant is moving to capitalize on the strong sales momentum it has generated over the past 18 months, says Travel Trends.
The company is now spending more than 40% of its revenue on sales and marketing – US$283.4 million in the first quarter alone or 29% more than the previous year.
Expedia will continue turning up the marketing volume.
The marketing volume will not let up “as we continue to support our established brands and geographies, experience continued keyword inflation, invest in our global advertising and media businesses, and expand our various sales teams,†said CEO Dara Khosrowshahi
He said most of the sales and marketing budget is spent on “traffic generation costs from search engines, brand advertising (primarily television) our private label and affiliate programs†while around 22% goes on staff and other indirect costs.
Expedia has also experienced strong growth in advertising on its own sites like TripAdvisor.
In the first quarter Expedia websites generated US$64million in advertising and media revenue, up 73% over the previous year.
“While 50% of US travel is purchased online, just 8% of travel advertising is directed to the internet … we expect this gap to narrow over time,†he said.
Report by David Wilkening
David
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