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Mathilde Charrier

on 16 April 2014

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Transcript of Trivago

How are information technologies being used to create this innovation?
Trivago uses different IT to create this innovation :

- A
search engine with a robot indexation
that looks through 110 hotels partners websites such as opodo, getaroom, expedia, agoda, lastminute, in
order to build databases of contents.

A raking algorithm
that take into account:
• grades and advice to the partners and on Trivago website
• the latest update
• the rate of hotels’ occupation
• the fact to proposer an offer or new items about hotels

- A
raking widget and an evaluation widget
are uploaded on hotels website:
• to display grades and ranks
• to post customers advice
• to be all the time connected to Trivago

How is the firm likely to generate revenue through this innovation? What is the basis of its profitability?

--> Expadia (NASDAQ) acquiered Trivago in 2012.

- No money from consumers or advertising.
-Unique source of revenue : announcers pay trivago for having transferred users to their official website.

- Hotel booking is the most important division in the company’s portfolio of Expedia (66%)
- Hotel booking offer around 23% revenue margin (23%) which makes it the most profitable division, compared to airlines (3%) and car rentals & cruises (9%).

What is the likelihood that this innovation is sustainable? Will it have a disruptive effect on the industry? If so, how will the disruption occur?

→This innovation will be sustainable because it proposes a fast, effective and easy to use service. The fact that it is a free service attracts more and more people.

Disruptive effect
on the industry :
- Customers will stop to go to
physical travel agency
: Trivago much more
faster, easier and free
, ensure the
best price ever
, really gives objective opinion on the hotels, provides what the customer is really looking for.
- Increase the competition between the different online hotel reservation websites --> decrease of the prices.

-2 million researches per day
-1 000 billion hotel researches per year
-Trivago get close to 20 million monthly unique visitors on its website = Great visibility
- The turnover has doubled every year since 2008

What is the
nature of the innovation
in the product, service, or offering being created by the firm? How is this “innovation”
unique or innovative
A service innovation.

→ -
Compare the prices
of all the online hotel reservation websites (Agoda, Booking, Hotels.com,…) and
gather all the discount
they propose.
→ -Does an a
verage of the ranks
given by customers in all these online hotel reservation websites.
→ -Propose in priority hotel with a
good average and big discount.

-Founded in 2005.
-The most important hotel price comparison tool in the world = 45 millions of visitors per month.
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