Strong Q3 results bolsters his optimism for the opportunity ahead
After 19 years with Expedia Group, Greg Schulze is still as starry-eyed as he was when he first joined the travel industry as a data analyst in American Airlines.
Now, as the Chief Commercial Officer, he’s taken on a new role that will see him relocate from the US to London, stepping into one of the most influential positions in one of the world’s largest online travel companies.
With a mandate for global expansion, Schulze has his sights set on making Expedia an even more formidable presence worldwide. Speaking at WiT Singapore, he says, “It’s an exciting time for me personally. It’s an exciting time for Expedia, for our industry. Everyone feels like we have so much opportunity, and it’s a great industry.”
His optimism is well-placed.
His boss, Ariane Gorin, last week announced healthy third quarter results with total revenue of $4.1 billion in the quarter, up 3% year over year. But it was the B2B business that was the main driver of growth.
Revenue for the B2B business, which powers travel distribution for more than 60,000 partners including Walmart Plus Travel, Chase Travel, United Airlines and Mastercard as well as corporate and offline travel agencies, was up 18% in the period, hitting $1.2 billion, and B2B gross bookings increased 19% in the quarter compared to last year.
In 2023 Expedia Group’s B2B business accounted for 100 million room nights.
Gorin also expressed optimism about future growth potential. “The B2B business has a massive market. The last set of quarters it’s grown at a very elevated rate. Some of that was Asia that was really coming back. … We believe in this business, we believe it will continue to be healthy, double-digit rates.”
New B2B partners for Expedia Group include Canadian Imperial Bank of Commerce and Microsoft, which has linked its loyalty programme with Expedia for bookings on Bing Travel.
Greg Schulze: “In my simple mind, I think the world has basically a third of travel demand in Asia Pacific, a third in Europe, Middle East, and Africa, and a third in the Americas.”
Around The World In Three Parts
That solid platform gives Schulze the confidence to undertake his mission for global expansion.
He approaches global travel demand with a clear vision, dividing the world into three primary regions. “In my simple mind, I think the world has basically a third of travel demand in Asia Pacific, a third in Europe, Middle East, and Africa, and a third in the Americas,” he explains.
For Expedia, the strategy is to grow across each of these areas. “We absolutely need to be growing in each of those regions. Europe is interesting because we have a competitor there that’s pretty strong, but we have a lot of advantages, too.”
One of those advantages is Expedia’s ability to move travellers across borders, leveraging strong local partnerships. “We send a lot of people from the US into Europe. We have great partnerships with hotels,” says Schulze, adding that even when the company isn’t generating as much demand from Europe, they can still send high-value travellers from the Americas who spend significantly.
Investing In the Middle East and APAC
He is particularly enthusiastic about the company’s recent entry into the Middle East with launches in Saudi Arabia and the UAE. “We launched Expedia in Saudi Arabia and in the UAE. We’ve always had a presence there. It’s interesting how many travellers in the UAE were booking on expedia.com,” he says.
With continued investment, Schulze believes the Middle East can become a significant market for the brand.
Then there’s Asia, a region Schulze is familiar with as he was based in Singapore for about five years. “The Asian middle class is expected to reach 3.5 billion people and make up two-thirds of the world’s middle class by 2030,” Schulze says, adding, “Asian travellers are increasingly exploring new and diverse destinations within the region. People are discovering new destinations and so it’s not just going from Singapore to Phuket, but people are going throughout Thailand. We see that as a really interesting trend.”
Expedia recently unveiled its study highlighting key travel trends in Asia. The key findings were:
- Four in five (81%) mass-affluent Asian travellers report that travel is still a priority despite inflation.
- On average, mass-affluent Asian travellers plan to visit four destinations over ten days for their next international trip, with Japan, the United States, Canada, France, South Korea, Australia, and Germany leading the list.
- They plan to dedicate nearly a quarter of their income to travel in the next 12 months.
- Nearly half seek airline and room upgrades, with two in five opting for first class or business class seating.
Having worked in the region, Schulze though is not naïve about competing in the region where there are very strong local competitors. Expedia has made a couple of attempts to dig deeper – its joint venture with AirAsia was short-lived and now, through a stake in Traveloka, it has a strategic partnership with the South-east Asia OTA.
Asked to rate the level of difficulty of expanding in the three regions, 1-10, 1 being easiest, Schulze ranked Asia at the highest, eight, compared to Europe at six and the Middle East at five.
Local Partnerships and Playing Up The Different Brands
Expedia’s global expansion relies heavily on local collaborations and a diversified brand approach.
Schulze explains that the company tailors its strategy based on regional demand and specific market strengths. “We have great local partnerships (in Asia) – we do the packaging for Cathay Pacific, we power some of the big financial companies here, and partner with well-known travel brands.”
For Expedia, this kind of localisation is essential for growth, particularly in regions like Asia, where partnerships with established companies enhance market penetration.
And having spent the past few years building an integrated tech platform which enables it to power integrated programmes such as its One Key loyalty programme, recently launched in the UK, the group is now leaning into its portfolio of brands to allow it to cater to various customer preferences, with different names leading in different regions.
“We’re leaning into Hotels.com, Expedia, Vrbo and the local brands that we have for holiday homes. That’s going to be really critical for Europe.”
Another engine of growth is the alternative accommodation market although Schulze says, “It’s not alternative anymore. First, we never called it that. It’s a big part of our business and it’s now growing.”
In the earnings call, Gorin spoke about the acceleration of gross bookings in its consumer business “for the second straight quarter driven by continued strength in brand Expedia, Vrbo returning to growth and good results in international points of sale”.
She talked about a focus on integrations between brand Expedia and Vrbo – the company has moved about one million units that had been listed on Expedia to Vrbo, giving the vacation rental platform more inventory in urban areas and suited for shorter stays to appeal to a wider audience.
“We’re meaningfully improving the Vrbo app performance, making the app faster and adding new features to streamline shopping. … we have improved the quality of our existing supply with more discounts for long stays and more flexible cancellation policies,” Gorin said.
The Shift From Transaction-Based to Travel Planning-Inspired and Social
And it is this area of customer-focused product innovation that Schulze called out in his interview at WiT Singapore – how Expedia is improving the travel planning process.
“One of the things Expedia is doing that I’m really excited about is pushing up more – thinking really about travel planning, inspiration, and helping travellers make great decisions about their trip without overwhelming them with too much information.”
This shift from simple transaction-focused interactions to an inspiring, informed planning experience is what Expedia is counting on to set it apart from its competitors.
As travel increasingly intersects with social media, Schulze notes the impact of social influence on decision-making. “Our surveys show that more than half make purchase decisions based on the people they follow on social media. And travel has a big presence there,” he says.
In response, Expedia’s Travel Shops initiative offers a platform for influencers to share and monetize travel content, linking directly from social media posts into Expedia’s booking platform. The group has launched 100 Travel Shops in the US, Canada and the UK.
“What we’re doing is providing a place for influencers to store their content. People can see all the recommendations and actually book the travel.”
Innovation and the “Work That’s Never Done”
This constant innovation and evolution in travel tech is what keeps Schulze motivated and excited about his role.
“That’s the interesting thing about working in technology – the work is never done. We have a lot to do, and we’re excited about the work that we’re doing.”
For example, he said, data analytics has transformed Expedia’s approach to personalistion, enhancing how it tailors experiences for travellers. “We really felt like we were personalising that shopping experience. But I look at the data that we had, the technology that we were using, and we are light years ahead of that now,” he notes.
Schulze’s passion for continual learning also extends beyond data and technology. “I love reading fiction,” he shares. “Yes, those of us in business should be reading business books, but creativity and just forcing yourself to think about these things differently – I think that’s really key.”
