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HomeAll NewsMost read newsBusiness Leaders Biography
Birthday : 02/02/1942
Place of birth : Beverly Hills (Californie) - United States
Biography : Barry Charles Diller is an American businessperson who has been at the helm of 19 different companie

Travel Boom Coming, Expedia CEO Says: 'Hotels Will Come Screaming Back'

04/17/2021 | 07:14am EDT

By Chip Cutter

Peter Kern became chief executive officer of Expedia Group Inc. last April, during the travel industry's worst crisis in decades.

It was a precarious moment: Calls to the company's call centers had surged 500% as consumers canceled flights and hotel rooms. Expedia burned through cash in issuing refunds. To weather the downturn, it scrambled to raise about $4 billion in capital last spring.

Expedia had troubles that predated the pandemic. A strategy clash between its board and management led to the resignations of Expedia's then-CEO and finance chief in December 2019. Barry Diller, the company's chairman, pronounced Expedia on an earnings call as "sclerotic and bloated" as it struggled to compete against Google's growing presence in the travel-booking business. He tapped Mr. Kern, Expedia's 52-year-old vice chairman and a longtime media and private-equity executive, to help him run Expedia's daily operations before appointing him CEO last spring.

Mr. Kern has sought to simplify the company's structure and make its business less reliant on Google search. While cutting thousands of jobs, the company is also gearing up for an anticipated rebound in travel. Alongside the Expedia brand, the company owns Orbitz and Travelocity, along with Vrbo, an Airbnb Inc. rival that has benefited from travelers' desire to rent homes in the pandemic.

Mr. Kern recently spoke with The Wall Street Journal by phone from a home office in Wyoming. Here are edited excerpts:

WSJ: How is the vaccine rollout affecting travel bookings?

Mr. Kern: You see the shift, and it goes geography by geography based on consumer sentiment, what people believe they can do and when. I'm sure you know people who've gotten the vaccine, and they're immediately like, "Oh, my God. Where should we go?" It's just whether people feel comfortable setting a date.

WSJ: Are there parts of the U.S. where consumers have more confidence to book trips?

Mr. Kern: The parts of the country that demonstrated they are less concerned about the virus generally have higher bookings. Chalk it up to politics or perspective or experience or whatever, but that's what we see. It's a personal comfort question, so if you're not worried about the virus generally, if you live in a state where they're more comfortable taking off restrictions, you're likely also more comfortable about travel.

WSJ: Vrbo has been a pandemic bright spot for Expedia as consumers sought to book longer stays close to home. How much of a profit driver will Vrbo be going forward?

Mr. Kern: We're very ambitious with Vrbo. You can't take credit for the tailwinds. These companies that benefited from Covid, they act like they invented nuclear physics, cold fusion or something. It just fell in your lap, and you shouldn't be too proud of that. What do you do with it?

This moment has given us a real opportunity. The demand is so high that we are investing much more heavily in marketing, in supply, in all elements, so we don't lose that moment. And we're getting a lot more users. I also believe hotels will come screaming back and the moment will change, so I don't expect that home rental will be as dominant as it feels right now.

WSJ: When do you expect that to happen?

Mr. Kern: I don't know when we will find the new normal. But you have to think this summer, a lot of hotels will come back strongly.

What we have observed during most of Covid is that booking windows have shrunk, which means people are booking much closer to their actual trip. "Oh, I know I can go next weekend, so let's just go somewhere next weekend as opposed to let's plan three months out."

As we move closer to more pervasive vaccines, people will be like, 'I'm going to do that because I like the pool bar. I like going to the gym at the resort.' All those things that seem crazy maybe today, in a few months are going to seem quite like, 'I can't wait to do that.'

WSJ: What about business travel?

Mr. Kern: Look, business travel will certainly take longer to come back. We are seeing that across the world. But as travel comes back, we will quickly have a phenomenon where, in your industry, when you're able to travel, somebody's going to get on a plane and someone's going to go have that face-to-face meeting, and that meeting is going to be more impactful.

There are a lot of unknowns, but I think the lion's share is coming back. It's really easy in these moments to become a prognosticator and say everything's going to be different. Things don't tend to be all that different.

WSJ: You took this job during a difficult time. Is there a change you made months ago that is now paying off?

Mr. Kern: Honestly, there are a hundred things. It's pace and urgency. We started down a path of simplifying the company and, after I took over, of greatly changing the structure of the company and our technical infrastructure. Both those things are paying significant dividends now and will for a long time.

WSJ: What sort of management advice does Barry Diller give you?

Mr. Kern: Barry's great about really being clear-minded and decisive. When you're changing a company the way we're trying to do now, and getting faster, and changing tech and moving forward, maybe the best advice -- and he gives it regularly -- is just be decisive.

Sometimes, it can be murky. It's just trying to get to a decision, get through it, move forward and get to the next one. That is his superpower.

Write to Chip Cutter at chip.cutter@wsj.com

(END) Dow Jones Newswires

04-17-21 0914ET

Stocks mentioned in the article
ChangeLast1st jan.
AIRBNB, INC. 1.27% 151.58 Delayed Quote.1.96%
ALPHABET INC. -0.17% 2442.54 Delayed Quote.39.60%
DJ INDUSTRIAL -0.21% 33874.24 Delayed Quote.10.91%
EXPEDIA GROUP, INC. 1.21% 168.95 Delayed Quote.26.08%
IAC/INTERACTIVECORP 1.33% 153.7 Delayed Quote.-19.89%
TRIVAGO N.V. 2.32% 3.53 Delayed Quote.42.56%