Tripadvisor shifting from arbitrage economics to engagement economics

This isn't the old Tripadvisor, which relied on metasearch and ad clicks. The new Tripadvisor uses generative AI for travel planning, allowing users to easily book experiences, restaurant reservations, and hotels

Tripadvisor once generated about 90% of its revenue from hotel and online travel agency ads through its metasearch feature, according to Goldberg. By attracting customers through Google and other ads, Tripadvisor earned more from user clicks on hotel links that redirected them to third-party booking sites.

Key takeaways

• Users would visit the site, click through, and Tripadvisor would earn a fee. While the company isn't abandoning that model, metasearch is no longer driving growth. In the second quarter, the Brand Tripadvisor segment, which includes metasearch, accounted for less than 50% of total revenue and declined 10% year-over-year;
• Users can now book tours and activities through Tripadvisor and its sister brand Viator, as well as hotels through a new partnership with Hopper in the Tripadvisor app. The goal is to engage travelers "mid-funnel" in the app, using generative AI tools like the Trips feature to help them build itineraries.

Get the full story at Skift (by subscription only)