Hopper, Trivago and Etraveli on innovating from the middle

Travel intermediaries such as Hopper, Trivago and Etraveli Group sit squarely in the middle of multiple stakeholders: travelers, partners, investors and employees. 

Managing those dynamics while continuing drive product innovation and growth can be challenging.

In a panel discussion at Phocuswright Europe 2022, Hopper chief strategy officer Dakota Smith says intermediaries can provide unique value on the product development side because they may have the advantage of newer technology systems than some of the suppliers that are constrained by legacy platforms.

But that type of innovation still requires collaboration and coordination.

As Trivago CEO Axel Hefer explains: “You cannot just come up with a good idea and develop it yourself and then all of a sudden the value is created. You need to come up with a new feature or a twist to your original idea and then work to with many, many partners to really create the value for the customer.”

Along with Etraveli Group senior vice president for corporate development Lisa Katsouraki, the panel also discusses the importance of maintaining focus as a company grows – and the enduring question of “buy or build.”

“For the non-fundamental things to your core value proposition, you have to buy and not build,” Smith says.

“And that’s something you have to combat when you are trying to scale up a technology company, it’s easy to fall into that trap of trying build every single feature and functionality.”

Regarding acquisitions, Katsouraki – whose company was acquired by Booking Holdings in 2021 - says, “You have to make sure that the overlap is always as minimal as possible to make sure you are not destroying any value.”

The panelists also discuss the economy and impact of a recession on the travel industry.

“For [Trivago] it means the cost-consciousness of the consumer is likely to go up. ... That’s where we are focusing our innovation power on,” Hefer says.

Smith says for Hopper, the economic slowdown is driving a shift in mindset at the company, which in 2021 had two funding rounds of $170 million and $175 million.

“We have to ... continue to innovate on behalf of our customers and capture market share, but we have do it in a way that leads eventually to profitability, that doesn’t have an implicit assumption that we will be able to raise more money again freely, or as freely as 2021 and 2020."

Watch the full discussion with Phocuswright research manager Coney Dongre below.