TripAdvisor 2015 Annual Report Download - page 16

Weexpecttheinstantbookingfunctionalitytosignificantlyincreasethenumberoftransactionsthatwilloccuronourwebsite.Eventhoughthetransaction
andcustomercareassociatedwiththesetransactionsareprovidedbyourhotelpartners,eachreservationiscompletedonTripAdvisor’sinstantbooking
platform.Failuretoeffectivelymanagetheprocessforinstantlybookingonourwebsiteandthesafeguarddatathatisobtainedduringthecourseofarrangingfor
suchbookingscouldnegativelyimpactourreputationand,consequently,ourbusiness.
Growth in the use of devices other than desktop computers may negatively affect our revenue and financial results.
OurcontentwasoriginallydesignedforusersaccessingtheInternetonadesktopcomputer.ThenumberofpeoplewhoaccesstheInternetthroughdevices
otherthandesktopscomputers,includingmobilephonedevicesandhandheldcomputerssuchasnotebooksandtablets,hasincreasedsubstantiallyinthelastfew
years.Weanticipatethattherateofuseofthesecomputingdeviceswillcontinuetogrow.Toaddressthesegrowinguserdemands,wecontinuetoextendour
platformtodevelopmobilephoneandtabletapplicationsandouradvertisingrevenuescontinuetogrow.However,currently,wemonetizeusersofthesedevicesat
alowerratecomparedtouserswhoaccessourwebsitesthroughdesktopcomputers.Inaddition,giventhedevicesizesandtechnicallimitationsofthesedevices,
mobileconsumersmaynotbewillingtodownloadmultipleappsfrommultiplecompaniesprovidingsimilarserviceandinsteadprefertouseoneoralimited
numberofappsfortheirhotel,restaurantandattractionsactivity.Theconsumerexperiencewithmobileappsaswellasbrandrecognitionandloyaltyarelikelyto
becomeincreasinglyimportant.
Asaresult,wecontinuetodevelopandimproveuponourmobileappandwebsitesandmobilemonetizationstrategies.Ifweareunabletocontinueto
rapidlyinnovateandcreatenew,user-friendlyanddifferentiatedmobileofferingsandefficientlyandeffectivelyadvertiseanddistributeontheseplatforms,orif
ourmobileofferingsarenotusedbyconsumers,ourfuturegrowthandresultsofoperationscouldbenegativelyimpacted.
Declines or disruptions in the economy in general and travel industry in particular could adversely affect our businesses and financial performance.
Ourbusinessesandfinancialperformanceareaffectedbythehealthoftheglobaleconomygenerallyaswellasthetravelindustryandleisuretravelin
particular.Salesoftravelservicestendtodeclineorgrowmoreslowlyduringeconomicdownturnsandrecessionswhenconsumersengageinlessdiscretionary
spending,areconcernedaboutunemploymentorinflation,havereducedaccesstocreditorexperienceotherconcernsthatreducetheirabilityorwillingnessto
travel.Theglobaleconomymaybeadverselyimpactedbyunforeseeneventsbeyondourcontrolincludingactsofterrorism,unusualweatherpatterns,natural
disasters,politicalinstabilityandhealthconcerns(includingepidemicsorpandemicssuchasZikavirus,Ebola,H1N1andSARS),defaultsongovernmentdebt,
significantincreasesinfuelandenergycosts,taxincreasesandothermattersthatcouldreducediscretionaryspending,tighteningofcreditmarketsandfurther
declinesinconsumerconfidence.Decreasedtravelexpenditurescouldreducethedemandforourservices,therebycausingareductioninrevenue.
Inaddition,theuncertaintyofmacro-economicfactorsandtheirimpactonconsumerbehavior,whichmaydifferacrossregions,makesitmoredifficultto
forecastindustryandconsumertrendsandthetiminganddegreeoftheirimpactonourmarketsandbusiness,whichinturncouldadverselyaffectourabilityto
effectivelymanageourbusinessandadverselyaffectourresultsofoperations.
We rely on the value of our brand and consumer trust in our brand. If we are not able to maintain and enhance our brand, or if events occur that damage our
reputation and brand, our business may be harmed.
WebelievethattheTripAdvisorbrandhascontributedsignificantlytooursuccessandthatmaintainingandenhancingourbrandiscriticaltoexpandingour
baseofusers,tocreatingcontentandtoattractingadvertisers.Asaresult,weinvestsignificantlyinbrandmarketing.Weexpecttheseinvestmentstocontinue,or
evenincrease,asaresultofavarietyoffactors,includingincreasedspendingfromcompetitors,theincreasingcostsofsupportingmultiplebrands,expansioninto
geographiesandproductswhereourbrandsarelesswellknown,inflationinmediapricing,andthecontinuedemergenceandrelativetrafficsharegrowthofsearch
enginesasdestinationsitesfortravelers.Sucheffortsmaynotmaintainorenhanceconsumerawarenessofourbrandsand,evenifwearesuccessfulinour
brandingefforts,sucheffortsmaynotbecost-effectiveorasefficientastheyhavebeenhistorically.Ifweareunabletomaintainorenhanceconsumerawareness
ofourbrandsortogeneratedemandinacost-effectivemanner,itwouldhaveamaterialadverseeffectonourbusinessandfinancialperformance.
Wereceivesignificantmediacoverageinourvariousgeographicmarkets.Unfavorablepublicityregarding,forexample,ourpracticesrelatingtoprivacy
anddataprotection,productchanges,competitivepressures,theaccuracyofuser-generatedcontent,productquality,litigationorregulatoryactivity,could
adverselyaffectourreputationwithourusersandouradvertisers.Suchnegativepublicityalsocouldhaveanadverseeffectonthesize,engagement,andloyaltyof
ouruserbaseandresultindecreasedrevenue,whichcouldadverselyaffectourbusinessandfinancialresults.
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