Expedia 2011 Annual Report Download - page 9

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hotels, car rentals, activities and private transportation — to create customized luxury vacations in Hawaii, the
Caribbean, Mexico, Costa Rica, Europe, Australia, New Zealand, Fiji and Tahiti. Travel agents and travelers can
preview our product offering through our websites, www.classicforagents.com and www.classicvacations.com.
Expedia Local Expert. Our Expedia Local Expert network offers face-to-face personalized
recommendations and assistance in booking events, activities, tours, attractions and other services that travelers
seek in their destinations. With access to a rich portfolio of thousands of tours and adventures, ELE operates
concierge and activity desks in more than 100 hotels and other retail locations in many key cities around the
world. ELE also operates www.localexpert.com.
Expedia CruiseShipCenters. Majority-owned by Expedia, CruiseShipCenters is one of North America’s
leading sellers of cruise vacations. CruiseShipCenters has over 150 retail locations, a team of 3,600
professionally-trained cruise consultants and a searchable online database of more than 10,000 cruise vacations.
Growth Strategy
Product Innovation. Each of our leading brands was a pioneer in online travel and has been responsible for
driving key innovations in the space over the past two decades. They each operate a dedicated technology team,
which drives innovations that make researching and shopping for travel increasingly easier and helps customers
find and book the best possible travel options. In the past several years, we made key investments in technology,
including significant development of our technical platforms that makes it possible for us to deliver innovations
at a faster pace. For example, we launched our new Hotels.com global platform in the first quarter of 2010,
enabling us to significantly increase the innovation cycle for that brand. Since then, we have been successful in
improving conversion and driving much faster growth rates for the Hotels.com brand. We are in the midst of a
similar transformation for our Expedia brand, having rolled out its new hotel platform in the second half of 2011,
with expectations that the new air and package platforms will be launched in 2012.
Global Expansion. Our Expedia, Hotels.com, Egencia, EAN, and Hotwire brands operate both domestically
and through international points of sale, including in Europe, Asia Pacific, Canada and Latin America. We own a
majority share of eLong, which is the second largest online travel company in China. We also own Venere, a
European brand, which focuses on marketing hotel rooms in Europe. Egencia, our corporate travel business,
operates in 46 countries around the world and continues to expand aggressively. We also partner in a 50/50 joint
venture with AirAsia – a low cost carrier serving the Asia-Pacific region—to jointly grow an online travel agency
business. Although the results for the joint venture are not consolidated in our financial statements, we consider
this business to be a key part of our Asia Pacific strategy. In 2011, approximately 39% of our worldwide gross
bookings and 42% of worldwide revenue were international up from 22% for both worldwide gross bookings and
revenue in 2005. We have a stated goal of driving more than half of our gross bookings and revenue through
international points of sale.
In expanding our global reach, we leverage significant investments in technology, operations, brand
building, supplier relationships and other initiatives that we have made since the launch of Expedia.com in 1996.
We intend to continue leveraging these investments when launching additional points of sale in new countries,
introducing new website features, adding supplier products and services including new business model offerings,
as well as proprietary and user-generated content for travelers.
Our scale of operations enhances the value of technology innovations we introduce on behalf of our
travelers and suppliers. We believe that our size and scale affords the company the ability to negotiate
competitive rates with our supply partners, provide breadth of choice and travel deals to our traveling customers
through an increasingly larger supply portfolio and creates opportunities for new value added offers for our
customers such as our loyalty programs. The size of Expedia’s worldwide traveler base makes our sites an
increasingly appealing channel for travel suppliers to reach customers. In addition, the sheer size of our user base
and search query volume allows us to test new technology very quickly in order to determine which innovations
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