Google bought AdMob, Norm was right, the BOOT was wrong - time to eat humble pie

In my predictions for 2009 (back in January) I said the following

"2009 will not be the year of mobile for the travel industry: Every year since 2000 we have been talking about the mobile revolution in online travel. This year I rejoined that chorus of mobile revolution fan boys while at PhoCusWright in LA. With the Global Financial Crisis (I am told there is even an acronym for this - GFC) in full swing I think the larger players will pull back from their mobile plans and focus on core products, costs control and customer loyalty. Mobile will have to wait until 2010; and"

Many disagreed including Norm Rose, arguing that the proliferation of smart phones and mobile apps would prove me wrong. But I would not be talked out of it. In September I reaffirmed by prediction saying

" The argument in favour of my prediction is that bookings of travel via mobile phones apps (outside of Korea and Japan) are still very small and arguably inconsequential to the $150+ billion online travel industry. "

Here we are in November and I was looking forward to debating my position with Norm at PhoCusWright next week. But with barely a week to go before seeing Norm in Orlando, Google won the debate for him by buying AdMob for $750 million. AdMob is/was a Sequoia backed mobile display advertising platform.

This means that Google's third largest acquisition ever (after YouTube and DoubleClick) is of a company with maybe $40mm in revenue focused on putting adverts on iPhones, Android phones, smartphones etc. We now have a revenue model and distribution for advertising on the phone. Add that to the travel app bonanza on iTunes and elsewhere, the levels of smartphone penetration, augmented reality and more.

You got me Norm. I concede. Google has closed out the year with a big M&A deal proving that 2009 is indeed a year for Mobile. See you in Orlando for a piece of humble pie.

More on the deal read these two TechCrunch posts

• Google Acquires AdMob For $750 Million; and
• AdMob Is “Approaching $100 Million” In Revenues. Google Thinks It Can Be Billions

thanks to smiteme for the pie photo

Interview with Joobili boss Jared Salter - Part 1 - rasing money in Europe

While the fees, sales and my promo is bigger than your promo claims that are the battle of the OTAs in the US has ramifications for the state of the industry going into the second decade of the 21^st century, I continue to be most excited by the innovation coming out of travel discovery and inspiration sites. Sites set up to help customers answer the open-ended question “where do I go next”. A question that is only now being asked of the online travel industry on Google, Twitter, Facebook and elsewhere. The sites that are at the forefront of data analysis and projections in line with my EveryYou concept of using the technology and social transformation in front of us to develop a specific and targeted recommendation of one based on the unique combination of desires, needs and interests of each individual at any moment in time.

I have already done a number of profiles in this area including one of the Budapest based Joobili (pronounced Jubilee). Now I have had a chance to spend time over skype with Jared Salter the founder and CEO of Joobili to hear about his experiences in founding a online travel company in Europe, on time based travel inspiration, on the balance between pre search information requesting and post search refinement and the rights and wrongs of attending a Swiss turnip festival.

In short Joobili is a time based travel search, discovery and inspiration engine. At the entry screen you select the date range you are interesting in travelling on and Joobili replies with a list of festivals, activities, events and time based entertainment that are on during that time period. Options for refinement are then presented to help narrow down the list to a short list of trips. Joobili starts with the question “when do you want to go?” rather the standard OTA question “where do you want to go?”.

As with other interviews, this is best suited to a two part blog post. In the first part we will talk about the set up of the company especially raising money in and running a business from Europe. Then in part two I will share our discussions on the functionality of Joobili and the travel and inspiration market/industry.

The interesting summary of part one of this interview is that Jared and his partner Tamas Gabor managed to raise seed money for an Eastern European based company without a prototype. They had a business plan and powerpoint that so impressed or struck the Swiss born Esther Dyson that she gave money without a working site and despite the possible challenges of monitoring a business off the beaten track (VC wise).

BOOT: Where did the idea come from? Do you have a history in tech or travel?

Jared from Joobili: I moved to Budapest from a corporate job in San Francisco to do an MBA. There I met my co-founder of Joobili Tamas Gabor. It was his idea to look at calendar based travels. Other sites start with the destination. We spent the first few months scouring the internet but could not find anyone doing calendar search. We built the initial business case during the MBA. The product took off when we secured funding.

BOOT: At what point did you decided to seek funding? Had you built a proto-type yet or did you manage to get funding off the back of a powerpoint deck and business plan?

Jared from Joobili: It is different for each entrepreneur but as neither of us had a tech background we had to raise money with just a business plan. Which was tough. But we needed money to build a beta site.

BOOT: Europe is not famous for lending money on a ppt only. Traditionally Euro VCs want to see something built, if fact more often than not they are looking for series B work. Did you have to go to America to get angel funding with nothing built.

Jared from Joobili: Yes Had been going after a lot of different Euro investors and VCs. We were lucky that Ester Dyson (investor in Orbitz, Flickr, Delicious, Dopplr and more) was coming to Budapest as part of some Euro boards that she was on. We got a meeting with her to show her our detailed plans and forecasts. It ended up being just a one hour but she committed. “This is something that belongs on the web” was her quote.

BOOT: Budapest is not the first place that springs to mind when I think of online travel and tech innovation. What has it been like trying to run a business from Budapest?

Jared from Joobili: From a standpoint of travel and start up it is a bad thing- as you miss out on the networking opportunities. So we do frequent trips to London. Last September we were involved in Seedcamp – one of only two travel companies. This month I will be at WTM so we get out as much as we can. That said there is a reason we started here and I would do it again. It is very cost efficient to develop technology here. There are some talented developers in Budapest. Given the amount of seed capital we raised, we would never able to build this business in San Francisco or London.

BOOT: Are you looking for more funding?

Jared from Joobili Fair to say that any start-up is always on the hunt for more money to develop new features. The list of features we want to build is longer than we can afford. And this is a tough market, especially for the discovery part of travel as it is the least tapped space of the travel process.

In part two we will talk about the Joobili business model and travel discovery and inspiration business.

Update - here is part 2

Interview with Wego CEO Martin Symes and Product Boss Ross Veitch on Content, Advertising, ADR, Meta-search and (naturally) Twitter

It has been a frustrating conference season for me this year. I had to leave TRAVELtech early this year to rush to the side of a sick relative. Then I missed WebInTravel altogether because of a back injury. As well a missing out of a lot of schmoozing and boozing, I missed a chance to catch up with Martin Symes and others from the Singapore based meta-search company Wego (aka Bezurk). Martin is an online travel veteran with stints at Zuji/Travelocity, BA and American Airlines. He is also an entertaining presenter and dinner companion. Through Wego he is at the forefront of meta-search in Asia so an interesting person to hear from. Last week I had a chance to catch up with Martin and Wego Product Boss Ross Veitch by phone to hear the latest on Wego, meta-search and the Asian travel market.

Here is some of our exchange. [nb- I was not smart enough or well trained enough to include in my notes which of Ross or Martin answered my questions so in the below I have blurred them into one respondent]

BOOT: How’s business?

Wego: Great – steady growth in all the metrics we look at. Traffic is up 200% year on year and revenue about the same. The recession has been good for us as it has brought to us looking for distribution and has added to the price sensitivity of consumers. Move from Bezurk to Wego brand and new platform has also helped, especially with SEO traffic. [SEO] Now makes up 50% of our traffic so acquisition costs are low.

BOOT: I noticed you have a new feature of ranking hotels by popularity in the sort order. Does a meta-search company have to choose between being a price based search engine or being a a mechanism for recommending hotels to consumers?

Wego: See them as complementary. We have adopted the same philosophy toward UGC aggregation as we have to price aggregation. Have not tried to do it ourselves. For content it is critical to get a mass of reviews so have crawled hundreds of different review sites and then broken down the content, created indexes and built a snapshot of what people are saying. The volume of hotel reviews for larger properties is overwhelming. We can help customers cut through the reviews and the price.

BOOT: The theory was that the recession/GFC would drive down CPM rates and drive up CPC rates as advertisers shifted their marketing budgets from display advertising to direct response. Is this true? What have you seen?

Wego: Hard to say as our display business is coming off such a low base. June on June we have had a 600% growth in display revenue – again a low base. Also for most of our customers we are selling integrated packages for display and direct response [clicks - BOOT]. An example is Hotel Spotlight [three hotels at top of search– BOOT] which is generating a dramatic increase in click through rates to not only the spotlight itself but organic listing further down the sort. Now trialling the hotel inserting their twitter feed messages into the Hotel Spotlight. Giving hotel a chance to put fresh content into the promo spot [now available in Singapore and coming elsewhere soon – BOOT]

BOOT: What about other plans for Asia? There is some tight competition with Qunar in China and Ixigo in India.

Wego: Some days India is our biggest source market for traffic. Though the click through rates are lower than other markets. Even so we think that it has more potential as a market than Chian. Very hard to monetise traffic from China. Our Chinese language sites are launched we have a few more languages planned

BOOT: ADR declines are hurting everyone. You are able to see prices from so many different angles. Where do you think ADR is going next year?

Wego: Agree, we saw big declines in ADR this year. Can’t see too much continued downside next year without another recessionary event. We hope to see rates stabilise and then we can get into targeting of deals. We are having discussions with suppliers about targeting to different user groups. This is the exciting next step for us and OTAs.

BOOT (to Martin): Final question about conferences and presentations. Twitter and instant blogging are now an unstoppable feature of presentations at conferences. How has it changed the way you present and prepare?

Wego/Martin: With presenting you now have to be aware that things will be taken out of context, re-twitted and sent around in seconds.

PS – Apologies again to Ross and Martin for (other than the last question) losing track of who was answering which question. Chances are that the answers I have above are a merger of comments from both of them

PS 2 – disclosure: Back in 2007 I did some consulting work for Wego

Kuxun acquisition takes TripAdvisor further into China

Expedia's TripAdvisor is to buy Chinese meta-search company Kuxun (at least I think it is a meta-search company) (according to Dow Jones via Hotelmarketing.com). TripAdvior CEO Steve Kaufer would not give away how much was paid but is quoted in the article as saying he has US$50mm to invest in China in 2010 and 2011 but this includes setting up the local version of TripAdvisor Daodao.com. Also said he plans to double the number of staff in China from 80 to 160. My guess (no basis just a hunch) is Kuxun will be used as the tech behind Daodao with Kuxun's brand to disappear soon after the deal.

In case you are wondering about meanings. I am reliably informed that Kuxun means Cool Information or Smart Information and Daodao means To Reach, To Arrive.

Her is my updated list of TripAdvisor Acquisitions in the last few years:

• Kuxun;
  
• Flipkey
  
• Airfarewatchdog.com
• OneTime.com
• Virtual Tourist
• HolidayWatchdog
  
• smartertravel.com
• bookingbuddy.com;
• TravelPod.com;
• Travel-Library.com;
• SeatGuru.com; and
• Cruisecritic.com.

I always close these stories with the reminder that Expedia owns TripAdvisor as you'd be surprised how much search traffic I get asking the question "who owns TripAdvisor"

PhoCusWright: Organising appointments and meet ups for Orlando Nov 17-19

I am going to Orlando for PhoCusWright November 17-19. Due to the nature of long haul travel I will be there for the whole day the 16th and 20th as well. My diary is starting to fill up with appointments. If you are interested in making a time to meet up please email me or make contact through PhoCusWright's eConnect conference network site.

Tnooz: BOOT on Lonely Planet on Tnooz

By second post for Tnooz is live titled "Tips for what Lonely Planet should do next". Contains some background on Lonely Planet's online plans over the last few years, the online and brand vision from new CEO Matt Goldberg and my recommendations on what else they could do. Check out the post here for more. He is an extract with my recommendations for Lonely Planet:

1. Content Expansion: Make more and more of the content currently only available in books available online with the aim of being the number one organic search results for every major destination search item. It might hurt some book sales but winning in organic search will be more valuable long term;
2. Open Syndication: Increase syndication capabilities by allowing bloggers, writers, transaction sites, Facebook pages and more to access content material is an open way. Similar to point #1 above, it might cost a few book sales but being the social network content source of choice will be more valuable long term.
3. Facilitate and Make EveryYou Recommendations: Invest in recommendation technology to allow the community forums and information to be combined with the editorial content, booking behaviour and other data available to put Lonely Planet at the forefront of the development of specific and targeted recommendations of one based on the unique combination of desires, needs and interests of each individual at any moment in time. See My EveryYou concept. It will cost money and development time but the future of inspiration and content sites are targeted recommendations.

Tnooz editor Kevin May has followed up with a post "We love Lonely Planet and want to see it get better says the BBC", where an interesting debate has started.

Bing Maps: Helping you find the middle of nowhere whether you want it or not

Bing was supposed to be the new black. Bing + Yahoo! search deal + Farecast integration + new mapping was supposed to = a revolution in search engines for Microsoft (excuse me.. not a search engine.. a discovery engine). For that all to work, the mapping has to work. Especially in travel. When people search for information on locations they need to be given very accurate mapping information on where the location is..well...located.

I have been house hunting recently and "accidentally" used an integrated Bing Maps feature on Internet Explorer. It failed miserably...in an entertaining way.

Here are the screen shots that tell the story. Shot 1 - the house in 138 Underwood St Padding (suburb of Sydney just next to downtown business region) that I was looking at and me highlighting the address and selecting map with Live Search/Bing. Shot 2 - the result. No only is the mapping result nowhere near Paddington, it is some 4,000 kilometres away on an Aboriginal reserve in the North West corner of Australia. In other words...somewhere near the middle of nowhere (with all due respect to the people who live there).

Shot 1 - me doing the search



Shot 2 - the result. We now know where the middle of nowhere actually is.
Described by Bing as "138, Aboriginal Land, Western Australia". Other than the number 138 there is nothing in common with the address I was searching for


Let me put shot 2 into perspective with Shot 3 showing how far away this is from the actual location of Underwood St Paddington

Shot 3 - how far apart the locations are


Think this is a one off? I tried the same for a property in another part of Underwood st Paddington (this time number 14 not number 138) Shot 4 is the result. At least this time in Sydney but still some 30-40kms away and under than the number 14 - nothing in common with what I searched.

Shot 4 - closer but still not close enough
Showing 14 Underwood st Paddington as 14 Bilgola St Newport


If Bing wants any chance at fighting Google, Kayak or the OTAs in travel search they will have to do dramatically better than this in the mapping area.