Monday, October 01, 2007

Another deal! Priceline and Travelzoo (updated)

I cannot type fast enough to keep up with the deals that are flying around. The latest to hit the BOOT radar is the piece on Hotelmarketing.com speculating that Priceline is going to announce an acquisition bid for content/travel advertising firm Travelzoo. Travelzoo is up 22% on the news. And I thought this was going to be a slow news week.

UPDATE - on the Q3 2007 PCLN earnings call a few subtle questions were asked of the Priceline management about any interest in owning Travelzoo. The questions were subtle and the answers therefore equivocal but it seemed that there is not (public) interest from Priceline in buying Travelzoo. A reader and I agree that this constitutes a "no" for now.

7 comments:

Anonymous said...

How much sense would it make for an online agency to buy a metasearch company?

Guillaume said...

Anonymous,

I don't consider Travelzoo as a metasearch engine...

Have you ever been to their website?

Guillaume
www.hotel-blogs.com

Anonymous said...

Sure have. I see plenty of deals, airfare discounts, hotel specials, etc. clicking on any of these deals brings you to an online agent or supplier.

I don't see any content on here...no reviews of hotel rooms, no tips on what time of year is best to stay in France, etc. So these guys don't sell advertising inventory on their site, and they don't process bookings. Seems like they get paid the exact same way a meta-search company does.....by leading a consumer to an agent or supplier.

Am i missing something ?

Anonymous said...

The fact is Travelzoo has a following. Very simply, this creates a nice ROI for many travel advertisers. The business model has held up and $80M in annual revenue is quite good when most costs are fixed.

Anonymous said...

I'm not questioning the sustainability of TravelZoo's business model, but rather asking if it would make sense for an online travel agent to own them.

Anonymous said...

What a perfect marriage. Travelzoo needs inventory & technology - Priceline/Booking.com/ActiveHotels got it. Now slim the organization and you have a nice profitable business

Tim Hughes said...

Travelzoo's big pitch is their independence so it is a fair question as to how that will be managed if owned by Priceline. In the early days of the TripAdvisor acquisition the independence from Expedia/Hotels.com was maintained but no so much anymore.