How Google Is Winning Travel

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Hello from Skift. It’s Thursday, April 25 in New York. Here’s what you need to know about the travel industry today.

Rashaad Jordan

Today’s edition of Skift’s daily podcast discusses Google’s huge travel recovery, Wyndham’s growing ambitions and Finnair’s solution to its Russian problem.

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Episode Notes

Google has benefited hugely from the rebound in travel, with its parent company Alphabet revealing on its first-quarter earnings call on Tuesday that the sector contributed significantly to the growth in Google’s advertising business. And with the tech giant’s travel search activity higher than during the same period in 2019, the company appears to be the winner of the meta-search wars, research analyst Seth Borko writes for the latest Skift Research report.

The report, A Deep Dive Into Google’s Impact on Travel 2022, also includes five critical questions about the company’s role in the industry’s recovery, as Borko writes that every travel leader needs to ask themselves “What is our Google strategy? ?” Additionally, the report delves into topics such as how much travel agencies spend on Google and how the tech giant influences hotel and flight bookings.

Then, hotel executives have expressed concerns in recent months about issues such as inflation, labor shortages and supply chain disruptions affecting their bottom line. But Wyndham Hotels & Resorts – the world’s largest hotel franchisor – is optimistic about the future, betting the rise in hotel investors represents significant growth for the industry, reports Sean O’Neill, hotel editor.

Wyndham Chairman and Chief Executive Geoffrey Ballotti said on his first-quarter earnings call on Wednesday that his franchisees believe they are entering a supercycle that could last a decade. The term supercycle refers to a period of above-average growth without the trajectory of a standard economic boom and bust cycle. One of the reasons O’Neill cites for the growing interest in franchise hotels is long-term customer demand for roadside properties. Companies that enter into contracts to build roads, bridges and waterways following Congress’s recent passage of an infrastructure bill will have to find housing for workers, which O said. ‘Neill, offers an opportunity for hoteliers.

Meanwhile, Wyndham reported a profitable first quarter as it generated $106 million in net profit, five times the figure for the same period in 2019.

Finally, airlines redirected their flights after Russia closed its airspace to planes from dozens of countries in early March in response to nations doing the same with Russian planes. But perhaps no carrier bears the brunt of Russia’s decision so much as Finnair, which was forced to make major changes to its operations.writes airlines journalist Edward Russell.

Finnair CEO Topi Manner acknowledged during the company’s first-quarter earnings call on Wednesday that it was uncertain how long Russian airspace will remain closed. This closure forced Finnair to suspend flights to North Asia at the start of the war in Ukraine and is the reason why Finnair flights to 10 Asian destinations are still suspended. The carrier’s overall capacity in Asia will also be down 65% in the third quarter, according to airline industry data firm Cirium.

While Finnair realizes it needs to scale back in the long term, writes Russell, the airline has already sold four A321s, a decision it made because of its lower-than-expected flight levels.