The world of travel has changed dramatically since Glenn Fogel first joined the company that would become Booking.com 25 years ago. Today, it’s almost unimaginable to go through a travel agent, and almost all travel plans are booked online. Fogel has helped navigate the company through these transitions, and is now driving Booking Holdings, the parent company of Booking.com, KAYAK, and OpenTable, to its inevitable future with AI. Through this transition, he says, travel websites aren’t going anywhere; indeed, he’s planning for them to be more essential than ever. It’s working with investors; Booking Holdings stock is near an all-time high.
[time-brightcove not-tgx=”true”]TIME caught up with Fogel on March 5 to talk about his expectations for the future of travel.
I think you’ve been at Booking for 25 years, is that right?
25 years exactly last week
Congratulations
You know, we get nothing, no toaster . . .
No watch?
Well, I got a thank you.
What made you join the company in the first place?
Well, it was 1999 and the dot com boom was happening, and I was a trader at Morgan Stanley asset management. I had been a software developer and I had been an investment banker. And as a banker, I covered the airline industry, so I had some familiarity with that. It just seemed so much more exciting to be part of this new technological revolution.
The company did a lot more things back then.
We were into so many different verticals. We were doing name-your-own-price for everything. Name-your-own-price for cars, for mobile phone time, for home and life insurance. And we were hemorrhaging cash.
So we needed to take some massive, drastic steps.
How did you turn things around?
We noticed that people wanted to book their own hotel knowing what hotel they’re going to get, instead of the name-your-own-price model. But we didn’t have a model like that, so I started looking around at who knew how to do that. I found a bunch of people who had graduated from Cambridge [University], and they had started a company called Active Hotels. We got them to join our company. And then very shortly thereafter, we found a very similar company in Amsterdam called Booking.com. We were able to convince them to come and join too. We combined them together—Booking.com was a much better name—and that was the start, around 2005.
Why did that resonate?
It was a great model because it did something that people liked, which was that you knew what you were buying in a hotel. You knew what the price was. And really important, you didn’t have to pay until you showed up at the hotel.
It was an agency model, meaning we got our commission after the person was staying at the hotel. So the traveler didn’t have money go out of their credit card two months before they traveled. And the hoteliers were happy about it because they hadn’t been getting their money until long after the person stayed. So they got their money sooner. It was a win-win for everybody. And we just started growing.
Fast forward to today, what’s something that you’re not offering, that you think customers want?
Well, what we are doing now that is so exciting is what we call the connected trip, which is when the systems are all connected. It brings together all the different verticals, flight, hotel, ground transportation, attractions—all the elements of a trip in one way, one place, our place, that knows so much about you.
How does that differ from how Booking.com works now?
Have you ever used a human being travel agent?
Yes.
Maybe that person knew you a little bit because you used her before, and she’d work with you and make things a lot easier. In addition, that agent probably knew what you like and what you could afford.
Unlike when you go online, if you don’t have a relationship, you can get a long list of options and have to try to sift through it all.
The idea of the Connect trip is to make it much less complicated. When you’re done, you’re just dealing with one point of contact, not multiple different ones. That has been the vision for some time.
Now, with all the advancements in generative AI, we’re going to be able to do it in a much simpler way. We’ll be able to personalize everything to you, and that’s really where the goal is and where we’re driving towards.
It’s almost like Booking.com would have a memory of you and understand what you want?
Let’s say you’re at the airport and you get a text from the airline that says your flight is delayed four hours. Pretty annoying.
But I’ll bet they never sent you a text that said your flight is delayed four hours, however, we have a competing airline that’s departing in two hours. We’d be happy to switch your ticket right now.
We should be offering that up to you, making it easy for you. Before you even know there’s a problem, be offering a solution to that problem.
How does generative AI help with this?
Eventually you will make a call to customer service, and what’s picking up at the other end is not a human being. It sounds like a human being. You wouldn’t know it’s not a human being, except that regulatory [authorities] will probably be required to say it’s not human.
The great thing is, generative AI will never come to the office tired. It will never be upset, because they had a fight that morning with their partner when they left the home. And they won’t get upset that you’re upset. That will make it so much better going forward. That’s going to be more for the simpler problems.
For complex problems, we’re still going to have to deal with humans. But they’ll be able to do their job better. Because when they’re looking at their screens while they’re talking to you, the generative AI will help give all sorts of solutions and ways to solve the problem.
That’s why you’ll be happier, and that’s why you’ll be more loyal, because we’re providing you with better customer service.
We’re talking a little bit about what generative AI can do if there’s a problem, what about if there’s not a problem? How can it help you have a better travel experience from the outset?
I can give you so many examples of this. Let’s go with the basics of what do you like in terms of a hotel?
Quiet, walkability, middle-of-the road price.
So, right now, to do that, you generally on most sites will have to put in some filters. There’ll be a filter for a three star middle road, and there’ll be a map, maybe where it is. But imagine this. You just type into a search box, I need a hotel in, let’s say, New York. I’d like the middle of the road price, and I’d like it to be a walkable area in the center of the city where it’ll be close to museums, etc. And you don’t have to click a filter, that’s what you can do on Booking.com now.
What gets even more interesting, though, is the hotels that you’re going to see in the search results, the content that you’ll see today will be what is known as static, meaning it’s in the database. It’s the same no matter who is looking at it. But imagine instead using generative AI, it is going to show different content based on what your requests were. You thought what was important was walkability. It will talk about the walkability of the hotel first thing in the first paragraph. We’ll be able to dynamically create content that actually is personalized for what the person who is doing the search is looking for.
Let’s talk a little bit about the economy. You know, I think there’s a lot of uncertainty out there right now. What do you see as the trends for travel in the next 12 months?
There’s a healthy demand for travel. That’s basically what we say in terms of what we think about the future.
What I try and direct people to always think about in terms of travel, is that travel is one of those things that almost seems like a basic need for human beings. If you look over a long period of time, 100 years, travel has always been growing, in the long run, faster than GDP.
And as people get wealthier, going from poverty to middle class, one of the first things they want to do is travel.
And even as people get wealthier, wealthier, up the income level, they just travel more and maybe go to more expensive hotels.
That is a consistency that is going on decade in, decade out. So somebody says, what do we think is going to happen this year? Because of the economy, I say, I have no idea, because who knows. But I do know that over a decade, travel will grow faster than GDP, and the way people travel will become more and more through a digital process like us, as opposed to the old non-digital going into a shop or making a phone call. Those are consistencies that I know, but I don’t try and predict this year’s economy.
People can go to ChatGPT and ask where to stay, bypassing your site. How do you keep them from bypassing you?
Go back 25 years ago when I first joined: there were a heck of a lot of ways to find out about hotels, and there still are. How many people go to Google first, right? There are always tons of ways to find things out. ChatGPT is wonderful, but Google’s been around for an awfully long time. There are a lot of people who type into Google, ‘Hotel in New York,’ but we continue to grow nicely.
Tell me about your favorite place to travel.
Home. I travel so much. I am always traveling around the world, so many different places, so many different offices, so many different things. We’re a very global company. We are able to put you into over 220 countries and territories around the world. We do our business in over 40 languages. I am traveling all the time. One of the happiest places I travel to is home after a trip.
Like you said, you have employees all over the world, how do you bring them together as employees of one company?
If you want to use a sports analogy, you have lots of different players in different positions. How do you all focus? Well, having one goal. If it’s a sports team, it’s to win. If it’s a business like ours, we have a mission that I believe is very important. Our mission is to make it easier for everybody to experience the world.
Now, this is a noble mission. It’s not curing cancer. But I ask you this, when you think back, what are some of your fondest memories? I go to somebody who’s maybe in their 50s or 60s. For them, that may be the birth of children, sure, maybe a wedding, sure, but I’ll tell you you want to make them cry. Talk about the time they took their kid to Disney World. Talk to them about the family trips they took with their children. The family trips they took as a child with their parents. That is an easy way to show you the power of travel.
I really believe travel helps people, brings together people of different cultures, of different places. It helps build understanding of others. It’s a really powerful thing. That’s why I say, okay, we’re not trying to cure cancer, but we sure are doing something that’s making the world better.
How will you know if you’ve won?
This is not a competition to win. This is an ongoing mission that will never end, because there’s always been more places to explore. There’ll always be new places to learn about, new people to meet. It never ends.
source https://time.com/7284698/booking-ceo-glenn-fogel-interview/
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