Skift Take
Priceline Group CEO Darren Huston touts his company's organic growth versus Expedia Inc.'s strategy of mostly acquiring companies that need to be put back on track. Rest assured, however, that Priceline would plunk down a few billion dollars on the right acquisition target. It just wasn't HomeAway, and TripAdvisor and Airbnb are too expensive.
Priceline Group CEO Darren Huston says his company didn't get involved when HomeAway put itself up for sale because "we're quite picky" and HomeAway's model of allowing vacation rental owners to wait 24 hours before confirming a booking and charging travelers a booking fee "just didn't fit us."
These were among the more newsy points that Huston made when Skift conducted a one-one-one interview [in full, below] with him at the Phocuswright conference in Hollywood, Florida, on November 18.
Expedia Inc. announced November 4 that it would acquire HomeAway for $3.9 billion in cash and stock. Asked whether the Priceline Group got involved in that sales process, Huston said: "No. Although we've talked to them for years. We were very much aware of it. We knew kind of how it was going. We did a little bit of thinking and said this isn't the right thing for us. We're quite picky."
Huston is betting that's his Booking.com's alternative model in vacation rentals -- instantly confirmable online bookings with no traveler booking fee -- will win out over the Expedia-HomeAway goal of online bookings and a traveler service fee along with letting vacation rental owners vet reservations before accepting them.
"We've now been on a path and are sticking to the principle of properties being instantly bookable and verifiable, and no consumer fees," Huston said. "Now we're so far along the path that buying something that doesn't fit that model just didn't fit us."
The Priceline Group's Booking.com unit has been adding apartment hotels and vacation rentals for years, and Huston had some pointed things to say about the Priceline Group's strategy in vacation rentals and merger and acquisition activities versus Expedia Inc.'s.
"I didn't end up spending $4 billion, and we did it with just a couple of handful of people," Huston said, referring to building Booking.com's vacation rental business. "That is an indication of what makes our company special. It's been organic execution, it has created more value for the company than M&A, and that continues to be our bet."
Huston argues that the Priceline Group strategy is to build or acquire leading brands -- specialty stores, he calls them -- as opposed to Expedia Inc.'s acquisition-consolidation strategy related to brands that have struggled, including Travelocity and Orbitz Worldwide.
"I like playing up that hand better than going in and buying companies that aren't doing very well, and stripping out all the w
