Skift Take
eDreams Odigeo's stock price has tanked since it started trading in April. Still, if you look at some of the company's technology advantages, the flight-search group has a lot of things going for it if the company can stick it out over the long term.
Editor’s Note: Skift is publishing a series of interviews with online travel CEOs talking about the Future of Travel Booking, and the evolving habits and device preferences of travel consumers. Check out all the interviews as they come out here.
Founded in 2000 as a Silicon Valley vacation-packages startup with two employees, Barcelona-based eDreams Odigeo has emerged as a flight-search specialist that has rolled up five brands in Europe, employs 1,600 people, and executed an IPO in April, although its stock has tumbled and now trades for less than 3 euros ($3.81).
Founder and CEO Javier Pérez-Tenessa speaks of the complexities of flight bookings, the one trillion price changes the company monitors daily and the seven billion pricing decisions it makes on an hourly basis as "quite a paradise for a company of engineers, mathematicians and people like us at eDreams."
eDreams Odigeo, according to Pérez-Tenessa, operates in a way that is contrary to a lot of perceptions about selling flights online. eDreams Odigeo, he says, sets many of its own prices because it creates millions of flight combinations that others ignore; it is a high-margin business, and the company reduced the average price that its customers paid by 10% in 2013 despite often charging booking fees.
Skift spoke to Pérez-Tenessa about the future of travel booking, eDreams Odigeo's competitive advantages, its labors in creating a common technology platform for its five brands, mobile trends, and the significant challenges the company has faced since its April IPO.
An edited version of the interview follows:
Skift: Travel companies have been offering flights online for nearly 20 years. How difficult can it be for eDreams Odigeo to offer them something new and different, and where do you think the future of flight booking is heading?
Javier Pérez-Tenessa eDreams Odigeo has been offering flights online for 15 of those 20 years and every year we improve and add to our product offer. This has allowed us to go from a two-person startup in Silicon Valley to today becoming the world's largest retailer of flights by revenue, based on last year's data, with more than 15 million customers per year.
Flights is the largest ecommerce category in the world and finding the best price is a very complex problem, which we still continue to see. The number of combinations of routes, airports, stopovers and fare classes is very, very large and continues to grow. And we are also
