Booking Holdings

The battle between Airbnb and Booking (and everyone else in online travel) is just beginning.

Travel is full of discovery — sometimes not for the better. The CMO of Booking.com explains how the company is trying to ease some of those unhappy surprises.

The acquisitions of Active Hotels and Bookings B.V., which led to the creation of Booking.com, transformed parent company Priceline.com, and online travel history. Take a look at Priceline's fourth quarter of 2005 financial results, and you'll be able to see the journey in process.

The stars were seemingly aligned when Booking.com made its move. The big U.S. players were too comfortable with their huge margins from the merchant model; Booking.com focused on independent hotels; and search engine marketing was on the rise. Still, it was the entrepreneurs and dealmakers who made it all happen.

The deal surprised analysts, some of whom didn't see an obvious logic for it. Yet one thing is sure: Online hotel sales are a bit like an old-fashioned butter market. A big chunk of butter changes hands multiple times and everyone gets their hands greasy.

Booking.com is Booking Holdings' favored child, but with the addition of HotelsCombined, it is apparent that the parent company still sees plenty of opportunity for its Kayak unit in metasearch worldwide. This deal will help Kayak expand in Asia Pacific, and will give HotelsCombined additional resources as well.

This is the oral history of Priceline's two deals, the acquisitions of Active Hotels and Bookings B.V., that created Booking.com, and continue to shape the course of online travel and the competitive landscape today. The twin transactions were among the greatest Internet deals of all time, and their lessons are relevant to startups and dealmakers in any industry.

Online travel agencies remain essential to the travel industry as consolidators of, and clearinghouses for, advertising dollars throughout the space. We do not see OTAs being removed from this position easily, but growing challenges have hurt ad efficiency. OTAs must remain nimble to keep pace.

TV ads can be the hippest type of marketing. But the personal brand of Booking.com's chief marketing officer Pepijn Rijvers is tied up in a data-first approach that instead emphasizes paid ads in search engines.

Online travel agencies remain essential to the travel industry as consolidators of, and clearinghouses for, advertising dollars throughout the space. We do not see OTAs being removed from this position easily, but challenges are growing by the day.