Citi Global TMT Conf. 2025: Fireside Chat w/ BKNG CFO on Growth Drivers, GenAI, & Travel Mkt Trends

Key Takeaways

TL;DR: BKNG remains well positioned for sustained top-line & margin expansion, driven by:

• (1) successful direct & diversified mktg strategies
• (2) accelerating Connected Trip adoption & cross-vertical merchandising
• (3) effective, ROI-driven GenAI implementation yielding real cost & cancellation benefits
• (4) robust alt. accommodations & APAC growth
• (5) disciplined cap. allocation w/ continued buybacks & rising divs.Mgmt highlights growing scale advantages, high incremental profitability, & new verticals (fintech, adv., flights, attractions) amid ongoing op. leverage & rising EBITDA margin guide.

Key Topics & Takeaways

1. Competitive Differentiation & Value Prop to Hotel Partners

• Five Core Value Drivers: Demand gen, global mktg scale, 24/7 multi-lang. customer svc, tech/analytics, payments.
  • Direct quote: "If we can bring [a hotel] from 50% to 80% occupancy, that is pure profit to them..."
  • BKNG delivers incremental, variable-expense-driven demand; partners only pay for realized bookings.
  • Mktg: Spends $7–8B/yr globally, providing scale/reach beyond hotel capabilities.
  • Tech/Analytics: Delivers actionable insights, benchmarking, pricing, & positioning tools.
  • Payments: Offers global/local payment formats, assumes fraud risk, enables merchandising strategies independents can't replicate.

2. Channel Shift: Direct, Diversified, & Social Mktg

• Direct Traffic Share: Now "mid 60%" of B2C traffic is direct, up significantly YoY. Paid reach ("mid 30%") increasingly diversified beyond Google.
• Social ROI: "Cracked the code" w/ Meta; expanding to other social platforms w/ proprietary measurement/targeting; all spend now measured for incrementality.
  • Quote: "We can measure incrementality, meaning we know that that traveler wouldn’t have booked anyhow with us."
  • Content Evolution: Video/reels outperform static; proprietary "clean data room" w/ social partners enhances targeting/attribution.

3. Connected Trip & Multi-Vertical Momentum

• Connected Trip: Now "low double-digit" % of total txns (growing +30–40% Q/Q), driven by cross-vertical integration (hotel + flight + attractions).
• Platform Effects: Higher share-of-wallet, greater customer freq/loyalty, increased repeat rates as customers use multiple verticals.
• GenAI Vision: BKNG aims to evolve Connected Trip into a proactive, hyper-personalized, itinerary-based, trip-mgmt experience, w/ real-time actionable suggestions leveraging user context. Features in dev ("not live today"), enabled by GenAI.