Booking.com SEM Competitive Advantage

What does Booking do so well, in SEM? What’s their secret, from your time at Google, what did you learn about that business?

I was responsible for the Booking account, at Google. I helped them as free advisor, that they get with their spend. Their revenues grew from, in the mid nine digits, to well over the 10 digits, in my two, two and a half years that I was there. I learned from their CMO, Arthur Kosten, something I think he took this from Thomas Edison, who said, “I have not failed; I have found 10,000 ways that won’t work.” What Arthur Kosten said was, “There is no failure; there are ways that work and ways that don’t.”

This is their approach to running a company. It helps the whole team to be able to spot ideas, voice their ideas, have the ecosystem to put those ideas to the test, without being slapped on the wrist, when the result is bad. Because a bad result means that we now know that doesn’t work and we try something else. That is the best way to summarize their experimentation and mindset.

Then in team, they choose smart people over experienced people. Lots of PhDs in physics and math were running performance marketing there. You cannot teach somebody to be smart and to know how to do experimentation really well, easily in a company. But you can teach people how AdWords works easily in a company. If you take those two, it’s easier to take the smart people and teach them all about marketing, than to take people who have all that marketing experience and then teach them how to think like a PhD.

It’s very much product led. They have the distributed responsibility to serve the customer. All of their goals are tied to customer success. Every piece that hits the customer, they get dedicated teams that continuously optimize it. From a distance, it might look like a website that is different types of font and different colors and all these things. But they created this experience where, the outcome of it is the highest possible conversion rate you can have.

People have made it clear they have an intent for travel and then they land on this website and they see the largest offering in the world. Whatever you want, you can find it here. Then you go into the search results and you see, indeed, that there is a huge offering, especially where you are looking for. Then you go a bit deeper and then they are poking you. Hurry up, so many left, so many people looking at this. Then there is more anxiety. Then you go one level deeper, with your credit card details and then they say, secure. Relax, you can give us your details. Then when you’ve booked, it’s almost as if it says, all right, now you can relax completely. It’s done; you’ve got the best deal, don’t worry. That whole emotional rollercoaster, how they designed that, is extremely smart.

Specifically towards SEM, and what they do so well in SEM, there are a couple of things. Relevance, shelf-space, the data over opinions, building for scale and partnership. First, relevance. Way back, when Expedia was still funneling their traffic through their home page, they already knew that whatever people type in that bar, in Google, we need to answer, here. Even though there are only a couple of people that type this in a year, if we have the technology that can map a page to it, at least we can help those people better. They have a system that’s also trying to build for scale and they have a system where they can use the size of the world to collect all of those single people, per country, that do that one search, collect them, aggregate them and then make a decision, is this a good ad for this type of query, yes or no? They just aggregate all of the data, globally, to make sense of, is this one query working, yes or no?

If you’re not a global company and you only have one market, you wouldn’t bother about these single terms that aren’t used that much. But they can, because of their skill. Their website is relevant and they can land people on all levels of the funnel, whether you are still looking, where do I want to go, I don’t know – actually, I think they could do better there. But as soon as you know where you want to go, whether it’s a country, region, city, area within that city, they can land you at the best possible level and offer you any place you want to stay there.