Facebook and Google Ad Credits during COVID-19

Explain to me how you are thinking about your marketing team and furloughing people, keeping people, managing your team, in that sense.

We are extremely proud of the team that we’ve collected. I’ve seen a lot of e-commerce teams, online marketing teams, in the past, in the 15 or 16 years that I’ve worked in this business and this team is top-notch. That means there has been a lot of time and effort going into recruiting these people and making them part of our process and making them part of our brand. It would be a huge, huge waste if you let these people go and then, when travel resumes, you have to recruit them again. It will take years. This is why we’ve been looking at ways to continue with the existing team, even though we’re still saving costs.

There are a couple of ways that we’ve done this. One of them is the part-time labor. I’m not sure if that is the correct term in English. This means that, if you are in an industry that has been hit badly by this virus, then you can actually let people work part-time and the other part where they are not working, they’re taken care of by the government. For a large part of our workforce, such as customer service, these people were very busy when the virus hit, but now that no one is travelling, they’re actually not very busy at all, but we will need them again, when we resume business. So these go into a certain percentage of part-time unemployment and they are still contracted by us.

So I’ve done the same with my team. I’ve looked at how we can take a haircut of 30%, across the board, and see how we can solve that with the part-time labor on one end. Or, if we still need people, like product and engineering, we need them full-time. People who are working with me on the strategy that we are now rolling out, I need them full-time. These people took a voluntary pay cut – and the part-time labor is also voluntary – in exchange for stock. It’s a pay for stock solution that we’ve handed to people. It’s very beneficial, if you look at the valuation of the stock that we’ve handed out. Those are the two things that we’ve done for the cost that we have in personnel.

Then, of course, there are two other costs. One is the cost of our building, for instance, where we’ve taken a look at, how can we make sure that we don’t have to pay rent every month, but maybe it comes from the down payment that we’ve done. One the other hand, you have the costs that you have with your media partners. In performance marketing, we have the Googles, the Facebooks, the Microsofts of the world. We’ve been having ongoing chats with them, to see how we can partner together, in order to share this load. How can we defer payments? How can we work with you, to share more data? We’ve seen, in the past months, that we’ve had such a rise in cancellations, but we have paid for all these clicks or we have invoices for all these clicks. Can we work together to, maybe, migrate some of those increases into future ad credits. We will still spend them with you, however, we want you to share the cost burden of all of those cancellations that we’ve given back to the travelers.

Those are ways that we, in the short-term, improve our cash position.

How have Google and Facebook responded to that idea?

When I was at Google and even before that, I tried to do a longer payment term and it was no, right away. But this situation is different. They actually see that they will have to work with us, in order to have advertisers left, when we get out of this. They’re open to it, and I know that they are looking at it case by case. Some companies that don’t have a strong financial position like us, they were turned down immediately. But for us, these are ongoing conversations. At least, the deferred payments, they are accepted. The ad credits, I know they are already doing it for SMEs, for small and medium-sized businesses, they have given a lot of ad credits out. The question now is, to what level. Is it everything?