TripAdvisor: The Travel Company That’s Really All About Data

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the same ad appeared on some other page. In effect, TripAdvisor was providing travel companies with qualified leads. (This is, of course, exactly the same phenomenon that has generated such dizzying profits for Google and other providers of keyword-based advertising.)

In March 2002, TripAdvisor turned a $70,000 profit, and the company hasn’t looked back since. “From there, it was global expansion, covering the whole U.S. and other parts of the world,” says Kaufer. “A couple of years later it was local language expansion, into Spanish, German, Italian, et cetera. Eventually [in 2009] we branched beyond hotels, attractions, and restaurants into flights and vacation rentals. And along the way we built a media group that bought other travel sites, so we have TravelPod, CruiseCritic, SeatGuru, BookingBuddy, SmarterTravel, and three or four others.”

Actually, it’s nine others, and that’s not even counting the company’s 15 local-language sites. These days the company has 530 employees—about 300 of them based in Newton, with the 70-person London office as the company’s second largest. Its sites contain listings and reviews of 400,000 hotels and 500,000 restaurants across 70,000 cities worldwide, and in the travel sector its Web traffic is rivaled only by Expedia itself.

Mixed Reviews

While TripAdvisor’s massive database of reviews is its best-known asset, another interesting paradox is that the founders didn’t do much, at least in the beginning, to solicit or highlight them. “Originally it wasn’t really a big push,” Kaufer says. “Anecdotally, people told us that they loved the information they found on TripAdvisor, and that they’d like to post their own comments. So we added a ‘write a review’ button.” For a while, the company kept the links to outside reviews at the top of each listing, and buried its own readers’ reviews at the bottom, Kaufer says. “But when we looked at what users were actually doing on the site, they were skipping over the outside sites and going straight to our reviews. So we reversed the order.”

So while the “Write a review” option serves an important social purpose—giving visitors a chance to say whether they agree or disagree with the existing reviews, and to give back to the community by adding their own perspective—the decision to highlight them was, again, largely data-driven.

As TripAdvisor grew into a major repository of unmoderated reader reviews—meaning that angry and disappointed travelers are just as free to post their comments as happy ones—TripAdvisor ran into an interesting dilemma early on. Quite a few hotel and restaurant owners were put off by … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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