DTK MEN Exclusive: Exploring the Mind of an Industry Leader
“I don't believe that in the future there will be a company that won't be a software company.”
Interview by KW
The number one rule at Booking.com is dedication to the client experience. Their goal is to provide the best possible customer experience, and their passion shines through the work that they do. Making travel more accessible is their ongoing mission.
Some encounters are pretty impactful, and meeting with Chief Marketing Officer at Booking.com, Pepijn Rijvers, really blew my mind. I used the website many time before, but there was so much more to discover about the travel company.
Founded in 1996 in Amsterdam by Geert-Jan Bruinsma, Booking.com has been part of the Priceline Group (PCLN) since 2005, which is the third largest e-commerce company in the world. Booking.com is present in 70 countries, available in 43 languages, employs 15,000 people, offers 25 million rooms, and books about 1.5 million rooms every 24 hours.
Talking with Pepijn, we try to understand how they get it done.
What do you like about data?
I think you are happier in life if you understand yourself, which essentially means finding truth by paying attention [to what] is important. I think that data is a great way to understand behaviour quickly of any group that you interact with. If you can have data on something, you can have a better understanding of it than if there were no data.
What do you dislike about data?
One of the difficult things is the attitude towards data. If you don’t have data, don’t freeze. I always talk about a true hierarchy. At the top, you have an absolute understanding of everything, which no human possesses. The next level of understanding is typically A-B experimentation. You literally measure behaviour, where all the circumstances are equal, with the exception of one thing. But then we draw conclusions with a 95% certainty interval, which means that one out of 20 decisions are wrong.
If you can’t do A-B experimentation, then its data modelling, which is fantastic, but even harder to draw conclusions from. There are also all kinds of external factors that you cannot predict or do not know.
And if you can’t do data modelling for a new idea, new company, or new board, you need to use an actual human being, because that is the best that you have. And if you don’t have that, you just gamble, at least you will learn something.
How do you manage all your responsibilities at Booking.com and how do you work with your different teams?
We are a bottom-up company: our culture is geared towards maximizing the effects of learning. What I spend the majority of my role on is looking at emerging markets, what type of investment we do as a business, what type of investment we want to make, what type of service we want to offer.
I spend lots of time on advertising approaches. I also spend a lot of time on future strategies, like where would Booking be in three years, five years, even ten years, and what’s required from a marketing standpoint in order to materialize that vision.
With all the data that Booking has on hospitality, do you ever foresee any hotel acquisitions?
It’s really unlikely that Booking will own and operate a hotel. It’s a totally different skill set. We stick to what we are good at: marketing, the discovery, and the actual fulfillment of a trip. That goes far beyond accommodation. We are, of course, way smaller in things to do with destination and transport. We are testing a lot there, where I think because of the mobile device, in the future we can play a very big role to facilitate anything you want to book on your trip.
Price is important?
Yes, we have 1.5 million property partners and each partner has roughly two room types, and every room type is typically, let’s say two rates: a non-refundable one and a more flexible [one]. Now, if you multiply all these price points, it’s more than 90 billion price points that we need to manage, which is incredibly complex, so I don’t think that Booking.com can be the cheapest on all those price points, but we know that on average we have the best price points than anyone out there.
You are so immersed in technology, what do you do to stay in the know of what’s happening in tech?
Luckily, in my position I got to speak directly to the vice presidents of product at Google, Facebook, and so on. So, I have very first-hand insider to a lot of the technology developments. I think technology is an enormous inhibitor of our business, so it is impossible not to be completely aware of what is going on.
I don’t have a technology background at all, by the way.
Interesting, and how you stay business minded? Do you listen to any podcasts?
I listen to podcasts, mostly music actually, I like reading about technology in short-form, like articles or by talking to people or talking with my team is a sort of learning style. I learn from talking. My brain materializes thoughts and vague concepts the minute that I’m forced to articulate them.
What are the most tech-advanced countries?
I think that the world is very not aware that China is leading the world from a technology point of view. Because they have no Google, no Facebook, no eBay - they created their own versions and they’re actually better. People live their life through WeChat. It’s very different already, and I think China is a small peek into what our world would look like in five to ten years’ time from now.
[The] U.S. obviously, because the large technology companies are there. Even in the top-five tech companies, two of them are Chinese and three are U.S. Booking.com is the first European one. As I mentioned, I don’t think there is a future where companies are not software companies. And as a result, I don’t think there will be countries that are not technological as a result.
What are the challenges of working with countries that are less technologically advanced?
Apparently, customer needs around travel is pretty similar across countries. I would say Asia Pacific is probably the most different from what you would find in mainland Europe or in North America.
What’s interesting is that around payment there is a lot of innovation happening right now. The payment infrastructure is very complex and therefore very expensive to start up in. So, what you see in financial technology is a lot of start-ups, and they all become successful first in their domestic environment. In India, they use Paytm, and in China people are using WeChat Pay, and then a lot of people use others. At some point, those things need to come together.
DTK Men was lucky to have had this opportunity to chat with Pepijn from Booking.com and get some insight in what it takes to be a leading e-commerce and technology-driven business.