So our Predictions 2009 article was a rather nice collection of views from across the travel sector (thanks to those who contributed).
Now, as one would expect, we had a fair bit of correspondence and conversations following its publication which contained predictions which people would rather not put their name to.
One emailer suggested that the user review site realholidayreports.com site would be ripe for a takeover a la Holidaywatchdog and Holidaysuncovered.
Our correspondent said:
"It ranks very well like Holidaysuncovered did, and looks just as hideous prior to TUI purchasing it."
Quite.
After asking around it appears that Tripadivsor would feature in many people's list of likely buyers for the site.
We also got into a conversation with the founder of a new trip planning site which launches this year. He kindly sent us the business plan and - hey presto - the exit strategy has none other than Tripadvisor named as one of the companies it hopes would be interested in buying it.
So which sites do we think are likely takeover targets in 2009?
I think that with the weak "Great" British pound, the first thing to do is think which UK sites will be popular with major players in the US or Eurozone.
In Ireland I think that Budget Travel will have new owners as last time I checked their owners were Icelandic.
@Rob
That is an interesting point about the weak pound. I hadn't thought about it like that.
@Travo
IMO, one acquires non-product companies for
* team (staff)
* technology
* customer base / seo position (perhaps based on extensive content)
* defensive reasons
With travel companies shedding staff / going out of business - probably no need to acquire for that reason as staff are available on the market - although it used to be a great reason last year when there was a shortage.
With technology - maybe - but taking your tripadvisor exit example - they have plenty of technology in that sector - so if a startup launches something - it would be easier to copy than buy (even if copying is a riskier route).
Customer base / SEO optimised content - again - trip advisor wouldn't buy a yet to be launched startup for their customers / content. Someone who wants to compete (over the longer term) might - but they would only buy a company that mitigates their "build" risk - otherwise they would build (replicate) not buy.
Defensive reasons. Not sure tripadvisor would buy for that either! (and no one else is defending that position)
Travel companies tend to also exit for the value of their future product contracts (hence my explanation above would be for non product based companies)
Kayak aquired by Google
Travellerspoint aquired by Trip Advisor
Non travel:
Microsoft and Google fight it out over either/or Digg and Twitter.
Tripadvisor buys sites that aren't doing the same thing they are doing and where they can add value quickly and cheaply and see a big return. From what I've seen, they *especially* like to buy sites with little to no SEO done to them offering something unique in the travel space, or sites that don't do much in the way of revenue but where it'd be easy to tack on. This tactic allows them to pick up sites cheaply, boost revenue dramatically within a 1-3 year perspective, and thus actually make the purchases very worthwhile. I like this tactic; it makes sense where many other buy outs don't. But I clearly don't see them picking up another well ranking reviews site :)
There will be some acquisitions in the India OTA market; valuations are low and ther is huge growth potential.
The companies to watch out for are http://www.cleartrip.com and http://www.makemytrip.com. Either will be acquired by a company whose growth is slowing in the US / EU markets and need to demonstrate growth to the market/investors, by whom, I haven't got a clue.
TripAdvisor is buying at 2-3x revenue. Much less than the 6 - ++ you might have received last year.
Don't expect to get what you want..