Expedia’s new CEO, Mark Okerstrom, doesn’t see tech and business as two disparate departments within the online travel giant.
That was one of the takeaways from GeekWire’s interview with Okerstrom last year, on Expedia’s 20th birthday, when he was still serving as the company’s chief financial officer. Yesterday, the Bellevue, Wash.-based company announced that Okerstrom will take over as chief executive as Dara Khosrowshahi departs for his new gig as Uber’s CEO.
Okerstrom has been groomed for the role, according to Expedia Chairman Barry Diller. In an internal email to employees, obtained by GeekWire, the media mogul said “there was no other candidate considered other than Mark.”
Okerstrom took over as Expedia’s financial chief in 2011 and helped guide the company through a series of acquisitions, including Trivago, Orbitz, and HomeAway. Before taking the CFO gig, Okerstrom was Expedia’s senior vice president of corporate development. Prior to joining the online travel giant, he was a consultant with Bain & Company in Boston and San Francisco.
The new CEO wasn’t available for an interview this week, but many of the topics we discussed previously relate directly to his new job. Continue reading for edited highlights from our May 2016 discussion, providing a glimpse into what Expedia will look like under his leadership.
On Expedia’s tech and product strategy: “You know if you look over the course of the last five years, we’ve really gone from a business that was doing just over $20 billion in gross bookings, total travel value, up to last year we had over $60 billion. This year, with bringing Orbitz into the mix, will be significantly more. [Editor’s Note: Gross bookings for 2016 were nearly $72.5 billion.] And really at the center of it, yes, the acquisitions have been important but it’s really been this re-energization of the technology culture, putting tech and product first, that has ultimately enabled us to get the core business — the flagship brands of Expedia and Hotels.com, for example — really on a big growth path. Once we got them really growing — both volume, revenue, and profits — and we built a set of global operations and technology capabilities, that’s actually what opened up the opportunity for us to do the acquisitions. It wasn’t a situation where we went and bought a bunch of things to make earnings grow. We had built up this set of capabilities and we recognized that around the world, Australia with Wotif, here in the U.S. with Travelocity and Orbitz, for example, that there were a number of iconic travel brands that have fallen behind in technology and product, didn’t have the scale that we had in all of the supply relationships we’ve got, across hotels and airlines and car, and that we have the opportunity to actually make our product better for their customers on a significantly lower cost basis.”
On Expedia’s acquisition strategy: “We’re a company that was built on acquisitions. I mean, yes, our name is Expedia Inc. But Expedia.com, which was the original acquisition back in 2001, is just a piece of a much larger portfolio. So mergers and acquisitions is in our DNA. We think a lot about it. We start with the corporate strategy of this business and we do acquisitions to fill strategic needs and achieve financial aim. You know we’re not doing it reactively. We’re not doing it in response to some sort of threat. It’s a very thoughtful approach and as a result, when you make thoughtful acquisitions, it makes integrations go a lot easier because they’re planned out and they’re thought through well in advance.”
On Expedia leadership: “The most important message is that at heart, Expedia is a technology company and what got Expedia and all of our brands to be where they are today is innovation, top caliber engineering talent, tech leaders who are business leaders and that’s what we have become. The distinction between business and technology in the halls of Expedia is as ceasing to exist with every day that passes and the next 20 years are going to be so exciting because we do have scale. We do have amazing people around here and all they’re focused on is making sure that we have the most amazing products for our customers on one side and suppliers on the other side.”
On moving Expedia’s headquarters from Bellevue to Seattle: “First of all, it’s going to be an amazing space. Forty acres of waterfront, walking distance to downtown Seattle…It’s going to be a fantastic location and we are building this space that’s going to look a lot more like you what see right here [in Bellevue] then things looked like when we were over and Factoria where people were stuck in their offices. It’s going to be a great place to work. It’s a great place for people to collaborate which, that’s what happens at Expedia. Ultimately we’re solving multi-disciplinary challenges and people need to get together and whiteboard things and that space is going to be a special place to go. It’s going to encourage that type of thing.”
On retaining employees during the relocation: “One, it’s still a long ways away (now slated for 2019). And two, it’s going to be an amazing place. Over time, it’s possible we can see some attrition. But Expedia is such an awesome place to be, let alone work, and I think ultimately that overpowers a lot.”