Expedia, the online travel service with a vast network and a multitude of data, is embracing a two-pronged transformation strategy fueled by artificial intelligence (AI) and extensive data expertise. CTO Rathi Murthy believes that the combination of AI and the company’s wealth of data will enable Expedia to drive growth by bringing more of the travel industry online.

With top brands like Travelocity, VRBO, Hotels.com, Orbitz, Trivago, Wotif, and CarRentals.com, Expedia possesses a treasure trove of data. Stored on its AWS cloud, this amounts to a staggering 70 petabytes of traveler information. Murthy emphasizes the central role of data in Expedia’s operations, serving as the foundation for driving personalized experiences for their vast ecosystem of 168 million loyalty members and 50,000 business partners.

As AI continues to advance, Expedia is leveraging analytics and machine learning to fuel its personalization strategy. Murthy recognizes the disruptive potential of AI in the travel industry, and with recent advances like ChatGPT, Expedia’s extensive use of AI-driven analytics positions the company to spearhead industry evolution. With approximately 600 billion AI predictions annually from their massive data repository, the combination of data and AI holds significant power for Expedia.

Expedia has come a long way since its inception as a division of Microsoft in 1996. With over 21 brands and an extensive network of partners, including 3 million hotels and rental properties, 500 airlines and cruise companies, and car rental agencies, the company has tremendous growth potential. Despite its current market share of approximately 10%, Murthy estimates that only 20% of travel professionals and consumers currently use online systems for booking reservations. This untapped potential presents a significant opportunity for Expedia.

To capitalize on the potential of online travel bookings, Murthy has devised a two-pronged transformation approach. Firstly, Expedia aims to unify and integrate its infrastructure internally, creating a robust foundation for future growth. Secondly, the company seeks to lead the transformation of the entire travel industry by digitizing travel agencies and bringing them into the online realm. Expedia’s comprehensive digital transformation plan began prior to Murthy’s tenure, with over 90% of the company’s data now residing on the AWS cloud.

Expedia’s focus aligns with the consumerization of AI, where AI tools and platforms are increasingly accessible to ordinary users. Expedia recently incorporated OpenAI’s ChatGPT plug-ins to enhance conversational capabilities within their services, enabling travelers to seamlessly plan and book trips. By combining ChatGPT’s capabilities with Expedia’s travel-specific data, such as traveler preferences and booking patterns, the company can offer personalized itineraries and streamline the booking experience. Early implementations are showing promise, but analysts caution that there is room for improvement to deliver meaningful impact.

Expedia’s strong position in the AI era depends on collaboration with partners and the ethical use of AI. With its vast data platform and deep insights into booking behavior, Expedia aims to provide a more personalized experience in the post-pandemic era. By leveraging AI and machine learning-driven functions, the company can process and analyze data to deliver enhanced customer insights and drive deeper partnerships.

Murthy emphasizes the importance of governance, ethics, and privacy in the AI space. Expedia is committed to being a fair and responsible marketplace, ensuring that information is shared in a secure and privacy-conscious manner. Collaboration and industry-wide best practices are crucial to maximizing the benefits of AI and using it for the greater good.

As Expedia harnesses the power of AI and data, it is poised to reshape the online travel industry, offering personalized experiences and transforming the way people plan and book their trips.

By Impact Lab