History

TripAdvisor was founded by Stephen Kaufer, Langley Steinert, Nick Shanny, and Thomas Palka in February 2000. Kaufer has stated that the original idea wasn’t a user generated social media site to swap reviews, “We started as a site where we were focused more on those official words from guidebooks or newspapers or magazines. We also had a button in the very beginning that said, “Visitors add your own review”, and boy, did that just take off. Original financing was obtained from Flagship Ventures, the Bollard Group, and private investors.

In 2004, the company was purchased by IAC/InterActiveCorp.

In August 2005, IAC spun off its travel group of businesses under the Expedia, Inc. name.

Headquarters in Needham, Massachusetts

In April 2009, TripAdvisor launched its official site in China, since then it has indexed more than 20,000 hotels and restaurants information and customer reviews, and made top lists, becoming one of the biggest travel websites as of July 2011.

In September 2010, SmarterTravel, part of TripAdvisor Media Group, launched SniqueAway (now Jetsetter), the first members-only site where each travel deal is endorsed by the people.

In March 2011, TripAdvisor informed all registered TripAdvisor members that an unauthorized third party had stolen some of TripAdvisor’s email list and might use it to create spam messages. No passwords or other information was stolen. This happened shortly before many other companies reported similar thefts of the addresses on their email lists.

In April 2011, it was announced that Expedia would split into two publicly traded companies by spinning off the TripAdvisor brand of travel sites. According to Expedia CEO Dara Khosrowshahi, the move “allows the two businesses to be pure plays and to operate with the proper amount of focus to grow respectively. The spin-off was completed in December 2011 with a public offering.

According to a July 2011 PhoCusWright survey of 3,641 respondents, solicited at random through a pop-up invitation link on TripAdvisor.com and commissioned by Trip Advisor, “98% of participants found that TripAdvisor’s hotel reviews … accurately reflect the experience.”

TripAdvisor becomes the world’s largest travel site, with nearly 280 million unique monthly visitors.

In April 2012, the company launched a connection to Facebook that lets users select reviews from people in their social graph.

In October 2014, Trip Advisor released a new feature, “Just for you”, offering tailored hotel recommendations based on the user’s preferences and search history on the site. This feature mirrored the “Tribes” feature launched on competitor site Gogobot in 2013.

In November 2018, the company incorporated food-ordering and delivery service, DoorDash, into its restaurant listings.

Revenue model

As per its annual shareholder report, Trip advisor earns 43% of its revenues through its two most significant advertising partners, Expedia and Priceline (and their subsidiaries). It derives a substantial portion of its revenue from advertising and redirections. These include revenues from the sale of advertising, mostly through click-based advertising and, to a lesser extent, display-based and subscription-based advertising. The company also has master advertising contracts with its advertising partners.

Its advertisers usually depend on this advertising to generate sales leads, customers, bookings, or revenue and profit on a cost-effective basis. Click-based advertising revenue accounts for the majority of its advertising revenue. Its CPC pricing for click-based advertising depends, in part, on competition between advertisers. Its advertisers currently focus more on traffic volume rather than per-click profit. Hence they do not reduce the CPC. As of 2017, Trip advisor employed 3,217 part time and full time employees, of whom 51% were located in USA.

Acquisitions

In May 2007, TripAdvisor acquired Smarter Travel Media operator of SmarterTravel.com and BookingBuddy.com; SeatGuru.com; TravelPod.com; and Travel-Library.com.Also in May 2007, TripAdvisor acquired The Independent Traveler, Inc., publisher of Cruise Critic.com and IndependentTraveler.com

In February 2008, TripAdvisor acquired Holiday Watchdog, user-generated travel site in the U.K.In July 2008, TripAdvisor acquired Virtualtourist, a travel website with reportedly over 1 million registered members and OneTime.com, a travel comparison site.

In July 2008, TripAdvisor acquired a majority stake in FlipKey.com, a vacation-rental website.In October 2009, TripAdvisor purchased Kuxun.cn, China’s second-largest consumer travel site and hotel and flight search engine.Kuxun was later sold to Meituan.

In June 2010, TripAdvisor acquired the United Kingdom’s largest independent vacation rental website, holidaylettings.co.uk

In July 2011, TripAdvisor announced its acquisition of Where I’ve Been, a Chicago-based Travel Facebook app for an undisclosed sum.

In October 2012, TripAdvisor announced its acquisition of Wanderfly, an NYC-based travel inspiration website for an undisclosed sum.

In April 2013, TripAdvisor announced its acquisition of Jetsetter, an NYC flash sale site.

In June 2013, TripAdvisor announced its acquisition of GateGuru, an NYC-based flight and airport information mobile app for an undisclosed sum.

In October 2013, TripAdvisor announced its acquisition of Oyster.com, an NYC-based hotel review and photography website, for an undisclosed sum.

In May 2014 TripAdvisor acquired Vacation Home Rentals and Tripod.

In May 2014, LaFourchette agreed to be acquired by TripAdvisor, for $140 million in an all cash deal.In July 2014, TripAdvisor announced its acquisition.

In August 2014, TripAdvisor acquired Viator, Inc. for $200M.

In October 2014, TripAdvisor acquired mytable and restopolis.

In January 2015, TripAdvisor announced its acquisition of Iens, a Dutch restaurant review website and SeatMe, a Dutch website for reserving seats in a restaurant. According to TripAdvisor, this is to stimulate growth in The Netherlands.

In April 2015, TripAdvisor acquired Portuguese startup BestTables

In May 2015, TripAdvisor acquired Australian startup Dimmi for $25 million

In August 2016, TripAdvisor acquired New York City startup Citymaps.com, which developed a social mapping site and original cross platform map engine based on OpenStreetMapdata.

In October 2016, TripAdvisor announced its acquisition of Couverts, a Dutch restaurant review, a Dutch website for reserving seats in a restaurant. According to TripAdvisor, this is to stimulate growth in The Netherlands.

In April 2018, Tripadvisor acquired Icelandic startup, Bokun, the provider of travel businesses with management software to assist with bookings and reselling services.

Controversy and fraudulent reviews

TripAdvisor has been the subject of controversy for allowing unsubstantiated anonymous reviews to be posted about any hotel, B&B, inn, or restaurant

Approximately 30 hotels have been blacklisted by TripAdvisor for suspicious reviews, including a Cornwall hotel that bribed guests to leave positive reviews of the hotel.

TripAdvisor has stated that reviews are not posted to the website instantly, but are subject to a verification process which considers the IP address and email address of the author, and tries to detect any suspicious patterns or obscene or abusive languageThe website also allows the community of users to report suspicious content, which is then assessed by Tripadvisor staff.

In September 2011, the UK Advertising Standards Authority (ASA) launched a formal investigation into TripAdvisor after receiving a complaint submitted by online investigations company KwikChex that its claims to provide trustworthy and honest reviews from travelers are falseThe ASA found that TripAdvisor “should not claim or imply that all its reviews were from real travellers, or were honest, real or trusted”,and as a result of the investigation, TripAdvisor was ordered to remove the slogan “reviews you can trust” from its UK web site. It changed its hotel review section slogan to ‘reviews from our community.’

TripAdvisor stated that the branding change had been planned for some time and that changes began in June 2011, before the ASA investigation. ASA commented that “it was concerned that consumers might be fooled by fraudulent posts since the entries could be made without any form of verification,” but recognised that TripAdvisor used “advanced and highly effective fraud systems” in an attempt to identify and remove fake content.

In 2012, an action was brought in a Sheriff Court in Scotland, by a guesthouse owner who claimed damages for malicious statements. TripAdvisor asserted that the Scottish courts lacked jurisdiction The outcome of this case was called a “landmark victory”, as the pursuer (plaintiff) secured two points of law in the UK

• TripAdvisor conceded that it could be sued in the UK’s jurisdictions (having previously claimed to be outside the remit of the Scottish legal system because it is based in Massachusetts);
• TripAdvisor’s terms of use constituted a contract, which was actionable/enforceable by the business being reviewed.

The case was found to involve issues relating to the Unfair Terms in Consumer Contracts Act, 1977: these issues were referred to a higher court in Stornoway.

In 2012, TripAdvisor was fined $80,000 by the U.S. Department of Transportation for violating new fair trading regulations requiring taxes and fees to be shown for prices quoted for airfares.

In May 2013, a fake restaurant was set up by a disgruntled businessman and reportedly had diners looking for the eatery in an alley filled with garbage cans. The fake listing went undetected on TripAdvisor for over 2 months until it was exposed by KwikChex.

In March 2014, TripAdvisor’s Chinese site came under scrutiny because KwikChex uncovered that a reviewer had reviewed 51 Parisian restaurants in one month, while also reviewing 50 Hotels in other countries.

In December 2014, the Italian Antitrust Authority fined TripAdvisor €500,000 for improper commercial practices on the TripAdvisor website.The Italian Authority stated that Tripadvisor and its Italian arm should stop publishing misleading information about the sources of the reviews. In June 2015, a fake restaurant created by a newspaper rose to the top of the site’s rankings in Italy.

An ex-hotel manager at Meriton says that guests were offered inducements to change ratings they left on the site.

Dietmar Doering, a German hotelier based in Sri Lanka accused TripAdvisor of hosting malicious reviews of his resort The Cosy Beach in Marawila. He claimed he was compelled to take legal action for the estimated damages of US$500,000.

In November 2017, TripAdvisor was cited in two reports from the Milwaukee Journal Sentinel and CBS News that it was responsible for deleting numerous reviews that raised red flags of complaisant criminal responsibility by resorts in Playa del Carmen, a popular tourist resort in the Yucatán Peninsula of Mexico. The reports cited that the company deleted reviews from two women who were raped at the Iberostar Paraiso Maya in separate incidents 2010 and 2015 respectively, one of which involved a hotel security guard. After assurances from hotel staff they would help out and contact the authorities but failed to take any follow-up action, the women took their advisories and warnings to TripAdvisor, which deleted their reviews. The first victim, Kristie Love, had her review eventually put back up on TripAdvisor’s site successfully, while in the case of the second victim, Jamie Valeri, the company refused to budge after citing her report as “hearsay.” The reports also highlighted at least a dozen other incidents at hotels and resorts across Mexico, including that of a 29-year-old man who was raped by a massage therapist at a resort in the same area, where reviewers had attempted to warn people through reviews on the company’s site about criminal incidents that the resorts and local authorities had failed to pursue any criminal or legal action for, only to have those reviews either taken down or declined for posting by TripAdvisor.

In November 2017, Oobah Butler, a journalist for Vice Media, used fake reviews to boost a nonexistent restaurant named The Shed at Dulwich to the top of Tripadvisor rankings for restaurants in London. When questioned about its fraud-prevention systems, TripAdvisor responded that this type of fraud was not generally seen, because unlike artificially good reviews for a real restaurant, creating good reviews for a non-existent restaurant is not profitable.