According to market intelligence software company eRevMax, Asia is now arguably the largest travel opportunity in the world due to rising disposable incomes, mobile Internet penetration, and a desire to explore; it predicts the Asian travel market will be worth US$155bil (RM620.2bil) by 2017, with 46% of travellers preferring to book hotels and flights online.

Most Asians would be more familiar with booking holidays with traditional travel agents and visiting sites such as Agoda and Booking.com for lodging. For flights, the go-to site would probably be AirAsia. What many may still not have latched on to is the fact that AAE Travel – a joint venture company between Expedia Inc and AirAsia – is headquartered in Singapore and oversees both Expedia and AirAsiaGo Business across Asia Pacific. Expedia, Inc chief financial officer Mark Okerstrom explained that after entering a joint venture with AirAsia in 2011, AAE launched 12 different points of sale for Brand Expedia around the region. Okerstrom said: “We’re very happy with the progress we’re seeing there so far. The great thing about South-East Asia is that it is a very attractive destination. And we’re finding that as we build our inventory there, the US and European traveller, as well as the intra-Asia traveller, just love to go there.”

Last February, Expedia announced that it had entered into an agreement with AirAsia Berhad to purchase an additional 25% equity interest of AAE, increasing its total ownership from 50% to 75%. “For us AirAsia has been a terrific partner,” Expedia, Inc CEO Dara Khosrowshahi said. “We had a decent position in Asia, but we wanted to aggressively invest in and expand Expedia’s scope there.”


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Khosrowshahi expounded on how most travellers call it “Asia” but how every single market in the region is unique. This, coupled with the fact that the Asian consumer is very different from consumers elsewhere, makes the task of marketing products in the region daunting.

“There is no Expedia in Asia,” he went on. “There are a number of local players, but there is no full-service Pan Asian online tour agency and we want to be that. We knew it would be very difficult to build a service that is global in scope but local, and fully relevant to the Asian consumer. So we felt we needed a local partner – one that understood Asian consumer behaviour, what their wants and needs were. That was one of the reasons we reached out to AirAsia.

“There was also a great deal of friendship and respect between (AirAsia founder) Tony Fernandes and our chairman Barry Diller, and that was really what started our entry into the joint venture.”

Khosrowshahi revealed that it had been a “terrific launch”. “And as we learned more about local wants and needs, we felt safe in increasing our stake. We now have data that tells us what Asian customers want, and certainly the joint venture is starting to bring scale and profitability in a way that is actually ahead of expectations.” AAE already has a very strong presence in north-eastern Asia including Japan, Taiwan and South Korea. “The next step is to go much deeper, and invest signficantly more in the South-East Asian countries. We’re off to a good start there, but along with AirAsia, we think that we can penetrate much more agressively into those territories.”