Trivago Case Study: Strategic Analysis and Business Model Report

This report provides a strategic analysis of Trivago, a leading online hotel booking platform. It begins with an introduction to Trivago's business model, emphasizing its cost-per-click (CPC) revenue generation and global presence across numerous countries. The analysis then delves into Trivago's strategic group within the industry, followed by a detailed SWOT analysis, highlighting strengths such as its market position and product innovation, and weaknesses related to product marketing. The report also applies Porter's Five Forces model to assess the competitive landscape, including the threats of new entrants, bargaining power of suppliers and buyers, and rivalry among existing players. Furthermore, it examines Trivago's competitive advantages, such as its pricing strategies, sensitive search filters, customer service, and localized marketing approaches. The report concludes by discussing macro and micro-environmental factors that could impact Trivago's competitive advantage in the coming years.

STRATEGIC ANALYSIS
OF A CASE
STUDY/COMPANY

Table of Contents
INTRODUCTION...........................................................................................................................1
Question 1........................................................................................................................................1
Trivago business and their business model..................................................................................1
Question 2........................................................................................................................................2
Strategic group of Trivago...........................................................................................................2
SWOT analysis ...........................................................................................................................3
Porter's five forces model ...........................................................................................................4
QUESTION 3...................................................................................................................................1
Competitive advantage of Trivago ..............................................................................................1
QUESTION 4...................................................................................................................................2
Macro and micro environment affecting competitive advantage of organisation in next 5 years
......................................................................................................................................................2
CONCLUSION ...............................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
Strategic planning is one of the organizational management activity that is utilized to set
business priorities, concentrate resources and energy, assure that workers and another
stakeholders are performing towards same goals, strengthen operations, establish understanding
around intended results and adjust organizations functions. The present report is based on
Trivago, as leading organization in online accommodation or hotels booking industry. This study
explain core business of Trivago and their business model. It justifies company specific strategic
group and also evaluate business micro environment of firm. This report clarifies Porter's Five
forces model to analyze industry main players. Furthermore, it includes competitive advantage of
company and main trends or changes in business environment that can affect organization
business activities.
Question 1
Trivago business and their business model
Trivago is German multinational technology firm specialized in online related products
or services in hotel, meta search and lodging areas, they marketed with low case styling as
Trivago is the first hotel research tools in Germany, they expand their business in many countries
such as UK, India etc. firm became one of the biggest growing and well developed companies in
country with double profitability (Gonzalez, 2014). Enterprise served their services across 55
countries and run business effectively. They build up their headquarters in Dusseldorf, where
90% of organization workers work together within same goals and try to achieve it more than the
other companies. Company opened their offices in many countries such as Leipzig, Amsterdam,
Palma de Mallorca and Shanghai.
As compare to hotel price internet site, Trivago makes profit from marketing partners
mainly using a CPC- cost- per- click business model. Organization offers many facilities to
customers for choosing or selecting rooms in which they like to stay at best or affordable prices.
Booking hotels, hoteliers and another providers list rates and publicize on Trivago site, paying
for clicks accepted from company users. They provide free based versions and free of their hotel
manager goods, which hotel manager used to promote their services on organization websites.
Firm claims to be the world's biggest online hotels hunt site comparing rates from over than 1
million hotels and much than 250 hotels reservation sites globally. Websites includes more 190
million hotel rating and 15 million pictures and records over 120 million travelers each and every
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month. Expedia is one of their main shareholder, Expedia attempt is to direct bookings to its sites
by term of different adjustment, to how another websites rates their perceived. They provide
rates with the help of many websites reselling for travel wholesalers, where rooms will not be
gettable at time of hotel booking. Success in business only possible when company make
effective and ingenious plan, Trivago does that and succeed in marketplace where they increase
profit more than other and build good reputation as compare to another hotel search sites.
Company is the world's most wide used search sites as hotel searching with much than 80
million visitors. Many travelers visit their websites and compare their prices with other hotel
search websites from over 700,000 hotels.
Trivago's hotel search hub is the first of their types in Germany and have websites in 50+
countries. Their search tool look hotel booking websites for prices, reviews and images within
seconds. When customers select hotel, they straightly connect to partner sites to accomplish
booking. They offer free app services for their hotel search goods on both Android and iOS.
Their apps offers interactive displays and maps accommodations in next proximity to consumer's
current location, it is one of their app additional features.
Organization hotel search app listed in Mashable's 25 apps to save clients time and
money. Hotel managers is company B2B platform, they provide chains and hotels consumer
information to efforts to secure bookings and maximize business more and more. Hoteliers will
monitor their work performance, for example, see amount of side views, bookings and clicks
they receive. Firm focuses mainly on online marketing and invest money in it, just to make
marketing better than another companies in UK. By using television advertising organization
easily entered into new countries.
Question 2
Strategic group of Trivago
Within industry Trivago compare does the best comparisons, they compare hotel service
prices for customers and offer them great deals which helps to retain clients with them for longer
term period. With the help of comparison people get the bests offers and it saves money and time
on accommodation search. Comparison is one Trivago's business strategy that support to attract
customers towards them and garb the attention of others in world (Ramos and et.al., 2017). They
offer the best hotel booking prices as compare with another who charge high on each booking.
Organization hotel search permit customers to compare hotels costs in just a few clicks from
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more than 400 booking websites for 1.8 million in across 190 countries. Their hotels review and
a million pictures permit users to find out about more where they traveling. Marketing is one the
best strategy that helps to expand business in world and build positive image in marketplace
better than another. To get the extended overview of Triavgo's property, they show average
rating and extensive views from another booking websites for example, Expedia, hotels.com,
Agoda etc, organization makes it easy for clients to find details about their where they want to
go, including ideal hotel for them.
SWOT analysis
Strength- As one of leading hotel search organizations in industry, Trivago has
numerous strengths that support it to grow in marketplace. Their strength contribute in
penetrating new markets based and also helps to protect their market shares in current markets.
 Successful track evidence of integrating encomiastic organization through acquisition and
merge.
 Track record of producing or developing new goods- product innovation.
 Trivago is Highly successful at Go to market strategy for their services or products.
 Organization does the best comparison of hotels and offer the best prices to people.
Weakness- Weakness is the areas where company need to improve upon. With the help
of SWOT analysis they can improve their weakness and build their strategic position and gain
competitive advantages.
 Organization products marketing left a lot to be desired. Even though goods is success in
terms of sale but their aligning and different selling proposition is not clearly
characterized that lead to attacks in this segment from business competitors.
 They need to invest more in new technologies.
Opportunities- New trends in consumer behavior open up new marketplace for Triavgo.
They offer great deals of hotel prices and opportunities for customers to find out the best hotels
in world within affordable prices through their websites. Company provide the best facilities to
their workers and pay good wages to them that helps to retain talented people with them.
Threats- Sudden changes in government policies and law bring many difficulties for
organization that directly affect their business profitability and productivity.
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Porter's five forces model
Threats of new entrance- It reflects how new entrance impose threats to existing market
players or organizations. If industry will be gainful and barriers to enter industry will be low, it
attracts more companies and then threat of new entrants will be higher. Trivago face low threat
of new entrances because existing regulatory model imposes many difficulties to new companies
interested to enter into market (Indiatsy and et.al., 2014). In case new entrants required to fulfill
exact, time consuming regulatory demands which discourage new players from entering into
market. By developing brand loyalty Trivago tackle threat of new entrants.
Bargaining power of suppliers- This forces will be high for Trivago if provides have
particularly strong when cost to switch from one supplier to other is high for buyers. Company is
not well known and does not have adequate market information and if company have lacks of
price sensibility, it directly strengthens suppliers position against firm. By decreasing
dependency on suppliers company will tackle bargaining power of suppliers.
Bargaining power of buyers- Low switching price also maximize buyers bargaining
power. Bargaining power is weak and makes Trivago less competitive and generate their
revenue and increase profitability.
Rivalry among the existing players- there are only few numbers of players in market or
hotel search websites which does not make any difficulties for Trivago. Low rivalry shows
company face low pressure.
Threat from substitutes products- Available of substitute services and products makes
competitive challenging environment for Triavgo and other existing players.
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QUESTION 3
Competitive advantage of Trivago
As compare to the other competitive organisations such as Trip Advisor, Hotelscompare
and Hotelscombined Trivago is using various pricing and marketing strategies to gain the
competitive advantage. One of the key competitive strategy of the organisation is its pricing
strategy. The company focus on the price sensitive customers and thus the comparison of huge
range of hotel services and price attracts huge number of customers. Most of the competitive
organisations offers only attractive discounts and the details of the hotels (Khalilzadeh and
Tasci,2017).
Contrary to this Trivago use highly sensitive filters in its search options. Thus, customers
not only get comparison of the hotels on the basis of services but hotels are also classified as per
the needs of consumers. For instance most of the travels prefer to choose hotel which allow
flexible check in and check out time as per their needs or the hotels which gives Wi-Fi services.
It has been one of the most attractive feature which attracts customers. Earlier the hotel bookings
site and hotel collaboration leads to very limited number of options. However, Trivago provides
the comparison on the basis of price, services, additional facilities and specific needs of people
(Espinet, 2019). Thus, the travellers who are in search of wide range of choices find the Trivago
app and website very useful.
In order to create value for the customers the organisation is highly committed to the
quality of its services. For instance despite having collaboration with the hotels Trivago assures
that only correct reviews and feedbacks are presented on its site. Its consumers can access the
services of organisation at any place and instant along with the website organisation also has its
own mobile app (What's the Deal with Trivago?, 2017). The effective pricing and the sensitive
filtering of the hotels is the key source of its competitive advantage. Another important aspect
which assist organisation in creative value to its customers is its quick response to the complains
of its consumers (Vila and et.al., 2018). It has been also observed that when the customers who
make hotel bookings through the app are provided complete assistance from the organisation.
Thus even after booking consumers face any difficulty in the hotel than this online
booking app ensures that such reviews are taken seriously. As compare to the other related
organisations in the industry, the marketing strategy of Trivago is also one of the factor which
enhances its value. Instead of adopting a uniform pattern of promotion and marketing the

Trivago use specific advertisement strategies as per the culture and social factors of its operating
region. For instance in UK, USA, and Japan though company has same concept of Trivago girl
or Trivago guy but with different outlook and way of promotion. This unique marketing and
advertisement seeks to gain attention of the large number of customers.
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To enhance the customer experience the organisation uses live location of the users so
that they can search for the most affordable and nearby hotels. Along with the travellers the hotel
organisations are also important consumers of this hotel booking website. To meet the needs of
hotels, Trivago allows hotels to review their performance by various means such as number of
profile visitors and booking enquiries (Basbeth, Ghani and Sedyowidodo, 2018). The use of real
time images and comparison of hotels on various perspectives such as on the basis of room
occupancy or service provided is great way to meet the information needs of consumers.
QUESTION 4
Macro and micro environment affecting competitive advantage of organisation in next 5 years
Trivago is enjoying huge success on the basis of quality services provided by the
organisation. However, there has been rapid and significant changes in the micro and macro
business environment which can influence the competitive advantage and growth rate of
organisation in the coming years. These factors can be analysed as follows:
Micro factors:
With the globalisation talented and skilled employees have lot of opportunity to explore.
In order to retain the talented human resource organisation must emphasis on improving the
internal or micro factors. In the upcoming years with the business growth and expansion as the
number of teams will increase it will become more complex and challenging sustaining the
quality of teams and employees. Thus, Trivago must try to explore different leadership styles and
innovations in its practices so that the internal conflicts and inefficiencies in its internal
environment can be addressed (Polese and et.al., 2018). With the growth the organisational
structure and functional aspects must be improved. Thus, company must assure that its
development and growth plan meets the expectations of all of its stakeholders.
In future it is also possible that the sharing of responsibilities may create conflicts among
its stakeholders and thus the employees and investors may fail to meet the growing business
needs. Thus, with the growth Trivago must assure that it changes its policies and internal
infrastructure in a way such that it can maintain its growth and its consequences. There has been
strict competition from the other organisations as well. There has been strict competition from
the other organisations as well. Trivago may experience the challenges from the local or
domestic hotel booking services. Hence, to overcome this challenge organisation must regularly
focus on improving and enhancing its services (Fritsch and Sigmund,2016). For instance in next
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few years, organisation can increase its tie ups with other online booking platforms or even
restaurants as well. It will give rise to a complete new customers segment. To offer more value to
the customers Trivago can provide the flight ticket combo as well to its customers so that it can
overcome the increasing threat of competitors.
Macro factors:
Along with the micro factors Trivago must also become more concerned with the macro
environment factors which will change in few years. The first and the most dominating factor is
technology and legal changes. The technology is getting advanced day by day and thus company
must assure that its website and mobile app are safe and encrypted (Ehtiyar,Aksu and Kasalak,
2018). The negligence to technical efficiency may lead to customer dissatisfaction as well as
threat of replacement.
In order to deal with these challenges company must try to explore the innovation and
technical advancements which makes the booking experience of customers effective. There has
been great improvements in the data protection and privacy rights. Thus, to sustain the brand
value and customers Trivago must also assure that with growth it does not neglect the legal
aspects (With Its Clever Brand of Marketing, Trivago Is Way Ahead of the Competition, 2018).
For instance the company may address the legal conflicts with the hotels which does not have
good reviews. Thus, to avoid such conflicts Trivago must have proper planning and framework
so that such issues can be avoided prior to their occurrence.
To retain the competitive advantage company must also analyse the economic and social
factors. For instance the major business model used by Trivago is based upon pay per click and
advertisements. Thus, while promoting any product or services through advertisement company
must assure that the content produced does not harm the political and social sentiments. The
ignorance to this element can lead to major trouble or unnecessary conflict. The economic
changes can make the acquisition and merging processes very complex (Vargas-Sánchez and
Moutinho, 2018). If Trivago plans to merge with the local service providers in future then it must
also consider this aspect so that its merger with other online booking site can bring profits
without creating any complications.
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CONCLUSION
It can be concluded from the report that strategic planning and implementation plays
significant role in the development and growth of an of organisation. Through the case study of
Trivago it has been observed that the use of effective and competitive strategies can help
organisation to sustain its growth in not only domestic but in global market as well. It has been
also observed from the study that for the long term success of the business it is important to
create value which can retain customers for the long term. It is also analysed from the report that
for achieving the growth in this competitive business market Trivago must evaluate and develop
strategies as per the changing micro and macro business environment.
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REFERENCES
Books and Journals
Basbeth, F., Ghani, N.H.A. and Sedyowidodo, U., 2018, October. Smart Destination Branding:
The Need for New Capability and Opportunities for Entrepreneurship. In 2018
International Conference on ICT for Smart Society (ICISS)(pp. 1-5). IEEE.
Ehtiyar, R., Aksu, A. and Kasalak, G., 2018. Future’s Tourism: A Case Analysis with Qualitative
Research in Antalya Region.
Espinet, J.M., 2019. Big Data in Online Travel Agencies and Its Application Through Electronic
Devices. In Big Data and Innovation in Tourism, Travel, and Hospitality (pp. 31-55).
Springer, Singapore.
Fritsch, A. and Sigmund, H., 2016. Review platforms in hospitality. In Open tourism (pp. 229-
238). Springer, Berlin, Heidelberg.
Gonzalez, D., 2014. Online Security for the Business Traveler. Elsevier.
Indiatsy, C.M. and et.al., 2014. The application of Porter’s five forces model on organization
performance: A case of cooperative bank of Kenya Ltd. European Journal of Business
and Management. 6(16). pp.75-85.
Khalilzadeh, J. and Tasci, A.D., 2017. Large sample size, significance level, and the effect size:
Solutions to perils of using big data for academic research. Tourism Management.62.
pp.89-96.
Kreutzer, R.T. and Land, K.H., 2014. Digital Darwinism: Branding and Business Models in
Jeopardy. Springer.
Polese, F.and et.al., 2018. Social innovation in smart tourism ecosystems: How technology and
institutions shape sustainable value co-creation. Sustainability.10(1). p.140.
Ramos, C.M. and et.al., 2017. Framework for a hospitality big data warehouse: The
implementation of an efficient hospitality business intelligence system. International
Journal of Information Systems in the Service Sector (IJISSS). 9(2). pp.27-45.
Vargas-Sánchez, A. and Moutinho, L., 2018. New strategic developments in tourism. Strategic
Management in Tourism. pp.332-349.
Vila, T.D. and et.al., 2018. The Role of the Internet as a Tool to Search for Tourist
Information. Journal of Global Information Management (JGIM).26(1). pp.58-84.
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