Kayak hits profitability and eyes European growth

Small moves, big gains for travel search site Kayak as it continues its low-profile creep into the consciousness of European consumers.

The US-based engine is poised to reveal details of a white-label deal with a major German portal and talks continue with a string of other third parties. It’s been a solid 15 months or so for Kayak since it launched in the UK.

The company says it is now profitable – news which will irk many of those determined to cast a gloomy spell over meta search as a sustainable business – but launches into new territories inevitably needs marketing spend.

This profitability appears to have come despite its acquisition of rival engine Sidestep in December 2007.

B2B partnerships appear to have been a key factor in Europe, where marketing appears to be the only way to seriously push a consumer site into the mainstream.

Keith Melnick, executive vice-president for corporate development, says: “White labels are definitely part of the strategy. We have had a lot of interest from publishers and other travel providers. If it is a travel content company that is not focused on search, it is a natural fit.”

Kayak already has a white-label deal with AOL in the UK as well as one with Orange, which it inherited in the merger with Sidestep.

Overnight, Sidestep in Europe was folded into Kayak – although both brands will remain in the US.

“There were two established brands in the US and we wanted to keep the momentum, but in Europe it made more sense to focus efforts on one brand,” Melnick says.

“If you look at traffic numbers, Kayak had more momentum and Sidestep was only in the UK and Ireland. With Kayak we had France and Germany and the URL for other countries. It was not really a tough choice.”

Kayak now also has websites in Spain, and most recently Italy. Melnick, who also heads up European expansion, is planning its next move. He says that the company is currently focused on growing in the European countries where it has a presence.

But what about sceptics? Unsurprisingly, Melnick says Kayak has not experienced the antipathy towards meta search that has surfaced recently in the UK, often in the pages and blog of Travolution.

“Part of it is critical mass and we can provide that. You also have the fragmentation on the supply side in Europe. I see the opposite – some of the agencies who took a wait-and-see approach are clamouring for meetings. There were some OTAs who, in the past, were not interested. They are very interested in working with us now.”

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