TripAdvisor has grown its commercial restaurant business by focusing on underpenetrated parts of Europe through TheFork. Now, the company has set its sights on South America.
— Danni Santana
TheFork, known as La Fourchette in its home European market, will add 3,500 bookable restaurants in 18 cities across eight countries through the acquisition, including in Brazil where it already has a market presence. TripAdvisor also has an active partnership with Restorando, in which it lists eateries on the company’s digital reservation channels.
According to Bertrand Jelensperger, senior vice president of TripAdvisor Restaurants, and founder of TheFork, Restorando currently covers 5 percent of the South American reservation market. TheFork’s immediate goal, he says, is to grow Restorando’s footprint to upwards of 40 percent, similar to TheFork’s market share in European countries, such as Spain, Italy, and France.
“To build up the marketplace, you need more restaurants,” said Jelensperger, adding that TripAdvisor’s involvement in the deal going forward will increase Restorando’s scope due to the travel review site’s growing restaurant count. “Both [TripAdvisor and TheFork] will also provide know-how in terms of sales, and go-to-market strategy,” he said.
Restorando will continue to operate under its current name and branding for a couple more months before switching over to TheFork, TripAdvisor says. Terms of the deal will not be disclosed. TripAdvisor has also not made a decision on whether to honor Restorando’s other existing partnerships.
TripAdvisor’s Growing Restaurant Footprint
TripAdvisor’s restaurant commerce business began four years ago with its acquisition of TheFork. At the time, the move was viewed as a way for the travel website to monetize customer reviews, and better compete with OpenTable, the restaurant reservations platform owned by Booking Holdings.
The company has since grown the number of bookable restaurants directly on its platform from 12,000 to over 52,000 last year by focusing on geographies competitors haven’t really penetrated, according to Ernst Teunissen, senior vice president, chief financial officer, and treasurer of the company. OpenTable currently counts more than 47,000 bookable restaurants on its platform in six countries.
On TripAdvisor’s recent fourth quarter earnings call, Teunissen said OpenTable’s restaurant base is highly skewed towards the U.S. and the UK, whereas TheFork has its strongest market presence across continental Europe and Australia.
The lack of competition in those locations, coupled with TripAdvisor’s own advertising products sold to restaurants on its platform, have paid off in increased revenue for the company. In the fourth quarter, TripAdvisor saw non-hotel earnings — comprised of experiences, restaurants and alternative accommodations — jump from barely any profits in the year prior to $8 million in the period. Overall revenue spiked 38 percent to $106 million.
“We’re placing our bets, right? And so, the bets we’re placing on our non-hotel side are clearly on experiences and restaurants,” said Teunissen. “We think the cards that we hold there are very strong, and we have nice leadership positions.”