Good morning,
The travel industry took a hit at the onset of the pandemic. And for Trivago, a travel search site for accommodation deals that trades under the ticker TRVG, preservation started with managing what they could control—cutting costs.
“The majority of our cost is in marketing,” says Matthias Tillmann, CFO of Trivago, which is based in Dusseldorf, Germany and had annual revenue of 248.9 million euros (approximately $284 million dollars) in 2020. The company immediately scaled back across channels, from online marketing to brand marketing and TV ads.
Tillmann has worked at Trivago since 2016 in financial and marketing leadership roles. But he began his job as CFO in January 2020, as the global pandemic loomed. It was a time of intense collaboration, he says, especially with Trivago CEO Axel Hefer.
But Tillmann says he and Hefer have worked closely together before. “We both worked on Trivago’s IPO first, back then Axel was the CFO,” he told me. “It was an intensive time. Essentially, we worked day and night.”
“We both got to know each other very well, and we soon learned that we could trust each other,” Tillmann says. “And that was very important for me later when I took over as the CFO.”
Little did they know they’d be in another stressful situation again so soon.
“I could always turn to him and ask for his advice or his opinion … he trusted me and let me do what I thought was the right thing to do,” Tillmann says. “Working 24/7 in the first couple of months, you just had to trust each other.”
Along with cutting costs, Trivago also looked for opportunities.
“We thought about different scenarios like how the pandemic could have a longer impact on travel demand and behavior,” Tillmann explains. “One of the themes we developed was that people will first travel more locally, and leisure will come back before business travel.”
The company started building a local travel product to offer accommodation deals for nearby places, he says. “We developed this further throughout the pandemic and rebranded it recently as Trivago Weekend,” Tillmann says. The company’s stock has been on a bit of roller coaster, trading as high as $6.31 in January 2019, as low as $1.30 in November 2020, then $4.86 in March 2021, and ended trading Tuesday at $3.87 per share.
As CFO, Tillmann says he looks at many different KPIs, but “what ultimately determines our success is how effectively we acquire new users and how successfully we can convert those users into loyal Trivago customers; our return on advertising spend is one of our key metrics.” Another important metric is how many engaged users are coming back directly to the Trivago platform.
“We are very excited about the coming summer travel period,” Tillmann says. “To be honest, it has been a long and very difficult winter, in particular in Europe.” He attributes the challenges to high COVID-19 infection rates, slow progress on vaccinations, and restriction of travel. “But all that started to change around mid-April,” Tillmann says. He notes the acceleration of vaccinations, and people in the U.S. and the company’s core European markets are ready to spend the money they saved during the pandemic.
Tillmann says he always uses Trivago to book his own trips. His favorite trip pre-COVID-19 was to South Africa. “We did a road trip along the Garden Route—amazing, very beautiful, and you are completely out of the daily, busy life,” he says.
See you tomorrow.
Sheryl Estrada
sheryl.estrada@fortune.com
Big deal
There's a need for direct investment in technology and the workforce, according to EY's Power and Utilities Digital Transformation and the Workforce Survey released June 7. The majority of respondents of a global survey of 159 power and utility executives said the lack of skilled labor is challenging their ability to adopt digital technologies.
Going deeper
A Gallup poll published June 7 found that Americans are cautiously getting out more. About 22% of U.S. adults surveyed said they are completely or mostly isolating from non-household members. This percentage is down from 30% in April and 48% in January. About 38%—"easily the highest to date"—said they're not making any attempts to isolate, according to Gallup.
Leaderboard
Claire Bramley was named CFO at Teradata, a multi-cloud data platform for enterprise analytics, effective June 14, 2021. Bramley most recently served as global controller at HP Inc., where she's had an almost 15-year career. At Teradata, Bramley succeeds Mark Culhane, who will step down as CFO on June 13 but remain at the company until the end of June to assist in the transition.
Kevin Reynolds, CPA, was named EVP and CFO at River Valley Community Bancorp. Prior to joining the company, Reynolds was senior manager of financial institutions at Moss-Adams LLP.
Overheard
"They're pulling back on the hours they're looking to work based on what's happening in the crypto market. They're making side money and no longer looking to fill full-time hours."
—Irina Novoselsky, CEO of job site CareerBuilder, on crypto trading keeping people from finding full-time jobs, as told to Yahoo Finance Live.
