Agoda: Perpetual Disruption and Post-Acquisition Challenges

Rob Rosenstein, co-founder of Agoda.com, had a difficult task ahead of him. Agoda was acquired in 2007 by a global online travel giant, Priceline Group. The terms of the acquisition were based on a three-year profit period after which Priceline would pay Agoda for the majority of the acquisition payment. However, in 2008, Agoda urgently needed to improve its revenue, and the Priceline Group board of directors was pessimistic about Agoda’s chances of meeting its profit targets. The general assumption was that the Asia-based startup’s assets would be eaten up and incorporated into the group as part of its much larger and more profitable Western brand. However, Rosenstein believed in the strengths of his company, which he founded with Michael Kenny in Singapore in 2005. Agoda.com was one of the first online travel platforms in Asia to expand its business globally, attracting travelers from all over the world. the world. However, by the late 2000s, Agoda had lost its hold in Asia with the arrival of global players in the market and increasing competition from Chinese online travel agencies (OTAs). Other challenges such as technological disruption, a fragmented and diversified Asian market, an unstable political environment in Thailand (Agoda’s largest office was in Bangkok at the time), and difficulties in attracting the right talent also hampered its growth path. In December 2009, growing concern for Agoda’s future led Rosenstein to sit down with his team and formulate a strategy that would allow Agoda to meet its profit targets within the designated three-year period through 2010. How could Agoda grow your business and your sales? How could you improve your marketing strategy, expand your offering, and attract more consumers to bookings on your website? How was Rosenstein able to organize the acquisition?

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