TripAdvisor Grows Its User Base By Going Down Under

With over 60 million unique visitors per month, TripAdvisor (NASDAQ:TRIP) is the leading online platform for travel related reviews for destinations, accommodations and restaurants. Travel businesses advertise on TripAdvisor’s platform to benefit from its large audience and global reach. With localized versions of its website in 29 countries, the company derives over 90% of its  revenue from the sale of advertising.

Last month, TripAdvisor signed a multi-market partnership with “Tourism Australia” to promote the country as a travel destination amongst its users. Australia is amongst the top 8 destinations in the world, measured by international tourism receipts; and we feel that the deal could contribute to the company’s growing user base.

With the year long deal, it is the first time that the travel website features a partner in its drop down menu and offers a fully functional itinerary planning tool. The trip planner puts together an itinerary based on the selection criteria of the user, which they can share across social networking sites.

The media spend by “Tourism Australia” on the TripAdvisor campaign, which is available on various TripAdvisor sites in US, Canada, France, Italy, UK and Germany with localized services for each site, is £500,000. ^[1]

Australia attracted approximately 6 million visitors in year ending April 2012, up 4% from 2010. With the introduction of the innovative trip planner tool featured in the campaign, which allows a user to better plan their trip, we feel that the website has the potential to attract a higher user base.

We estimate the number of monthly visitors to register a 15% increase this year.

We are in the process of updating our current price estimate of $27.37 for TripAdvisor.

See our complete analysis for TripAdvisor’s stock

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1. TripAdvisor goes down under with media partnership, Tnooz, June 28, 2012 [↩]