Growth in AI visibility does not necessarily bring an increase in bookings
Booking Holdings is appearing increasingly often in AI tool responses, but that rise in visibility has so far had almost no impact on bookings. Traffic from large language models still accounts for less than 11 per cent of the company's total room nights.
Artificial intelligence is becoming an increasingly important part of the guest discovery process, but Booking Holdings has not yet seen a significant shift in actual bookings coming from ChatGPT and other large language models. Chief Financial Officer Ewout Steenbergen, during the second-quarter results announcement, confirmed that paid and organic referral traffic from LLMs together account for less than 1% of total room nights. That share has not changed significantly in recent months.
AI visibility is not yet the same as conversion
A more interesting signal comes from the second part of the funnel. According to data tracked by Booking Holdings via external sources, its brands frequently appear in the responses of AI platforms.
For Chief Executive Glenn Fogel, this has value even when the user does not immediately click through to Booking.com, Priceline, or Agoda. The idea is that presence in AI responses strengthens brand recognition and increases the likelihood that the traveller will later return directly to the platform.
For tourism industry That opens up a new question of measurement. AI can influence a traveller's decision without generating a classic referral that is easy to attribute to a specific channel.
The direct channel remains a key defence
Booking Holdings' B2C direct mix remained in the mid-60% range, roughly on par with last year, despite pressure from Google's search result changes and the AI Overviews feature.
At the same time, the company is developing proprietary AI solutions. Priceline is expanding its Penny assistant, while Agoda is using visual search that links hotel photographs with relevant guest reviews. The goal is to offer a more personalised experience than general AI platforms and keep the user within their own ecosystem.
AI is already delivering more measurable results within business operations. The cost of customer support per booking is falling at a double-digit rate.
Business is growing, but the acquisition cost is also rising
Booking Holdings increased gross bookings by 91% in the second quarter, while the number of room nights rose by 51%. Revenue reached $7.4 billion, up 81%, and adjusted EBITDA grew by 91% to $2.6 billion.
However, marketing costs grew faster, by 111%. That is precisely why AI at Booking Holdings currently looks less like a replacement for existing distribution channels and more like a new battle for visibility, brand recall and future user acquisition.
For us in the tourism industry, the message is clear: presence in AI answers could become important before its impact is clearly seen in referral traffic. Precisely for this reason, investing in AI visibility is an investment in the future.
