Peter Kern: Yes, thanks Mark. So on ChatGPT, I agree with you. It’s interesting. It has a ton of promise. It is early days. We’ve been studying it. I won’t say it’s moved the numbers in any way that you could see. And the customers who like to engage with it like to engage with it, lots of customers don’t need it or don’t choose to. I think the future though lies much more in a better integration, which will come as more large language models come out. And we figure out how to embrace them with our own data. Right now they kind of live separately and you can do a bunch of discovery with the tool and then save things and come investigate with us. Over time, there will be ways, I think, where we’re not sharing your personal data with chatGPT, but where we can combine their capabilities with our data and use that to serve you better.
So this is going to be an evolution of experience. That’s why I mentioned we’ve been learning, we’ve been studying where customers get stuck, what they can’t seem to do. Some of them don’t exactly know how to engage or start a conversation. So there’s a lot of work, not just by us, but by the industry around the large language models on prompts and other ways to get customers through it more easily. And I think all of those pieces will add up to more impact, but the impact now is basically the minimum, since you wouldn’t see it in the numbers. As for One Key, I think that’s more of a gradual build. Obviously, there’s a couple of different things you’re looking for. There’s the appeal of having a strong, broad, flexible, best-in-class rewards program to attract customers and make them choose us over other people.
And then there’s the back-end part of, then do they come back directly once you’ve got them in their One Key program and hopefully once you’ve got them to download the app and now do they exhibit the behaviors of coming back? So that second part takes longer because as we all know, some people don’t travel all that often, so it takes time for them to come back and book again, etc., even though many booked a lot. And then the first piece, we should start to see, as we literally just launched it, you may have seen the ads, the campaigns are out there, starting to put the messaging into all our performance marketing and anything that’s out there digitally, etc., into our out-of-home. So it will continue to build, and you’ll start to see it show up in all our marketing for all our brands.
And we believe that’s a hope that will continue to make intelligent consumers choose us because it will be a better value that gives them more back for their travel. So that part we should begin to see sooner, and that’s why we think that will start to have a bigger impact into the back-end of this year. But the longer-range part of return and direct and driving those things, that will take a little longer to play out in the numbers.
Mark Mahaney: Okay. Thank you very much, Peter.
Peter Kern: You bet.
Operator: Your next question comes in a line from Justin Post from Bank of America. Your line is open.
Justin Post: Great. Thank you. Sorry about the drop-off. Could you talk about the customer and the B2C customers? It seems like you’re trying to improve that quality base, and maybe the street doesn’t see it in the numbers yet. What gives you confidence there? Are you seeing higher repeat rates? You said you had some leverage in the quarter. Was that timing, or is there some real improvement you’re seeing on the B2C side on marketing leverage? And then one question on One Key. Starting to see some discounts on the site, do you think that allows you to better compete against booking? And who’s funding those? Thanks a lot.
Peter Kern: Maybe I’ll take those in reverse order. Take the sort of factual ones first. So yes, one of the pieces, not that relevant necessarily for the investment community, but that is important for the consumers, because we’ve expanded our member discounts as part of this One Key launch, so that where we used to have one level, basically, of member discounts, we now have, blue, silver, gold levels, and there are more discounts for higher tiered members, and that is part of the value proposition that we give to our consumers. Those are funded by our supply partners. It’s a way for them to get to better and better higher value travelers, and that is an important added feature that we launched with, and we will be expanding over time.
