And then, of course, Vrbo had nothing. Now Vrbo will have rewards, which Airbnb doesn’t have, etc. And you’ll be able to use it for your next Vrbo stay, but you can also use it to go to a hotel or a resort or take your family on a flight or whatever. So again, it just gives all of our customers a lot more ways to use it for a lot different occasions and for a lot different products. And ultimately, we’re trying to build a base of loyal customers that use us for all their travel needs that can go across whatever they need and spend more with us, buy more products from us, etc. So that’s the game. We have all these brands, all these capabilities. We wanted the customers to benefit from all of that. So the patterns we’re looking for is cross shopping, more items per customer, higher LTVs, more direct, more app-direct, etc.
So that’s what we think One Key really helps drive. As far as the puts and takes in the back half of bookings, your point about the smaller brands, as part of it, yes, the smaller brands that we have to emphasize for some time now are getting smaller and that drag is getting lighter all the time. We mentioned some of the things going on with insurance normalizing post-COVID and a few strange effects there. That’s normalizing in the back half of the year. And lodging continues to grow, B2C lodging continues to grow, for instance most through [indiscernible] but both brands are getting stronger in the back half after the tough comp. And so you’re basically getting the strong pulling more weight and getting bigger, the sort of noisy stuff making less noise.
And overall we see good velocity in the business right now and we’re seeing it continue and we feel good about all the product improvements. I mean this has also been a journey of improving product, improving conversion, improving sign-in, improving app-down, like all of those things are part of that journey. So every day they’re literally getting better and stacking up on themselves. So I think that’s a long journey and there’s no magic to why it’s going to hit next Tuesday, but with Vrbo’s migration done, with One Key, which is a huge amount of resource for us out the door, these things, the velocity of other innovation gets faster and faster. And that’s what we’re focused on.
Unidentified Analyst: Very helpful. Thank you.
Operator: Our final question comes from a line of Deepak Mathivanan from Wolf Research. Your line is open.
Deepak Mathivanan: Great. Thanks for taking the questions. Julie, can you help us with the full year guide on margin expansion? We’re almost into the peak travel season and you said that for 3Q, margin should be flat here on here. But anyway, you can frame for us what the full year margins can reach to. And then kind of related to that, how should we think about the headwind from fixed cost growth? You obviously have a little bit of a duplicative cost right now with all the replatforming efforts. Is there a timeline when we can expect this to somewhat sort of start to show leverage and maybe you can deploy them for other projects? Thanks so much.
Julie Whalen: Sure. On the margin side, the EBITDA side, obviously this quarter’s leverage certainly helps on the full year. We did guide to next quarter being more in line with last year. And that is, as you mentioned, the shift from the marketing spend that we have. But for all the things that Peter just alluded to, the strength of the business in the back half, particularly in the fourth quarter, we expect to see strong margin expansion in the fourth quarter that will help us on the year. So we’re going to be operating top line, which will leverage the entire P&L, including marketing leverage in the fourth quarter that we think will drive that expansion. From a headwind from a fixed cost perspective, certainly we are going to be aggressive as we move out of this year and come out of the transformation phase to finding efficiencies across the P&L.
As we’ve said, we have got redundant systems for very good reasons and migration, but it’s time that we’ll be starting to deprecate those systems and pulling costs out of the P&L, and whether that’s cloud costs, licensing and maintenance, repurposing some of the product and tech staff to now go on the offense and go after optimization and innovation instead of migration. There’s a lot of opportunity to really dig through the cost and pull that out as we move forward, but that’s probably more of a 2024 going forward focus. But certainly with all that optimization as well, we should be able to leverage the P&L next year. So super excited about that.
Unidentified Analyst: Got it. Thank you.
Peter Kern: Yes, I think that was the final question. So thank you all. Have a good Thursday. Appreciate your time. Take care.
Operator: That concludes today’s call. You may now disconnect your lines. Have a nice day.
