Presentación de PowerPointB2B PARTNERS. B2B distributors trust that we offer superior technology...
Transcript of Presentación de PowerPointB2B PARTNERS. B2B distributors trust that we offer superior technology...
INVESTORDAYTaking LatAm’s Leading Travel Platform to the Next Level
DECEMBER 2019 NEW YORK CITY
This presentation includes forward-looking statements. We have based these forward-looking statements largely on our current beliefs, expectations and projections aboutfuture events and financial trends affecting our business and our market. Many important factors could cause our actual results to differ substantially from thoseanticipated in our forward-looking statements, including: political, social and macroeconomic conditions in Latin America; currency exchange rates and inflation; currentcompetition and the emergence of new market participants in our industry; government regulation; our expectations regarding the continued growth of internet usage ande-commerce in Latin America; failure to maintain and enhance our brand recognition; our ability to maintain and expand our supplier relationships; our reliance ontechnology; the growth in the usage of mobile devices and our ability to successfully monetize this usage; our ability to attract, train and retain executives and otherqualified employees; and our ability to successfully implement our growth strategies. We operate in a competitive and rapidly changing environment. New risks anduncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statementscontained in this presentation. The words “believe,” “may,” “should,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “will,” “expect” and similar words are intended toidentify forward-looking statements. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies,capital expenditures, financing plans, competitive position, industry environment, potential growth opportunities, the effects of future regulation and the effects ofcompetition. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or to revise any forward-lookingstatements after the date of this presentation because of new information, future events or other factors, except as required by law. In light of the risks and uncertaintiesdescribed above, the future events and circumstances discussed in this presentation might not occur or come into existence and forward-looking statements are thus notguarantees of future performance. Considering these limitations, you should not make any investment decision in reliance on forward-looking statements contained in thispresentation. This presentation includes industry, market and competitive position data and forecasts that we have derived from independent consultant reports, publiclyavailable information, industry publications, official government information, other third-party sources and our internal data and estimates. Independent consultant reports,industry publications and other published sources generally indicate that the information contained therein was obtained from sources believed to be reliable. The inclusionof market estimations in this presentation is based upon information obtained from third-party sources and our understanding of industry conditions. Although we believethat this information is reliable, the information has not been independently verified by us. Trademarks and service marks appearing in this presentation are the property oftheir respective holders. This presentation includes data from Euromonitor. Information sourced to Euromonitor is from independent market research carried out byEuromonitor International Limited as part of its annual Passport research. Euromonitor makes no warranties about the fitness of this intelligence for investment decisions.This presentation is strictly confidential, is for informational purposes only and may not be relied upon in connection with the purchase or sale of any security. You may notdisclose any of the information contained herein to any other parties without the company’s prior express written permission. This presentation is made pursuant toSection 5(d) of the Securities Act of 1933, as amended, and is intended solely for investors that are either qualified institutional buyers or institutions that are accreditedinvestors (as such terms are defined under Securities and Exchange Commission (“SEC”) rules) solely for the purpose of determining whether such investors might have aninterest in a securities offering contemplated by Despegar.com, Corp. Any such offering of securities will only be made by means of a registration statement (including aprospectus) filed with the SEC, after such registration statement is declared effective. No such registration statement has been declared effective as of the date of thispresentation. This presentation shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in anystate or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
DISCLAIMER
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AGENDARAPID ADAPTATION TO LOCAL MARKETS
LOW-COST DELIVERY MODEL UNIQUELY SUITED FOR LATAM
STRONG FINANCIAL POSITION CAPTURE GROWTH AND LEAD CONSOLIDATION
CLOSING REMARKS
DECEMBER 2019 NEW YORK CITY INVESTOR DAY
2
3
4
5
6
7
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COMPETITIVE POSITIONING AND STRATEGIC INITIATIVES
WIN-WIN VALUE PROPOSITION FOR CUSTOMERS AND PARTNERS
EFFICIENT CUSTOMER ACQUISITION & RETENTION
BEST IN CLASS DIGITAL PRODUCT
1
PABLO MONTIVERO ARAYACHIEF BUSINESS DEVELOPMENT OFFICER
GONZALO ESTEBARENACHIEF COMMERCIAL OFFICER
ALEXANDRE MOSHECOUNTRY HEAD BRAZIL
SPEAKERS
DAMIAN SCOKINCHIEF EXECUTIVE OFFICER
ALBERTO LOPEZ GAFFNEYCHIEF FINANCIAL OFFICER
LEANDRO MALANDRINICHIEF PRODUCT OFFICER
ANDRES PATETTA CHIEF MARKETING OFFICER
ALEJANDRO STEIN CHIEF CUSTOMER AND OPERATIONS OFFICER
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KEY THEMESFOR TODAY
1
2
3
4
6
Leading OTA in LatAm, a large market with unique preferences that require rapid adaptation across geographies
Strong brand with a scalable and flexible business model to drive growth and ensure consumer loyalty, which positions us as the Partner of Choice
Delivering growth even as we currently navigate an adverse macro environment
Investing in multiple strategic initiatives for value creation and broadening our value proposition
UNDERPENETRATED
UNIQUE CUSTOMER PREFERENCES
FRAGMENTED SUPPLIER BASE
LARGE
GROWING
Leading LatAm OTA in an attractive and growing market
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DESPEGAR INVESTOR DAY DESPEGAR INVESTOR DAY
The LatAm Travel Market is over 2.5 x the Size of India’s, and is Growing Faster than in Western Europe and the US
GDP 1US$ BN
Per Capita 1GDP US$
2,726
2,064
8,268
43,284
4,627
9,347
20,580
62,869
INDIA LATAM 3WESTERNEUROPE 3 US
46
10%
72
11%
116
6%
166
9%
406
3%
499
5%
565
4%
719
7%
Source: (1) Imf As Of 2019. (2) Euromonitor 2019 Data. Source Euromonitor Considering Only Airlines, Lodging, Attractions And Car Rentals. (3) LatAm Takes Into Account 45 Countries And Western Europe Considers 25 Countries.
Travel Market 2US$ BN
Travel Market Expected Growth 2(CAGR 18-24)
Travel Market Expected Size 2024 2
US$ BN
Online Travel Market Expected Growth 2(CAGR 18-24)
LatAm Market2.5x India
8
DESPEGAR INVESTOR DAY DESPEGAR INVESTOR DAY
Growth Potential Supported by Attractive Economic and Secular Trends
GROWTH INDISPOSABLE INCOME LATAM
W. EUROPE US
EXPECTED CAGR 2018 - 2024 1 3% 2% 2%
Sources: (1) Euromonitor 2018 Figures. (2) Euromonitor 2018 Figures. Digital Commerce Per Capita In 2018. (3) Euromonitor 2018 Figures. Smartphone Possession in 2018
LOW BANCARIZATIONLEVEL
CREDIT CARD OWNERSHIP 1 54% 95% 203%
INCIPIENT DIGITAL E-COMMERCE
E- COMMERCE PER CAPITA (USD) 2 265 1.125 4.966
MOBILEPENETRATION
SMARTPHONE PENETRATION 3 62% 71% 84%
TRAVEL AS A WAY TO CAPTURE DISCRETIONARY SPEND
ALTERNATIVE PAYMENT METHODS
ACROSS PLATFORM INITIATIVES
MOBILE FOCUS
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DESPEGAR INVESTOR DAY DESPEGAR INVESTOR DAY
Moreover, the LatAm Online Travel Market is Underpenetrated and Presents Significant Room for Growth
Sources: Euromonitor (1) 2019 Data . Intermediaries Online Sales/ Intermediaries Offline Sales in Gross Bookings. (2) 2019 Data. Total Mobile Travel Gross Bookings To Residents.
ONLINE LATAM TRAVEL PURCHASES ARE GROWING 1
SIGNIFICANT GROWTH IN LATAM MOBILE TRAVEL SALES 2
2011
0
5
10
15
20
25
2013 2015 2017 2019 2021 2023
US
D B
N 19% CAGR
ON OFF
LATAM LATAM LATAMWE WE WEUS US US
70%
30%
59%
41%
51%
49%
57%
43%
45%
55%
39%
61%
47%
53%
39%
61%
32%
68%
2013 2018 2024
10
DESPEGAR INVESTOR DAY DESPEGAR INVESTOR DAY
A Customer Base with Unique Preferences that Require Rapid Adaptation Across Geographies
LATAM TRAVEL GLOBALTREND
UNIQUETO
LATAM OUR STRATEGY
40% Travel spend is in packages 1 Focus on Complete Trips
69% Bought online & offline over past year 2Acquisitions and partnerships to balance our online presence
30% Purchased in installments to safeguard against FX volatility (60% Br & Arg) 1
Offer broadest range of installment financing options, mainly in Arg & Br
19% Purchased travel through Boleto (Brazil) 3 Broadest range of alternative payment methods
40% Annual travel budget spent on short trips 2 Launched Getaways
72% Say promotions and prices are the most influential factors in the decision process 4
One promotional campaign every two weeks in key markets
14% Value advice Launched Inspiration
Source: (1) Consumer Survey Conducted By Mckinsey In Brazil, Argentina, Colombia, Chile, Peru And Mexico (May 2017). (2) 2017 Prm’s “Online Travel Market Brazil, Mexico, Colombia, Argentina, Peru And Chile”. (3) Despegar Brand Tracking - Representative Sample: 1526 Brazilian Travellers - September 2019. (4) Despegar Market Insights. Customer Satisfaction Tracking. Unbranded Research On General Population Conducted Through Outsourced Online Panels. July 2019
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DESPEGAR INVESTOR DAY DESPEGAR INVESTOR DAY
201565 Airlines18 Low Cost 1
201967 Airlines21 Low Cost 1
Source: (1) OAG Data. (2) Euromonitor 2018 Figures. % of Gross Bookings. Includes international and domestic flights.
LATAM 2
60%
40%
2015
TOP 4AIRLINES
ALL OTHER
85%
15%
2015
TOP 10HOTELS CHAINS
ALL OTHER
69%
31%
2018
TOP 4AIRLINES
ALL OTHER
44%
56%
2018
93%
7%
2018
TOP 10HOTELS CHAINS
ALL OTHER
50%
50%
2018
US 2
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A Fragmented Supplier Base Across LatAm Reinforces the Value and Revenue Potential
DESPEGAR INVESTOR DAY DESPEGAR INVESTOR DAY
SIGNIFICANTSCALE
Our Competencies Provide Us With Unique Competitive Levers
DYNAMIC CULTURE
STRONG BRAND
DEEP LOCALUNDERSTANDING
AGILEPLATFORM
DISTINCTIVECOMPETENCIES
COMPETITIVELEVERS
Win-Win Value Proposition for Customers and Partners
Efficient Customer Acquisition & Retention
Best-in-Class Digital Product
Rapid Adaptation to Local Markets
Low-Cost Delivery Model Uniquely Suited for LatAm
Strong Financial Position to Capture Growth and Lead Consolidation
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DESPEGAR INVESTOR DAY DESPEGAR INVESTOR DAY
We Are Further Strengthening Our Competitive Levers
DRIVE HIGHER MARGIN PACKAGES
ENHANCECUSTOMER
LOYALTY
BUILD ON LEADING MOBILE APP
POSITION
COMPETITIVELEVERS
WIN-WIN VALUE PROPOSITION FOR CUSTOMERS AND PARTNERS
EFFICIENT CUSTOMER ACQUISITION & RETENTION
BEST-IN-CLASS DIGITAL PRODUCT
RAPID ADAPTATION TO LOCAL MARKETS
LOW-COST DELIVERY MODEL UNIQUELY SUITED FOR LATAM
STRONG FINANCIAL POSITION TO CAPTURE GROWTH AND LEAD CONSOLIDATION
CLIENT BASED ANALYTICS &
SEGMENTATION
EXPAND REACH ACROSS PLATFORMS
PAYMENTSOPTIONS
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Doubling our size within next five years, with increased profitability and solid cash flow generation
5-YEAR VISION FURTHER EXPANDING REGIONAL LEADERSHIP WITH STRENGTHENED COMPETITIVE SET
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Generating and Capturing value from Customers and Partners:
1
Increasing repeat rateAugmenting ASP Attracting a larger client audience Financing growth via reduced customer fees
2
Becoming the Dominant Platform and Must Have Partner5
3 Strengthening our Competitive Levers
4 Leading the consolidation of the Travel Space in Latam
DECEMBER2019
WIN-WIN VALUE PROPOSITION FOR CUSTOMERS & PARTNERS
ABOUT _
SPEAKERS _
GONZALO ESTEBARENACHIEF COMMERCIAL OFFICER
PABLO MONTIVERO ARAYACHIEF BUSINESS DEVELOPMENT OFFICER
DESPEGAR INVESTOR DAY
Despegar Benefits from a Diverse and Sustainable Revenue Stream Based on a Win-Win Value Proposition for Customers and Partners
STRATEGIC PARTNERS
Strategic partners leverage Despegar’s leadership position to grow their businesses
TRAVEL PARTNERS
Travel partners trust our ability to bring incremental revenues at the
most efficient cost
CUSTOMERS
1/4 of revenuesCustomers trust we offer them best value for their money and
serve them through their channel of choice
B2B PARTNERS
B2B distributors trust that we offer superior technology and travel supply
PARTNERS
3/4 of revenues 17
DESPEGAR INVESTOR DAY
STRATEGIC PARTNERS
TRAVEL PARTNERS B2B PARTNERS
Despegar Benefits from a Diverse and Sustainable Revenue Stream Based on a Win-Win Value Proposition for Customers and Partners
CUSTOMERS
1/4 of revenuesCustomers trust we offer them best value for their money and
serve them through their channel of choice
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DESPEGAR INVESTOR DAY
+270
+400
+500k
6
+6,000
1 WE SOURCE
2
3
4
5
6
$
CAR RENTALS
AIRLINES
CRUISE LINES
PRIVATELY NEGOTIATED FARES
>30%
PROPERTIES WORLD-WIDE
ACTIVITIES
Clients Trust That We Offer Unbeatable Value for Their Money
+30kDIRECTLYSOURCED
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We leverage our scale to source the best and most attractive deals
Over 30% of our transactions include a privately negotiated fare
DESPEGAR INVESTOR DAY
Custom packages for specific segments and travel occasions
One-stop shop solution
Peace-of-mind
As we bundle we gain access to better rates and margins while offering a discount
1 WE SOURCE
2 WE BUNDLE
3
4
5
6
$
Clients Trust That We Offer Unbeatable Value for Their Money
20
DESPEGAR INVESTOR DAY
24/7 customer support
>75% first-contact resolution
Cross channel support through direct chat/call
1 WE SOURCE
2 WE BUNDLE
3 WE CARE
4
5
6
Clients Trust That We Offer Unbeatable Value for Their Money
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DESPEGAR INVESTOR DAY
PRE-PAID IN LOCAL CURRENCY
NO-INTEREST-INSTALLMENT
SPLIT PAYMENTS
CASH AND NON-CREDIT CARD FINANCING
1 WE SOURCE
2 WE BUNDLE
3 WE CARE
4 WE ARE AFFORDABLE
5
6
Clients Trust That We Offer Unbeatable Value for Their Money
22
DESPEGAR INVESTOR DAY
Cross-Platform Strategy Aimed at Accelerating Online Growth, Leveraging Select Off-Line Expansion
% of people in each category
Purchased only online last year
Purchased online and offline last year
Purchased only offline last year
LatAm travelers are cross-channel consumers -69% of those who purchased a trip bought online, but 40% of this base also bought offline
PURCHASED ONLINE AND/OR OFFLINE LEISURE TRIPS IN THE LAST YEAR 1
43
26
31
% Share of those who purchased travel
MOTIVATION FOR CHOOSING PREFERRED PLACE TO PURCHASE TRAVEL 1
Affordability
Trustworthy
Advisory
Assortment
Special Offers / Discounts
Payment methods / Financing
Easy purchase process
Good attention & post sales service
Other attributes
21
16
14
12
11
11
6
6
4
Source: (1) 2017 Prm’s “Online Travel Market Brazil, Mexico, Colombia, Argentina, Peru And Chile”
1 WE SOURCE
2 WE BUNDLE
3 WE CARE
4 WE ARE AFFORDABLE
5 WE ARE CLOSE
6
NEW
23
DESPEGAR INVESTOR DAY
Seamless Shopping Experience, Addressing Customers’ Need for Advice and Trust
SINGLE TOUCHPOINT
RESEARCH – GET INSPIRED
Confirmation via email and mobile
NPS Post-PurchaseCall Center (compared to Site)
Call Center ASP vs Site(Oct YTD 2019)
+5.1 pp OCT 19 +72%
SELECTION & BOOKING
CONFIRMATION
Despegar customer service, both online and
call center
Desktop and mobile
Phone
1 WE SOURCE
2 WE BUNDLE
3 WE CARE
4 WE ARE AFFORDABLE
5 WE ARE CLOSE NEW
6Call Center GB (% of Despegar)(Oct YTD 2019)
4.9% 24
DESPEGAR INVESTOR DAY
Double dip in flights!
More efficient customer acquisition
Increase repeat rate
Improve customer base activation
Accelerate non air growth
HOW THE PROGRAM CONTRIBUTES TO DESPEGAR GOALS?
Wide multi-product offer
No blackout dates
Exclusive customer supporthotline for “Global” tier. Seamless account management
Redeem points + cash
PROGRAM FEATURES DELIVERINGA UNIQUE VALUE PROPOSITION
Single member can consolidate all points
PARTNERS
1 WE SOURCE
2 WE BUNDLE
3 WE CARE
4 WE ARE AFFORDABLE
5 WE ARE CLOSE
6 WE REWARD
NEW
NEW
$
Clients Trust That We Offer Unbeatable Value for Their Money
TO BE ROLLED OUT
ONLY IN BRAZIL
25
DESPEGAR INVESTOR DAY
Despegar Benefits from a Diverse and Sustainable Revenue Stream Based on a Win-Win Value Proposition for Customers and Partners
TRAVEL PARTNERS
CUSTOMERS
B2B PARTNERS
STRATEGIC PARTNERS
Strategic partners leverage Despegar’s leadership position to grow their businesses
26
PARTNERS
3/4 of revenues
DESPEGAR INVESTOR DAY
Strategic Partners Leverage Our Leadership Position to Grow
BANKS AND FINANCIAL PARTNERS GDS TOURISM BOARDS$ $ $
27
DESPEGAR INVESTOR DAY
PARTNERS
3/4 of revenues
Despegar Benefits from a Diverse and Sustainable Revenue Stream Based on a Win-Win Value Proposition for Customers and Partners
STRATEGIC PARTNERS
TRAVEL PARTNERS
CUSTOMERS
B2B PARTNERS
B2B distributors trust we offer them superior technology and travel supply
28
DESPEGAR INVESTOR DAY
We Offer B2B Partners the Most Efficient Tools to Grow Their Sales with Superior ROI
Partner CommissionsRevenue Management
Promotional ratesMultiple payment methodsVerified reviews
Voucher to the passenger24/7 customer support Less than 40 seconds standby
POST BOOKING
MAXIMIZE BENEFITS
FEATURES
Integrated pre-paid hotel direct inventory through our API solution, aiming to become their main provider for the region
Ctrip assumes full after-sales attention
Opportunity to expand the product offer
NEW
WHITE LABELS
+10k AFFILIATES
API CONNECTIONS
DESPEGAR INVESTOR DAY
PARTNERS
3/4 of revenues
STRATEGIC PARTNERSCUSTOMERS
B2B PARTNERS
Despegar Benefits from a Diverse and Sustainable Revenue Stream Based on a Win-Win Value Proposition for Customers and Partners
TRAVEL PARTNERS
Travel partners trust our ability to bring incremental revenues at the
most efficient cost
30
DESPEGAR INVESTOR DAY
We Offer Travel Partners the Most Efficient Tools to Grow Their Sales with Superior ROI
OUR BROAD AND DIVERSE TOOLKIT
AUDIENCESOPAQUINGPACKAGING
SEGMENTED CLIENTS
TRAVEL PARTNER’S NEEDS DISCOUNT PRICES
LIMITED $ TO GROW THEIR BUSINESS
OTHER CHANNELS
MARKETING
HIGHLIGHTINGSORTINGLOYALTY POINTS
$
31
DESPEGAR INVESTOR DAY
Partners invest an additional 5-10% of their net sale price to participate in our Preferred Partners Program
Highlighting and preferred sorting
Default selection for Packaged Products
Higher awareness through marketing activities (e.g. SEM, newsletters, etc.)
Resulting in strong return on investment for our Partners
Despegar leverages its demand steering capabilities to generate incremental sales
100 92
5-10 PP
PREFERRED PARTNERNON PREFERRED PARTNER
PARTNER NET SALE PRICE** (index = 100)
SALES GROWTH YoY IN USD** (index = 100)
100140
40-50%
PREFERRED PARTNERNON PREFERRED PARTNER
Case Study: Our Preferred Partners Program for Hotels is a Widely Accepted Tool to Boost Sales
ROI = +200%
$
32
DESPEGAR INVESTOR DAY
Looking Ahead: Enhanced Value Proposition Driving Partner Revenues, As We Capture Share and Steer Demand, while Customer Revenues are Resilient
STRATEGIC PARTNERS
As we gain scale and consolidate regional leadership, we become an even more attractive partner and see more willingness to invest in Despegar
TRAVEL PARTNERS
As we increase our ability to steer demand, travel partners are re-allocating
their marketing dollars to Despegar
CUSTOMERS
Resilient customer revenues As we strengthen our value proposition
with loyalty, unique products and easier access and affordability, we see
customers willing to pay for our service
B2B PARTNERS
As we provide more financing and payments options, more features ease of use and a wide inventory, they increasingly prefer our platformPARTNERS
33
Partner revenues are increasingly relevant
DESPEGARTHE PARTNER OF CHOICE
34
DECEMBER2019
EFFICIENT CUSTOMER ACQUISITION AND RETENTION
ABOUT _
SPEAKER _
ANDRES PATETTACHIEF MARKETING OFFICER
DESPEGAR INVESTOR DAY
Strong Investment in Branding Has Resulted in Leading Brand Awareness Across LatAm
UNAIDED BRAND AWARENESS 2
US $1.4BN+ INVESTED SINCE OUR FOUNDING 1
1999 2018
BRAND INVESTMENTS1999 - 2019
1
2
3
4
5
6
7
8
9
10
11
12
13
14
41%
33%
24%
22%
15%
14%
12%
11%
9%
8%
6%
5%
5%
3%
41%
31%
30%
23%
34%
29%
12%
25%
7%
0%
3%
0%
11%
0%
32%
38%
0%
18%
0%
0%
14%
0%
1%
31%
17%
20%
0%
0%
62%
34%
24%
35%
0%
3%
15%
0%
2%
0%
3%
2%
0%
34%
48%
35%
23%
18%
0%
0%
8%
0%
41%
0%
2%
0%
0%
34%
40%
26%
54%
16%
0%
0%
5%
0%
19%
0%
3%
0%
0%
0%
45%
25%
53%
26%
0%
1%
11%
0%
4%
0%
1%
0%
0%
0%
DESPEGAR
TRIVAGO
LATAM
BOOKING
CVC (TA)
GOL
AIRBNB
AZUL
AVIANCA
VOLARIS
EXPEDIA (TA)
BESTDAY (TA)
SUBMARINO (TA)
ALMUNDO (TA)
4,16 4,27 4,53 4,10 4,10 4,20AV. COUNT OF
RECALLED BRANDS
Source: (1) Despegar’s Internal Data. Marketing Investments Include Marketing Personnel As Of March 31st 2019 (2) Source:Despegar Market Insights Brand Tracking. Unbranded Research On General Population Conducted Through Outsourced Online Panels. Sep- 2019(3) TA = Travel Agency
36
DESPEGAR INVESTOR DAY
Strong Organic Traffic Makes Despegar Less Dependent on Other Sources and Reduces Our Marketing Spend
DESPEGAR - DIRECT MARKETING as a % GB YoY Chg.
DESPEGAR TRAFFIC BREAKDOWN JAN-OCT YoY
NON PAID TRAFFIC 1
PAID TRAFFIC
3.27 3.21 3.18
MA
RK
ET
ING
DIR
EC
T C
OS
T %
OF G
B
201920182017
65%
35%
62%
38%
69%
31%
201920182017
(1) Despegar´s Internal Data. Non Paid Traffic includes paid branded keywords
SEO accounts
for only 12% of total traffic
100116 121
AIR MARKET SHARE GROWTH - JAN-OCT, BASE 2017
3%
37
DESPEGAR INVESTOR DAY
Despegar Has One of the Highest Traffic Volumes in LatAm
201920182017 201920182017
TRAFFIC EVOLUTION vsLOCAL PLAYERS 1
201920182017
APP
SITE
73%
27%
66%
34%
63%
37%
600
400
200
0
800
600
200
0
400
COMPETITOR 2
COMPETITOR 3
COMPETITOR 5COMPETITOR 1
COMPETITOR 6
COMPETITOR 7
COMPETITOR 4DESPEGAR
COMPETITOR B
COMPETITOR C
COMPETITOR A
COMPETITOR D
DESPEGAR
DESPEGAR´S TRAFFIC BY PLATFORM (VISITS) 2
(1) Similar Web + App Annie Adjusted With Internal Data(2) Despegar´s Internal Data. Visits Jan - Oct
TRAFFIC EVOLUTION vsGLOBAL PLAYERS 1
38
WE DO NOT PURCHASE TRAFFIC, WE PURCHASE REVENUES
39
DESPEGAR INVESTOR DAY
Proprietary Technology Along with Flexible Toolkit Are Key to Driving Profitable Revenue Growth
GB
EBIT
TRAFFIC
MARKETING SPEND1
CONVERSION RATE
PRICE2
INSTALLMENTS3
LOYALTY4
ATTRIBUTION MODEL
CROSS DEVICE ID
OPTIMIZATION
LTV SEGMENTS
NEW
40
DESPEGAR INVESTOR DAY
FAST GROWTH IN STAND-ALONE PACKAGE TRANSACTIONS 1
100 125 142
201920182017
SH
AR
E O
F T
OT
AL
TR
AN
SA
CT
ION
S
(1) Source Despegar’ S Internal Data. Transactions Jan- Oct
EVOLUTION OF ITEMS SOLD PER VISIT 2
(2) Source Despegar’s Internal Data. Items Jan- Oct
100 116 133
201920182017
Marketing Initiatives Driving Higher-Margin Sales
41
CAGR 17-19
19%CAGR 17-19
15%
DESPEGAR INVESTOR DAY
SHARE OF TRANSACTIONS PER DEVICE 1
67% 61%
26%
74%
33% 39%
MOBILE
DESKTOP & OTHER
201920182017
MOST DOWNLOADED OTA APP IN THE REGION 2
57.1 MILLION CUMULATIVEAPP DOWNLOADS 3
Stars Rating on Apple App StoreBased on 140k reviews 4
4.7
Stars Rating on Google PlayBased on 164k reviews 4
4.3
Mobile Transactions up +15% 3Q18 to 3Q19
Source: (1) Despegar’ S Internal Data. Transactions Jan-oct. (2) Despegar is iOS App Store and Google Play apps most downloaded OTA apps in Latin America for the period from 2012 to 2018. (3) Downloads based on internal data, and as of June 30, 2019(4) Includes reviews for both Despegar and Decolar apps on iOS App Store and Google Play as of September 30th, 2019 42
Steering Demand to Higher Conversion Mobile Platform
43
PUSH PROMOTIONAL CAMPAIGNS ARE KEY TO DRIVING THE
PURCHASE DECISION IN LATAM
DESPEGAR INVESTOR DAY
Strongest competitive position in mobile, with
room for further migration
Brand awareness and traffic
Looking Ahead: We Aim to Leverage Our Marketing Assets to Optimize Customer Acquisition
KEY MARKETING ASSETS MARKETING STRATEGIC GOALS
1 Drive loyalty among higher LTV customers
2 Continue to improve personalization and accuracy with who we engage and when.
3 Further diversify traffic sources
+
+
Flexible toolkit to maximize revenue elasticity
44
DECEMBER 2019 NEW YORK CITY INVESTOR DAY
COFFEE BREAK
45
DECEMBER2019
BEST-IN-CLASSDIGITAL PRODUCT
ABOUT _
SPEAKER _
LEANDRO MALANDRINICHIEF PRODUCT OFFICER
47
PRESENCE THROUGHOUT THE ENTIRE CUSTOMER JOURNEY
DESPEGAR INVESTOR DAY
BEST TALENT IN LATAM
One of the most aspirational digital companies in LatAm
Selective hiring process
Low turnover
+ 1000 Tech talents
AGILE
Agile methodologies and structure
Team divided into autonomous and multi-disciplinary squads. Each team is responsible for the life cycle of the product
WE ITERATE AND LEARN FAST
+1600
User interviews, surveys and tests
1 every 2 minutes
Projects / Stories online
A/B tests
Deployments: 700 per day
+4700
+210
Agile Tech Team Executes on Ideas in a Nimble MannerDESPEGAR INVESTOR DAY
48
DESPEGAR INVESTOR DAY
Leading Tech Facilitates Delivery on Our Value Proposition
CUSTOMER CENTRICITY
Personalized and segmented features tailor-made for Latin Americans
PRODUCT OFFERING
Unique content, bundled packages and trips in the preferred one stop shop
APP IS KING
Driving engagement across each stage of customer journey
CROSS PLATFORMS
Superior end-to-endcustomer experience
DESPEGAR INVESTOR DAY
49
DESPEGAR INVESTOR DAY
BUNDLING CAPABILITIESBROADEST AGGREGATED INVENTORY TRIPS
Product Offering: One-Stop-Shop
UNIQUE CONTENT
+300 30 K +450
1411
BUNDLING CAPABILITIES TRIPS
DESPEGAR INVESTOR DAY
MY TRIP SELF MANAGEMENT EXCLUSIVE KEY FEATURESDIFFERENTIATED SHOPPING EXPERIENCE
App is King: Driving Engagement
EXCLUSIVE KEY FEATURESMY TRIP SELF MANAGEMENT
DESPEGAR INVESTOR DAY
CUSTOMIZED FOR LATIN AMERICANS
Customer Centricity
PERSONALIZATIONSEGMENTATION
A B C
52
SEGMENTATION
A B C
52
PERSONALIZATION
DESPEGAR INVESTOR DAY
CUSTOMEREXPERIENCE
CROSS JOURNEY STAGES CROSS DEVICES CROSS CHANNEL
Cross Platforms: Superior Experience Everywhere
53
CROSS DEVICES CROSS CHANNEL
DESPEGAR INVESTOR DAY
FOCUSED EXECUTION
Looking Ahead: Many Enhancements on the WayDESPEGAR INVESTOR DAY
ADDING VALUE THROUGH
CONTINUOUS INNOVATION
CREATIVITY AND INNOVATION
CUTTING-EDGE TECHNOLOGY
LEARNINGS
ACHIEVEMENTS
- Bundling- Demand steering- Inspiration- Post-sale self mgmt- Cross channels tools- Mobile APP- Payment methods- Loyalty program
and more
54
DECEMBER2019
RAPID ADAPTATION TO LOCAL MARKETS
ABOUT _
SPEAKER _
ALEXANDRE MOSHECOUNTRY HEAD BRAZIL
DESPEGAR INVESTOR DAY
Despegar’s Strong Local Presence Enables Four Key Competitive Differentials
Rapid reaction to local market opportunities and/or threats
Understanding of local marketdynamics and creation of local commercial events
Development of customer-led experiences to cater to local needs
Customization of regional platforms to fully address and capture local market characteristics
56
DESPEGAR INVESTOR DAY
Example: Implementation of “Surprise Weekend Sale” of major domestic airline
AWARENESS(Friday, 3pm)
SET-UP(Friday, 3:30pm)
GO-LIVE(Friday, 7pm)
COMMUNICATION(Friday, 8pm)
Informed that weekend sale would be taking place starting late Friday (only possible due to intense and recurrent commercial interactions)
Leverage pre-designed templates to create specific Landing Page and Internal alignments (Marketing, Legal, Sales, Revenue Mgmt)
Real-time monitoring of airline website to track moment of go-live. Upload of Landing Page and promotions on Decolar.com
Communication sent to entire client base (push notifications, email alerts, online ads, ...)
TOTAL IMPLEMENTATION TIME -5 HOURS
57
Being Local Speeds-up Reaction Time, Shortening Time-to-Market to Capture Unplanned Opportunities
DESPEGAR INVESTOR DAY
INDUSTRY- WIDECOMMERCIAL EVENTS
DECOLAR-LEDCOMMERCIAL EVENTS
DECEMBER
Commercial opportunities that are easily available to any player, with result diluted across the industry.
Commercial opportunities that require local presence to be planned and implemented,with result captured solely by the player.
Carnaval
Consumer Day
Brazil Week
Black Friday
Christmas
FEBRUARY / MARCH
MARCH
SEPTEMBER
NOVEMBER
OCTOBER
Winter Holidays Travel
Aniversario Decolar
Despegar Discount Week
Tourism Week
App Week
APRIL
JUNE
SEPTEMBER
SEPTEMBER
58
Local Footprint Favors Understanding of Market Dynamics and Tailoring Commercial Strategies
DESPEGAR INVESTOR DAY
PROACTIVELY APPROACH PROVIDERS TO ASSIST THEM IN ACHIEVING THEIR LOCAL GOALS
LEADS TO NEGOTIATING SIGNIFICANT AND EXCLUSIVE DISCOUNTS FOR OUR CUSTOMERS
Commercial conditions for Aniversário Decolar included:
Providers in ~90 destinations among hotels and activities500
1,100 Airlines routes from 10+ international airlines and 2 domestic airlines
6 Car rental companies
EXPECTED ACTUAL
D40 D35 D30 D25D180
100
80
60
40
20
0
D20 D15 D10 D5 D0
Potential support from Despegar To increase Load Factor on this flight
DAYS BEFORE FLIGHT
Expected vs. Actual Passengers for Airline A, Route 1
AIRLINE A, ROUTE 1AIRLINE A, ROUTE 2
AIRLINE B, ROUTE 1AIRLINE B, ROUTE 2
59
Firstly, by Positioning Despegar as a True Local Partner to Key Providers, Helping Them Achieve Their Local Goals
DESPEGAR INVESTOR DAY
WEEK 24(June 9th -15th)
WEEK 25(June 16th - 22nd)
Mon Tue Wed ThuSun Fri Sat Mon Tue Wed ThuSun Fri Sat
BEACH(Caribbean / NE Brazil)
WINTERSouth America / Brazil
USACANADA
CULTURE(Europe / Brazilian capitals)
LAST CALL
60
Secondly, by Establishing Strong Relationships with Financial Partners to Deliver Value to Customers
61
TRUE CUSTOMER-LED EXPERIENCES ARE ONLY
POSSIBLE WITH DEEP LOCAL EXPERTISE
DESPEGAR INVESTOR DAY
Local Knowledge Enables Despegar to Deploy Regional Platforms with Customized Features to Leverage Results, Such as “ Pasaporte Despegar”
PARTNERSHIP WITH BEST POSITIONED BANK IN EACH LOCATION TO LAUNCH CO-BRANDED CREDIT CARD
TAILORED PROMOTIONS TO ENHANCE PROGRAM RESULTS AND LEVERAGE PROGRAM ASSETS
Increased points earned for trips (flights, packages, hotels) based on locations and/or providers
Differentiate number of points necessary for redemption based on provider and product
Launch of Co-Branded Credit Card in partnership with Santander Brasil
Passaporte points earned on everyday purchases + additional points earned on purchases made on Decolar
62
DESPEGAR INVESTOR DAY
In Summary, Strong Local Presence Enables Development of Key Competitive Differentials Across LatAm
Rapid reaction to local market opportunities and/or threats
Understanding of local marketdynamics and creation of local commercial events
Development of customer-led experiences to cater to local needs
Customization of regional platforms to fully address and capture local market characteristics
63
DECEMBER2019
LOW-COST DELIVERY MODEL UNIQUELY SUITED FOR LATAM
ABOUT _
SPEAKER _
ALEJANDRO STEINCHIEF CUSTOMER & OPERATIONS OFFICER
DESPEGAR INVESTOR DAY
Centers of excellenceTailor made processes with partners
Senior management with deep knowledge and experience
Adapt to changing market conditions
An Efficient Delivery Platform Creating Room to Invest in Growth
2019F20182017
FULFILLMENT COSTS
100 99*89
73
18%
annual
savingsOPERATING LOSSES AND FRAUD
10088
72
2019F20182017
(*) Restructured Business Model To Focus On Customer Needs 65
DESPEGAR INVESTOR DAY
(*) www.reclameaqui.com.br
Implementing a 3-Year Customer Experience Transformation
NPS POST-TRIPINDEXED Reclame Aqui Index*
NOVEMBER 2019
7.4
201920182017
100
108111
REPUTATION BRAZIL
Q3 19Q1 18
5.5
7.46.9
6.9
6.4
6.0
66
DESPEGAR INVESTOR DAY
Monthly rules managed Promotions - Dynamic & Diverse
Transactions with installmentsCustomized Financing
Proprietary platform integrating multiple providers
Multiple partnerships fostering range of innovations in the e-travel industry
Approval Rate - Deep customer knowledge
Countries Local vs Cross Border
Payment Options Andean Region has 21% of Sales via non card Payments
Unique Payments Capabilities, Difficult to Replicate
BEST OFFERING
SUPERIORPERFORMANCE
20
Use Behavioural Data
Optimize Payment Network for Acquirers & Issuers
Bilateral Agreements
Recovery Strategies
91%
150+ 3K
+50%
FIRST TO MARKET
1
2
3
67BOLETO
DESPEGAR INVESTOR DAY
Capturing synergies as we grow organically and inorganically
Expanding use of behavioral data and biometrics to optimize decisions
Driving incremental self-service adoption in customer care
Anticipating customer needs, eliminating unnecessary friction
Looking Ahead: Opportunities to Capture Further Value
1
2
3
4
68
DECEMBER2019
SOLID FINANCIAL POSITION TO CAPTURE GROWTH AND LEAD CONSOLIDATION
ABOUT _
SPEAKER _
ALBERTO LOPEZ GAFFNEYCHIEF FINANCIAL OFFICER
DESPEGAR INVESTOR DAY
Leisure and online (asset light)
Brand, product and captive consumers
Sourcing capabilities
GEOGRAPHIC FOOTPRINT
Clear M&A Strategy Focused on Targets That Add to Despegar’s Core Competencies
WHY M&A AND WHY NOW?
Ample room to consolidate fragmented LatAm market
Strong synergy potential
Acknowledgement of revised valuation levels
Most online / leisure companies under pressure
LatAm only Br & Mx as priority, but opportunity drives decisions
Maximizing Despegar sourcing and delivery
Ability to capture operating leverage - scale, operating efficiency
ACQUISITION CRITERIA
DESPEGAR INVESTOR DAY
UNIQUE CORE COMPETENCES
TURNAROUND OPPORTUNITIES
70
DESPEGAR INVESTOR DAY
Case Study: Viajes Falabella
RATIONALE
GEOGRAPHIC FOOTPRINT
UNIQUE CORE COMPETENCES
TURNAROUND OPPORTUNITIES
60% packages penetration
High average ticket price
50% of sales originating with CMR/Falabella customers
Asset-light store platform
Strong brand awareness
Alliance with CMR credit card
+60% volume in Chile, reaching over 20% of market share
Sourcing upside
Apply Despegar’s efficient operating model to high-cost operating models
G&A and T&C Opportunities
(60%)
PRE ACQUISITION
2-YEAR PLAN
REVENUE MARGIN (as % GB)
EBITDA MARGIN (as % GB)
+200 bps
3x
SYNERGIES PLAN
FULFILLMENT COST PER ORDER
(70%)
TOP LINE GROWTH Accelerated leveraging CMR program and D! platform
71
OPPORTUNITY AND STRATEGY IN PLACE TO DELIVER
ECONOMIC UPSIDE
72
DESPEGAR INVESTOR DAY
Despegar Is Weathering a Particularly Challenging Macro Cycle, with Positive LT Indicators
201720162015 2018 2019 LTM
+2.7
- 3.5
+0.3
+1.4
2.3%
- 2.1
- 3.3
+2.3
-0.5
+1.1
+2.0+1.6
+1.1
- 2.5
- 3.5
+0.9+0.3
+2.7
+2.0
+2.6
+0.0
ARGENTINA
BRASIL
MEXICO
LATAM
LATAM LAST 20 YEARS AVERAGE
GDP REAL GROWTH RATE Y/Y, %
ARGENTINA
BRASIL
MEXICO
LATAM
2.1%
2.3%
2.1%
RECENT REAL GROWTH BELOW LT AVERAGES
73
9%
WITH CURRENCIES DEVALUED VS. HISTORICAL AVERAGES
REAL DEVALUATION INDEX 1
20192015 2016 2017 2018
(1) Moving average considering data since 1997
5%
17%
11%
DESPEGAR INVESTOR DAY
Past and Recent Industry Outperformance Signaling Positive Trajectory for Mid-cycle Performance
MID-TO-LT GROWTH DRIVERS
Economic activity
Potential for FX appreciation
FIXED 2017 PRICES
TRANSACTIONS IN MN
MID-CYCLE MACRO
2016 2017 2018 LTM2015
CAGR 25.1%
FXIMPACT
GB LOCAL CURRENCY GROWTH, % Y/Y
-3.2 % +6.1% +4.4% +5.2%+9.0 %
PAX INDUSTRY GROWTH Y/Y
+39.1
GB USD IN BN ASP USD
+7.6
+38.4
GB, TRANSACTIONS & ASP EVOLUTION
+29.2
+21.5
CONTINUED MARKET SHARE GAINS
ASP GAINS FROM RICHER PRODUCT MIX AND COMPLETE TRIPS
74
2016 2017 2018 LTM2015
14
12
10
8
6
4
2
0
495
485
475
465
455
445
435
425
415
492
452
467
454
444
3.3
4.5 4.73.6
4.7
10.510.4
9.17.2
7.7
DESPEGAR AIR MARKET SHARE
2015/2019 + 3pp
499
DESPEGAR INVESTOR DAY
Take Rate Affected, Given Efforts to Maintain Growth and Gain Market Share Through Lower Client Revenue Contribution
MID-TO-LT GROWTH DRIVERS
Higher volumes to drive higher incentives
Lower pricing sensitivity + disposable income
MACRO
Preferred partner program
Bundles - Higher margin product mix
KEY INITIATIVES
75
2016 2017 2018 LTM2015
TAKE RATE EVOLUTION BREAKDOWN, %GB
11.0%11.3%11.8%
12.6%11.7%
62%
38%
63%
37%37%
65%
35%
72%
28%
73%
27%
PARTNER REVENUE %
CLIENT REVENUE %
11.24% at Partner Revenue constant product mix
DESPEGAR INVESTOR DAY
Cost of Revenue Increasing Due to Higher Financing Costs, Partially Offset Through Efficiency Gains
MID-TO-LT GROWTH DRIVERS
Lower financing costs
Merchant mix Impact
CYCLE-DRIVEN
COST OF REVENUE EVOLUTION BREAKDOWN, % GB AND USD PER TRANSACTION
4.3%
COI & CCP, %
FULFILMENT & F&E, %
Operating leverage
Efficiency improvements
Opportunities in fraud and errors
SCALE AND OPERATIONAL EXCELLENCE
COI & CCP PER TRX, $
3.9% 3.2% 3.6% 3.8%
$12.5
$7.5
$11.4
$6.2$8.5$7.2
$9.9
$6.7
FULFILMENT & F&E PER TRX, $
$10.3
$6.7 1
ARG Rates Adjusted COI & CCP ($/transaction)2018: 8.72019: 8.3
76
37.6%
62.4%
35.2%
64.8% 37%
54.3%
45.7%
59.8%
40.2%
60.5%
39.5%
2016 2017 2018 LTM2015
(1) Excluding Viajes Flabella 6.6 $/Transaction
DESPEGAR INVESTOR DAY
Our Brand Strength, Supports Lower Acquisition Costs in a Competitive Market
MID-TO-LT GROWTH DRIVERS
Strong brand awareness in LatAm
Marketing investment optimization -- lower acquisition cost
Diversify traffic sources
Loyalty
Personalization
MARKETING INVESTMENT EVOLUTION
71 67
7974
4.7%
100
64 EXCL. RE-BRANDING
3.7%
SALES & MARKETING, % OF GB
2016 2017 2018 LTM2015
MARKETING DIRECT INDEX, $ PER TRANSACTION
3.7% 3.7% 3.7% 3.4% S&M ex-Rebranding and VF
77
DESPEGAR INVESTOR DAY
Support Areas Costs Showing Improving Trends, with Significant Operating Leverage to Capture Additional ValueTECHNOLOGY & CONTENT and G&A EVOLUTION, IN USD MM
1.7%
G&A, % GB
T&C, % GB
2016 2017 2018 LTM2015
COST PER TRANSACTION, $
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0 1.9% 1.6% 1.5% 1.5%
2.2% 2.0%1.6% 1.4% 1.8%
3.8% 3.9%
3.2%2.9%
3.3%
$13.3$14.8$15.9
$17.7$17.9
MID-TO-LT GROWTH DRIVERS
G&A centralization and automation
T&C development phase
MAIN INITIATIVES BEING IMPLEMENTED
HIGH OPERATING LEVERAGE LEVELS
VIAJES FALABELLA SYNERGY OPPORTUNITIES
$13.1
(1) Viajes Falabella 78
3.0% Ex-VF, SBC and Service Taxes
EXCL. VF 1, SBC and Service Taxes
DESPEGAR INVESTOR DAY
Despegar Continues Investing to Further Strengthen its Competitive Moats and Deliver Higher Returns As the Cycle Turns
INVESTING IN A CHALLENGING CONTEXT
Attractive industry dynamics -
sizable, growing and fragmented
Strong investment in place
Trough point of economic cycle
79
#1 regional brand, consistently gaining market share
DESPEGAR POSITION AND STRENGTH
Strong FX adjusted and operating metrics
Superior business model - strong top and bottom line competitive advantages
Tangible upside from initiatives under development and operating model
5-YEAR PERSPECTIVE
Local Currency GB Growth of approximately 20%
Take rate 11.5%+
EBITDA margin 20%+Strong Cash Flow Generation
Despegar is positioned to deliver strong shareholder returns
Despegar is a unique opportunity in the travel market
Q&A
DECEMBER 2019 NEW YORK CITY INVESTOR DAY
80
CLOSING REMARKS
1
2
3
4
81
Leading OTA in LatAm, a large market with unique preferences that require rapid adaption across geographies
Strong brand with a scalable and flexible business model to drive growth and ensure consumer loyalty, which positions us as the Partner of Choice
Delivering growth even as we currently navigate an adverse macro environment
Investing in multiple strategic initiatives for value creation and broadening our value proposition