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SEC Filings

20-F
TRIVAGO N.V. filed this Form 20-F on 03/06/2018
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spend across all regions. Advertising spend was at elevated levels in the first half of 2017 as we reinvested additional Referral Revenue from the introduction of the relevance assessment into our marketing activities. As most of our advertisers changed their landing pages in response to the introduction of the relevance assessment at the end of the second quarter of 2017, we reduced our advertising spend in the second half of 2017 to account for the reduction in our commercialization; however we were initially unable to pull back planned TV advertising spend quickly enough to respond to the speed of the RPQR slowdown in the second half of 2017, reflecting our inability to reduce planned TV advertising spend due to commitments in some markets. Selling and marketing expenses for the year ended December 31, 2016 increased by €211.9 million, or 45.9%, compared to the year ended December 31, 2015, primarily driven by an increase in marketing activities across all markets.
Other selling and marketing expenses for the year ended December 31, 2017 increased by €19.9 million, or 51.3%, compared to the year ended December 31, 2016 primarily by increases in production costs for TV advertisements, notably in Rest of World and Developed Europe, higher personnel costs and increased spending on marketing material. We also increased our headcount from 521 employees as of December 31, 2016 to 606 employees as of December 31, 2017, mainly related to employees hired for hotel sales teams to increase the acquisition of new hotels on our marketplace and expand our hotel services sales. This led to an increase in personnel-related expense of €6.1 million for the year ended December 31, 2017. Other selling and marketing expenses for the year ended December 31, 2016 increased by €13.1 million, or 51.0%, compared to the year ended December 31, 2015 due to higher personnel-related expenses primarily driven by an increase in headcount from 433 employees as of December 31, 2015 to 521 employees as of December 31, 2016.
Share-based compensation decreased by €7.4 million, or 67.9%, in the year ended December 31, 2017 compared to the year ended December 31, 2016, which was primarily driven by fluctuations in the fair value accounting treatment of awards which were classified as liability awards in the prior periods. Share-based compensation increased by €7.5 million, or 220.6%, in the year ended December 31, 2016 compared to the year ended December 31, 2015, which was primarily driven by fluctuations in the fair value accounting treatment of liability classified awards granted in prior periods.
Technology and content
Technology and content expense generally consists of expenses for technology development, product development and content personnel and overhead, depreciation and amortization of technology assets including hardware, purchased and internally developed software and other professional fees (primarily licensing and maintenance expense), including share-based compensation expense.
 
Year Ended December 31,
 
% Change
(in millions)
2015
 
 
2016
 
 
2017
 
 
2016 vs 2015

 
2017 vs 2016

Personnel
 
17.0

 
 
24.0

 
 
34.0

 
41.2
%
 
41.7
 %
Share-based compensation, net of capitalized internal use software and website development costs
 
4.5

 
 
15.8

 
 
3.6

 
251.1
%
 
(77.2
)%
Depreciation of technology assets
 
1.4

 
 
3.9

 
 
4.0

 
178.6
%
 
2.6
 %
Professional fees and other
 
5.8

 
 
8.0

 
 
10.6

 
37.9
%
 
32.5
 %
Total technology and content
 
28.7

 
 
51.7

 
 
52.2

 
80.1
%
 
1.0
 %
% of total revenue
 
5.8
%
 
 
6.9
%
 
 
5.0
%
 
 
 
 
Technology and content expense for the year ended December 31, 2017 increased by €0.5 million, or 1.0%, compared to the year ended December 31, 2016. The increase was primarily driven by increases in personnel-related costs as we grew our headcount and made investments in content expansion, which was largely offset by lower share-based compensation expense. The increase in personnel-related costs amounted to €10.0 million, or 41.7%, as we continue to make investments in product content and therefore increased our headcount from 499 employees as of December 31, 2016 to 652 employees as of December 31, 2017. This increase in personnel-related costs was largely offset by lower share-based

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