Expedia, Inc. | 2013 | FY | 3


Advertising Expense

We incur advertising expense consisting of offline costs, including television and radio advertising, and online advertising expense to promote our brands. We expense the production costs associated with advertisements in the period in which the advertisement first takes place. We expense the costs of communicating the advertisement (e.g., television airtime) as incurred each time the advertisement is shown. For the years ended December 31, 2013, 2012 and 2011, our advertising expense was $1.2 billion, $890 million, and $797 million. As of December 31, 2013 and 2012, we had $16 million and $9 million of prepaid marketing expenses included in prepaid expenses and other current assets.