New York Times article on Priceline

[bturner13]

It has been reported,

"The number of Priceline airline tickets sold dropped sharply

[thereuare]

This news (or similar news) has been floating around for a few days now.

I think Priceline also announced the other day that hotels bookings year-to-date are up something like +35%... but this news doesn't seem to generate as much press (we're in a slow economy, so only negative news makes the headlines).

I think the public still thinks of Priceline as a company for airline tickets, while the rest of us know that the true gem of a product is their hotel business. I think there were horror stories when Priceline first came out, mostly related to their airfare business, and they are still paying the price for it.

People don't know just how GREAT the hotel side of things are... especially when you take the time to educate yourself, learn the process, and consult prior winning bids and results. I too was hesitant the first few times, but getting hotel rooms at 1/3 to 1/2 the cost of traditional means is worth any potential risk that still remains for me. There have been hotels that i have stayed at that were "ok", but i raved about them given the price i paid. Send me to something that's "acceptable", charge me $50, and i'll think it's the greatest bargain around. Send me to that same hotel, charge me rack rate of $150+, and i'll be cursing the whole way home.

[bturner13]

As a footnote to the NY Times article on PL. PL's car bidding will now be done thru their LowestFare.Com website. I do agree with ThereUAre that PL's hotel bidding is their true gem and the greates bargain around!

[thereuare]

I do agree with ThereUAre

Your wife DID train you well :)

[zbenye]

Priceline would see much more airline booking business, I suspect, if only they allowed one to select an acceptable timeframe, such as morning, afternoon or evening. Otherwise, that product is only good for long trips, when losing a day at the front (late departure) and/or the end (early return) is not a big deal. For a weekend, PL is not a realistic option. Most of my flights are for weekend getaways. The only time I considered using PL (and eventually did) was on a 9-day trip.

As for the hotel business, that's indeed the real business. But it will immediately go belly up when Hotwire manage to lower their rates to match PL's, and advertize that fact effectively. When there's no difference in price, it makes much more sense to use Hotwire, where you can see some clues about what you're getting (amenity icons).

[bturner13]

The following is the latest response from Priceline that clarifies the issue. Car bidding in the news report IS selling new cars and NOT Rental Car bidding!

"Dear Sir,

Thank you for taking the time to send us an e-mail. We understand you

are inquiring if priceline.com sells new cars on its website.

Mr. Turner, Priceline has discontinued the selling of new automobiles so

that we can focus our resources on Airline Tickets, Hotel Rooms, Rental

Cars and Vacations.

If you have any further questions, please reply to this message and your

email will go directly to an agent.

We look forward to serving your future travel needs.

Sincerely,

Janak J.

The priceline.com Customer Service Team"

Zbenye is on the mark about clues with Hotwire. When will PL wake up?!?

[thereuare]

As for the hotel business, that's indeed the real business. But it will immediately go belly up when Hotwire manage to lower their rates to match PL's, and advertize that fact effectively. When there's no difference in price, it makes much more sense to use Hotwire, where you can see some clues about what you're getting (amenity icons).

But what if the opposite happens, and Priceline decides that they now want to make $10 profit per room above their cost (in addition to the $5.95 fee). As Hotwire is privately owned, we have no idea how much business they do or if they're profitable or not. Judging by the posts here, it appears that Hotwire does significantly less business than Priceline; i agree that some sort of shakeout will occur in the future, but i'm not sure if it means higher prices at Priceline or lower prices at Hotwire. Looking towards an uncertain future is why i felt it was important to maintain a database on BOTH services, as well as welcome other deals from other companies... it's all about getting the best deal!

I also agree that Hotwire's process is more user friendly as a result of the icons and should generate more business for them in that sense, but they need to be more compeitive on price. Most people are smart enough to consider "total price" and to pay a few dollars more to be guaranteed an amenity like a shuttle bus when in an airport zone instead of having to pay for a taxi would be worth it. But now, the difference in price is often $20 or more, and the additional cost is not worth the "guarantee." I do think that Hotwire is still the better choice for some families in certain situations, even with their higher price. The clearest example is a family with children who want to swim while at the hotel; Hotwire is the only way to know ahead of time if there is a pool on the premises or not, and THAT would be worth an extra $20 if a pool was important to me.

My first thought on airfare is that i'd sooner use it if i could select non-stop and still have the times be unkown (anytime of day). I wonder which would make their business more worthwhile... allowing users to pick a time of day with at least one connection OR having times be totally unkown and allowing a selection of non-stop. Unfortunately, i don't think either of these scenarios will be seen anytime in the near future, as it just doesn't "fit" with their business model (airlines wouldn't want to participate out of fear of canibalizing their existing business).

Interesting thoughts all around.

[zbenye]

Regarding amenity icons, I would actually prefer to have check boxes where I could require certain amenities when placing a bid, most important of which would be free parking. This would be sort of like the check boxes on airline bids where you can limit the number of connections, red eyes, etc.

thereuare, requiring non-stops will not help weekend-getaway travelers. You're right that allowing a more restrictive time of day selection doesn't fit the current model, but we can all see that the current model isn't generating a lot of business... Must adjust to sell. And do you think the airlines care about opacity to such a high degree? I'm thinking, got lots of empty seats - release inventory to PL; seats selling out traditionally - withhold from PL. Business travelers who really need to be somewhere at a certain time don't use PL. Others have no brand loyalty and would go with the cheapest airline anyway.

PL-Hotwire prices: it doesn't make a difference if Hotwire reduces prices to match PL, or PL ups theirs to match Hotwire. The point is that when they're significantly similar, Hotwire has the advantage of having a better product. And if PL signficantly upped rates (like $10 in your example), then often they'd be beat even by Expedia...

Just my uneducated opinion.