Loading...

DON"T bid higher for a specific hotel


thereuare
By thereuare,
in

Recommended Posts

If there are two hotels in an area, one that typically sells for $40 and one that sells for $50, DO NOT bid $50 in hopes of getting the higher priced hotel.

You are just as likely to get the lower priced hotel and have paid $10 too much.

Please use this HOTWIRE and these PRICELINE LINKS: HOTELS, CAR RENTALS, and AIRFARE to begin your travel purchases

Want to know if Rates Drop?? Get alerts at RateDrop.com

Link to comment
  • 4 weeks later...
  • Replies 67
  • Created
  • Last Reply

Top Posters In This Topic

In general that's right, but let me ask a question with one counterexample.

In the Midtown East zone of New York City, a 4* $75 bid generally yields the Grand Hyatt.

Bidding $20 more generally yields one of the other possibilities (e.g. Waldorf Astoria, W).

I've never seen the other hotels come up with a $75 bid.

So while it's possible that PL could stick you with the Grand Hyatt @ $95, I don't think PL could give you the W for $75.

I guess my point is that while bidding higher doesn't guarantee you a better room, it's still sometimes worth the risk on the chance of getting the better property -- especially if you'd really value a hotel other than the Grand Hyatt. Thoughts?

Link to comment

Glef,

You're correct in your assessment in that only bidding $75 doesn't make you 'eligible' for the other hotels in the area (based upon prior winning accepted bid amounts). However, using your example, simply bidding $95 could easily result in a $20 overbid, with you still receiving the Grand Hyatt.

I would handle the above situation by bidding $75 first, and then if rejected, raise my bid to $95 when using a re-bid zone. This way if $75 is rejected, i know there is no availability at that rate and by then bidding $95 it won't result in an over-bid (at least not by as much). If the Hyatt is indeed available, i'd get it with my first bid and not risk 'wasting' $20 with a higher bid.

I know you're familiar with re-bidding, but i'll add this link for anyone else that may be reading: Re-bidding for Priceline hotels

Please use this HOTWIRE and these PRICELINE LINKS: HOTELS, CAR RENTALS, and AIRFARE to begin your travel purchases

Want to know if Rates Drop?? Get alerts at RateDrop.com

Link to comment

So in this special case, it comes down to whether you're willing to gamble the $20 and whether you're willing to settle for the lesser property.

In the example above, if you absolutely don't want the Grand Hyatt, don't bid the zone. (Including don't bid 3* at a price that the hotel will accept -- in this case, ~ $75 -- because Priceline could even upgrade you.)

If you don't really want the Hyatt but would accept it, it may be worth a $20 overbid on the chance of the better property.

But you're absolutely right that a reject $75 and then a $95 bid is the best possible world.

Thanks! :)

Link to comment
  • 10 months later...

Does anyone have any idea of exactly how PL matches up bids with hotels?

This is my theory - can anyone confirm or deny? I imagine that hotels have certain ranges in which they can be picked. Lets say for example, for a particular class in a particular zone, there are two hotels, Hotel 1 and Hotel 2.

Hotel 1 has a range of $60-70

Hotel 2 has a range of $70-80

Assuming both are available, if you bid within that range, you will get the hotel in the range you bid. But if and only if Hotel 2 is unavailable, and you bid $71, then you will get Hotel 1.

My reasoning is that PL knows that it will be harder to sell the higher price hotel (for the simple reason that it is more expensive), and therefore PL would prefer to sell the harder-to-sell hotel.

Does this sound correct?

An additional problem is when ranges overlap - which hotel will be selected? Again, using the above reasoning, I think the higher price one will sell.

Against the advice in this thread, I'm trying to bid a higher price to get a higher quality hotel in the same star range, so I'm trying to gather as much info as I possibly can.

Link to comment

Here's a laymens version of the way I've been led to believe it works....

Hotel A has the following Priceline rates: $55 $62 $71 $85 $100

Hotel B has the following Priceline rates: $60 $65 $74 $89 $105

Bid #1: If you bid $55-59, you will be assigned Hotel A.

Bid #2: If you bid $60 you will be assigned Hotel B. You will not be assigned Hotel A at $55 with Priceline making an extra $5 on the transaction.

Bid #3: If you bid $73, Priceline will assign you and pay Hotel A $71. Priceline's profit will be the $2 you "overbid" ($73 vs $71) plus their service fee.

It is my understanding that Priceline's contract with it's vendors is to assign whichever hotel has the Priceline rate closest to the amount you bid. This prevents Priceline from making an extra $45, for example, if you bid $100 and Priceline buys the room from Hotel A for $55. This protects the hotels by ensuring that if you bid high, they get the higher revenue, not Priceline. Priceline makes their money off the service charge and any amount you bid over the closest qualifying rate up to the next higher qualifying rate.

FOFT, if this theory is correct (which I tend to believe it is) I would caution you against bidding higher to get a specific, or better quality hotel. Unless you are either willing to accept the consequences -or- you have knowledge of the better hotel's Priceline rates and can somehow "target" such rates. Let us know how it goes if you decide to gamble with a higher bid!

Link to comment

I know that it's been explained as above before, but if that's the case, why wouldn't a hotel enter multiple rates into the system. For example, if their lowest accepted rate is $50, why not also enter $51, $52, $53, $54, etc, etc so that they always get the higher bid and give less to Priceline.

I do believe hotels have multiple rates based upon peak/off-peak and high/lo occupancy, but only have one rate into the system at a time.

I may see somebody i know in this weekend that is in the hotel business and if i do i'll ask them how it works.

Please use this HOTWIRE and these PRICELINE LINKS: HOTELS, CAR RENTALS, and AIRFARE to begin your travel purchases

Want to know if Rates Drop?? Get alerts at RateDrop.com

Link to comment

Good point, thereuare. But I wonder if Priceline's contracts prohibit a specific property from having rates just $1 apart. Wouldn't that create an unfair monolopy in favor of that hotel brand? And I tend to believe hotels have multiple rates for a given date so as to evenly distribute hotel brand assignment given the vast dollar range people bid.

An acqaintance of mine had the following results. He does not frequent these boards, and had no idea what to bid. He wanted to stay two nights in San Francisco, however made two separate bids in an effort to "hotel hop" and possibly be assigned two different hotels.

Bid #1 of $110 for the first night landed him the Pan Pacific.

Bid #2 of $100 for the second night landed him the Hilton.

FOFT could say his theory is correct in the above example, assuming we agree the Pan Pacific is better than Hilton. But I claim it follows my theory of Priceline assigning whichever hotel has the closest qualifying rate to the amount bid! And the question remains, did the Hilton have a lower rate than $100 available that particular night? My guess is they did, but $100 was just one of their many qualifying rates.

We may never know the answer, but keep those theories coming!

Link to comment

Remember the days when Priceline separated the hotel tax from their service fee on your award confirmation? When people posted this valuable information, we could determine, to the penny, Priceline's purchase rate from the hotel and bid that amount on our own bids.

Using that tried-and-true method, where does the 7% theory from the article come into play?

Link to comment

Interesting discussion (which started from an old post.. always nice to see old posts that still get read and revived).

I agree that hotels get assigned based upon the closest price equal to or lower than the bid, but I don't understand you comment:

hotels have multiple rates for a given date so as to evenly distribute hotel brand assignment given the vast dollar range people bid

Does this mean that hotels can input multiple rates just so that Priceline doesn't get 'too much' of the over-bid?

Please use this HOTWIRE and these PRICELINE LINKS: HOTELS, CAR RENTALS, and AIRFARE to begin your travel purchases

Want to know if Rates Drop?? Get alerts at RateDrop.com

Link to comment

That's been my understanding, anyway.

I believe it serves two purposes:

1. Maximizes the hotel's revenue vs giving too much to Priceline.

2. Assures even brand distribution with multiple properties having multiple Priceline rates for any given date.

Believe me, I'm no expert, but I would think the participating brands would collectively want it this way to ensure equal distribution. I would be willing to bet the night my friend got the SF Hilton for $100, that there were others assigned there as well who placed lower bids. I don't believe Hilton made a bundle on his so-called "overbid" but rather they had multiple Priceline rates on the same date.

Link to comment

I think it's been speculated also that Priceline's TravelWeb partners (which include several major hotel chains) might possibly be favored somehow in the hotel award process. Who knows how that works - possibly they mght be allowed to have more Priceline rates, but I can't say.

thereuare:

Does this mean that hotels can input multiple rates just so that Priceline doesn't get 'too much' of the over-bid?

That's what I understood.

Beav:

Using that tried-and-true method, where does the 7% theory from the article come into play?

That's one reason I can't quite believe the article. It's also possible the algorithm has changed in the past couple years.

Link to comment

Any hotel can load 50+ rates. Most don't load nearly so many, but it would be to their advantage to do so I would think (in order to capture overbids and more Priceline business at higher price points).

Most hotels offer rates in increments of $5, as Priceline informs hotels that most bids are placed in $5 increments. (Also, the median bid across all geographic locations and all quality levels is $50)

Priceline books the highest applicable rate, as illustrated in a post above.

Priceline then makes money in (3) ways

* Booking fee

* Overbid

* Commission on the rate booked

I do not know how Priceline chooses between hotels offering identical rates.

Link to comment
Does this mean that hotels can input multiple rates just so that Priceline doesn't get 'too much' of the over-bid?

Yes, hotels can input a whole lot of rates (more than 50, though few do AFAIK).

One result is that hotels get more of the overbid. But the real driver is just more revenue to a hotel.

Say that there's only one 4* hotel in a zone. That hotel has rates of $55, $65, $75, $95, $125.

If they just had their $55 rate and someone bid $80, the hotel would only get $55. In this example the hotel gets $75. And if someone bid $100, the hotel would get $95... $40 better than if they only loaded their most rock-bottom Priceline rate.

Now, in my examples above Priceline is still getting $5 from an overbid. They also get their booking fee. And they'd be taking a commission out of the rate as well.

Link to comment
Now, in my examples above Priceline is still getting $5 from an overbid. They also get their booking fee. And they'd be taking a commission out of the rate as well.

I didn't know that Priceline also got a commission. But I guess this is why occasionally Priceline seems to sell a room for less than the Priceline rate (judging by what people happen to see on receipts or in the olden days by calculating backwards from taxes)?

Link to comment
  • 2 weeks later...

I would handle the above situation by bidding $75 first, and then if rejected, raise my bid to $95 when using a re-bid zone.  This way if $75 is rejected, i know there is no availability at that rate and by then bidding $95 it won't result in an over-bid  (at least not by as much).  If the Hyatt is indeed available, i'd get it with my first bid and not risk 'wasting' $20 with a higher bid.

Ok, I have read this whole thread 2 or 3 times now, and I think I get it all except this one part. Can someone clear this up for me, because I am thinking of taking a gamble in overbidding in Orlando Resort in hopes of getting the Gaylord Palms instead of the Wyndham. The Wyndham is going for the high $60 range and the Gaylord palms is coming up at $83-88. I do realize it is a gamble. However I don't understand the above quoted concept. In that scenario if the $75.00 gets rejected, why do you go straight up to $95.00. If the property is not available at the $75.00 rate, then how could you overbid on it (if it's not available, it's not available) so why would bidding $80.00 get you an overbid on it? Is the rationale for going straight to $95.00 based on seeing others post a win on that property for that price? I just don't have this worked out and would like to know if anyone can clear up this one point. Thank you for any help. I am new to this board, but understand the priceline concept as well as how to get free rebids.

Link to comment

Cindywuer,

I believe Thereuare thought that the Grand Hyatt only had one rate w/Priceline ($75) when he made that post last year. I'll certainly let him speak for himself, though, to avoid any misunderstanding.

I assume most everyone participating in this thread, however, probably agree that Priceline has multiple rates on a given date at a given hotel based on the more recent posts. If true, a person could in fact have still been assigned the Grand Hyatt at $95 in the example cited.

Hope that clears it up a little for you.

I empathize with your Orlando situation! I would say "go for it" with regards to bidding up, if (and only if) you are willing to accept the consequences, should you wind up at the Wyndham on an $80-90 bid.

I'm wrestling with the same situation in San Francisco. Many hotels in the 4-star category go for $55-70. The Park Hyatt has been going for $85 minimum. I'm very tempted to bid $85 and "test the waters." But, I have to heed the same warning I gave you.....don't be mad if I wind up at the lower-priced Hilton!

Link to comment

Cindywuer,

My comments were not necessarily based on the Hyatt only having one rate, it was based upon a combination of knowing the NYC area and the example given....

At the time of the post, the cheapest 4* NYC rate, when available, was in MTE at $75. After that, MTW and MTE often accepted bids at rates of $88, $93, and $95.

So my thinking was that by bidding $95 right away the user may have gotten the $75 hotel for $95... a $20 overbid. If one would have bid $75 first and was rejected, they would know for certain that the $75 wasn't available. By then bidding $95, at worse it would result in a $7 overbid since $88 was the next lowest 'known' acceptable bid.

At least i think that's what i was thinking :)

If that doesn't clear it up then feel free to ask add'l questions.

Please use this HOTWIRE and these PRICELINE LINKS: HOTELS, CAR RENTALS, and AIRFARE to begin your travel purchases

Want to know if Rates Drop?? Get alerts at RateDrop.com

Link to comment
Priceline is going to sell the room that they can make the most money on.Over bidding is only going to put you into a hotel that you would have gotten for less.Just my take on the matter

I've read several places that Priceline does indeed book at the highest qualifying rate. This is to keep the hotel vendors happy. Here's one URL from December 2002:

http://www.google.ca/search?q=cache:OMn1nu...&hl=en&ie=UTF-8

Link to comment

Interesting... According to this "presentation" hotels DON'T pay a commission on the bookings to Priceline...

Now, if I could figure out a way to crack into the WorldSpan system at work and see the PL rates, I'd be a happy camper!

DeltaPurser :)

Link to comment
Need help with your own trip?

Register now, we have a huge community of travel enthusiasts to answer any questions you might have.

Create an account

Sign up for a new account in our community. It's easy!

Register a new account
Sign in

Already have an account? Sign in here.

Sign In Now
EXCLUSIVELY at BetterBidding:
$10 OFF

HOTWIRE COUPON


(click here) and use

promo code

: HWHOTELDEAL

(Hot Rate Hotels $150+ purchase... expires 12/31/2021)
OR
5% OFF

PRICELINE COUPON


(click here) and use

promo code

: BBDEC21

(Express Hotels or most Pay Now Hotels / 3+ stars / max $50 discount... expires 12/31/2021)
QUICKQUOTE [X]
PRICELINE & HOTWIRE on one screen!
NOTE: Priceline searches for
DOUBLE OCCUPANCY ONLY
Room %roomN%:
Age of child:
FINDFAST[X]
×
×
  • Create New...