Priceline Profit?

[BWDC]

How does Priceline make money off the name your own price service?

Is it based solely on the fees they charge you with your bid, or do they also get a some percentage back from the hotel for winning bids?

Thanks

[robb01]

Both ways I would imagine, they wouldnt do it if there wasnt profit

[klmklm]

Generally, they have prices negotiated with the hotel which you can't see, So when u name your own offer, priceline checks to see if there is a hotel lower than your price for them to make money.

[BWDC]

So lets say the Hyatt is offering rooms to Priceline for $70. Priceline then accepts an $80 bid for a room at the Hyatt. The extra $10 a night goes to Priceline not to the Hyatt?

[powerplantop]

How does Priceline make money off the name your own price service?

Is it based solely on the fees they charge you with your bid, or do they also get a some percentage back from the hotel for winning bids?

Thanks

Two ways.

1: The booking fees.

2: The diference between what the hotel charges them and what you bid.

Example Hotel Shows PL a rate of $49 you bid $100. They charge you a $5 booking fee. PL made $56.

If you would have bid $49 and PL takes it they only make $5 but the hotel still gets paid the same.

[dahammer]

somebody has to pay for Bill Shatner's toupee's :)

PRICELINE recommends that hotels "load" multiple price points into the system so as to maximize hotel revenue. Occasionally I will view my folio using the remote controls on the TV in the room. There will be a "credit" on my account that is much less than my total bid including tax and fees; this credit goes towards room and tax. PRICELINE keeps the difference between what it remits to the hotel and your total price; the margin can be 20% or more.

[powerplantop]

A few times when I would sign in I would see the PL rate on the sheet. But it has been awile since I have seen that.

Had not thought about checking the folio on the TV.

[BWDC]

Thank you all for the responses, much appreciated.

Now, I know this is the Priceline section but what about Hotwire?

Their process is a bit different than Priceline's so there isn't a chance of people overpaying and teh extra dough going to Hotwire since they have set offers. Are they getting anything back from the hotels for selling these unused rooms, or is it just the fees that make them money?

[thereuare]

HOTWIRE is given rates by the hotel and adds a mark-up to the price, this mark-up, and their booking fee, becomes their profit. (less their expenses of course)

What exactly is it that you're trying to figure out?

[BWDC]

Thanks, thereuare.

I work for a consumer magazine and we're doing an article on hotel prices in an upcoming issue. Just trying to learn from the ground up.

[thereuare]

I work for a consumer magazine and we're doing an article on hotel prices in an upcoming issue.

It's considered good netiquette if you announce you intentions from the start :)

[Slatman]

Priceline makes the most money with the folks that accept counteroffers. Even people I have trained in rebidding always

call and ask should I take the offer?

Hotels enter NET rates into various opaque websites (rates not visible to the public) The hotel chain may have one rate code that goes to a few or many opaque sites. The hotel can also set minimum stay limits, close out days for arrival, and maximum number of rooms to sell at the net rate.

Hotels use opaque websites to fill empty rooms at lower rates without compromising current business, groups, and prearranged corporate rates. You can benefit most from priceline since the rate the hotel enters is the rate you pay (plus service fees and difference between the hotel rate and priceline bid)

Other websites (Orbitz, Travelocity etc) charge hotels up to 25% of the rate in fees and hotels are required to have rate parity (the same rate on all sites)

[krennen]

How much are the fees that PRICELINE charges for Name your own Price for hotel rooms?

[dahammer]

How much are the fees that priceline charges for Name your own Price for hotel rooms?

just make a bid, on the second page and befoe you click "buy my hotel room now", you will see a line item for taxes and fees. You can typically save 50% or more compared to convrentional bookings, so the fee will be minor compared to your expected savings.

[dahammer]

A few times when I would sign in I would see the PL rate on the sheet. But it has been awile since I have seen that.

Had not thought about checking the folio on the TV.

I just did this last night, my folio "credit" was $48.13 on a $44 Bid. So when the hotel's night auditor posts room and tax to my room, this will create a zero balance. My bid including taxes was $55.81, so it looks like PRICELINE made a 16% profit of $7.68.