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Priceline.com

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Priceline.com
Company typePublic
Nasdaq: PCLN
S&P 500 Component
Founded1997 [1] (online 1998)
Headquarters
800 Connecticut Avenue, Norwalk, Connecticut
Number of employees
3,400 (2011)[2]
Websitewww.priceline.com

Priceline.com is an American company and a commercial website that helps users obtain discount rates for travel-related purchases such as airline tickets and hotel stays. The company is not a direct supplier of these services; instead it facilitates the provision of travel services by its suppliers to its customers. It is headquartered in Norwalk, Connecticut, United States.

Priceline was the brainchild of digital entrepreneur Jay S. Walker. The company's origins were closely tied with Walker's company Walker Digital. Hong Kong company Cheung Kong Holdings later purchased a significant portion of Priceline's stock.[3]

History

Priceline first gained prominence for its Name Your Own Price system, where travelers would name their price for airline tickets, hotel rooms, car rentals and vacation packages. While the purchaser can select a general location, service level and price, the hotel, rental car company or airline (as well as the exact location of the hotel and the exact flight itinerary) is disclosed only after the purchase had gone through, with no rights to cancel.

Priceline's cut of the proceeds was the difference between the price an individual named and the price charged by the service establishment. More recently, it has added a more traditional model where travelers are presented prices and are also told the name of the establishment. Travelers can still choose to name their price for airline tickets, hotel rooms and rental cars. The number of airlines, hotels and car rental company participants in the name your own price program has increased as these suppliers utilize this opaque market Priceline created to sell their perishable inventory without lowering prices through other traditional sales channels. Priceline now also sells discounted cruises, as well as tours and attractions.

Priceline.com also experimented with selling gasoline and groceries under the Name Your Own Price model in 2000, at the height of the dot-com bubble, through a partially owned affiliate, WebHouse Club. Priceline also got into the online auction business with Priceline Yard Sales, where individuals would use the Priceline system to haggle for various second-hand items and trade them in person. Priceline also sold long distance telephone service and automobiles under the Name Your Own Price model. All of these experiments were terminated in 2002. Another experiment, the Name Your Own Rate system for home loans, continues under a license with EverBank. In 2002 Priceline licensed its “Name Your Own Price” travel system to eBay.

Priceline returned to its original focus on travel products, such airfares and rental cars, with the addition of cruise sales and a special emphasis on hotel bookings in its commercials. During November 2007 Priceline “permanently” eliminated all booking fees on published airfares.

Spokespeople

William Shatner

For years, Priceline's official spokesperson has been William Shatner, who agreed to do the spots for free in exchange for stock in the company.[4] The arrangement turned out to be quite profitable for Shatner, who sold much of the stock shortly before its value plummeted in the dot-com bust and has since made approximately $600 million from Priceline.com. (This reported sum has been met with some skepticism from the financial press.[5]) An early ad campaign featuring Shatner had him belt out popular songs in spoken word, in the style of his album, The Transformed Man. He was "replaced" in 2004 by his Star Trek co-star, Leonard Nimoy. Shatner still appeared in spots for Priceline, running into Nimoy as his replacement. When that campaign ended, Shatner again became Priceline's sole spokesperson. In 2007, a new ad campaign by Butler, Shine, Stern & Partners had Shatner take on the role of Priceline's Negotiator. In commercials that began airing January 22, 2012, Shatner's Negotiator character apparently dies as a bus falls off a bridge and explodes.[6] Subsequent ads have featured his "spirit," still advertising Priceline.com from beyond the grave.

Priceline has been parodied on the Tonight Show by Jay Leno and in multiple Saturday Night Live skits. In a September 2008 SNL skit, during the opening monologue by Olympian Michael Phelps, Shatner rose from the audience to give Phelps tips on product endorsements.[citation needed]

Theresa Caputo (Long Island Medium)

In June 2012, Theresa Caputo, star of the television show Long Island Medium, appeared in a commercial for Priceline.com, in which she portrayed herself "connecting" with the late Priceline Negotiator character previously played by William Shatner.[7] However, this commercial has sparked controversy, since the commercial appears to make light of the Native American belief of smudging.[8]

JREF President DJ Grothe released a press release calling out Priceline.com for endorsing Caputo, stating, "It is difficult to watch the show and not feel heartbroken for those who are desperate to hear from the departed... and even more so if they are being manipulated by a charlatan." Grothe urges Priceline.com to "invite... your new representative" to take the James Randi Million Dollar challenge and prove her credentials.[9]

Acquisitions

Agoda.com

In November 2007 Priceline acquired Bangkok-based Agoda,[10] an online hotel reservations service which provides a service similar to Priceline's but specializing in Asia Pacific. Agoda's network includes 27,000 hotels in Asia and more than 168,000 worldwide.[11]

Booking.com

Priceline is the parent company of the European organization Booking.com. Established in 1996, Booking.com is the world's leading online hotel reservations agency by room nights sold, attracting over 30 million unique visitors each month via the Internet from both leisure and business markets worldwide[12]. Booking.com offers many types of property, ranging from small independent hotels to a five star luxury through Booking.com. The Booking.com website is available in 41 languages and offers over 230,000 hotels in 167 countries.

Booking.com is based in Amsterdam (Netherlands) and is supported internationally from offices in Amsterdam, Antalya, Athens, Auckland, Bangkok, Barcelona, Beijing, Berlin, Bolzano, Brussels, Buenos Aires, Cambridge, Cape Town, Casablanca, Chicago, Copenhagen, Dubai, Dublin, Edinburgh, Grand Rapids, Helsinki, Hong Kong, Honolulu, Houston, Innsbruck, Istanbul, Kiev, Kuala Lumpur, Kuta (Bali), Las Palmas de Gran Canaria, Las Vegas, Lisbon, London, Loulé (PT), Lyon, Madrid, Málaga, Mexico City, Miami, Milano, Montréal, Moscow, Mumbai, Munich, Natal, New York, Nice, Norwalk, Orlando, Osaka, Oslo, Paris, Phuket, Prague, Riga, Rome, San Francisco, São Paulo, Seoul, Shanghai, Singapore, Sofia, Stockholm, Sydney, Thessaloníki, Tokyo, Toronto, Tourcoing, Vancouver, Venice, Vienna, Warsaw, Zagreb and Zürich.

As of September 26, 2011 Darren R. Huston has been named Chief Executive Officer of Booking.com.

TravelJigsaw

Priceline picked up another piece of the puzzle — TravelJigsaw — in its international expansion strategy. Under the new financing deal Traveljigsaw will be provided with sufficient capital to enable working growth in order that ISIS may release some of its substantial investment in the travel specialist.

TravelJigsaw has reported an "extremely successful" sixth year of trading with turnover increasing by 32 per cent. TravelJigsaw posted a turnover of £157.1m in the 12 months to 31 December 2010, up from £119m a year earlier. Gross profit increased from £27.3m to £38m for the same reporting periods. The company currently employs in excess of 400 staff and latest accounts show an annual turnover of over £250 million.

Gregory Wills, TravelJigsaw’s managing director, says the company will work closely with Booking.com and Agoda to build distribution. Key questions looming will be the interplay between TravelJigsaw, Booking.com, Agoda and Priceline.com, as well as what kind of response, if any, Expedia has to Priceline’s car-rental acquisition. So, one can imagine a lot of cross-promotion between Booking.com, Agoda and TravelJigsaw in various markets, if not some integration in the future.

Active Hotels

In November 2006, Active Hotels Limited merged some operations with Booking.com. The company’s physical locations and personnel are not affected by the name change and its websites will continue to be marketed with differentiated products targeting their loyal and growing customer groups.

Priceline branding

Priceline, Booking.com, Active Hotels and Agoda are separately branded for dissimilar demographics. However each company is regulated and integrated into the Priceline business model. Priceline is also the most talked about travel booking site online in the Brand Passion Index.[13]

Footnotes

  1. ^ [<http://www.hoovers.com/company/pricelinecom_Incorporated/hxxcki-1.html "Priceline.com Incorporated"]. Hoovers. Retrieved December 16, 2011. {{cite web}}: Check |url= value (help)
  2. ^ "Investor FAQ". Retrieved 2011-08-13.
  3. ^ "Ownership". MSN Money. Retrieved 2006-12-20.
  4. ^ Carlson, Nicholas (May 4, 2010). "William Shatner Has Made $600 Million Shilling Priceline.com". businessinsider.com.
  5. ^ "William Shatner Lives Long and Prospers -- but Did He Really Make $600 Million?". Retrieved 2011-03-26.
  6. ^ Elber, Lynn (2012-01-19). "Goodbye to William Shatner — again". News & Record. Associated Press. Retrieved 2012-01-19.
  7. ^ "TV's Long Island Medium Theresa Caputo Channels The Dearly Departed Negotiator In New Priceline.com TV Spot". Finance.yahoo.com. 2012-06-25. Retrieved 2012-08-13.
  8. ^ {{cite web|url=http://www.change.org/petitions/priceline-remove-the-long-island-medium-smudging-commercial-from-the-air-2 |title=Petition | Priceline: Remove the Long Island Medium smudging commercial from the air.
  9. ^ Grothe, DJ. "Priceline.com: Will You Prove Your Spokesperson Worthy for a Million Dollars?". The Huffington Post. Retrieved 8/15/2012. {{cite web}}: Check date values in: |accessdate= (help)
  10. ^ "Priceline.com Acquires Asian Online Hotel Reservation Service Agoda Company".
  11. ^ "What is Agoda?". Retrieved 2008-05-07.
  12. ^ http://www.booking.com/general.en-gb.html?aid=304142;sid=40c1b96964146b44837e76f186d55b85;dcid=2;tmpl=docs/about
  13. ^ NetBase Brand Passion Index for Travel Booking sites, March 30, 2011
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