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Priceline.com

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Priceline.com
Company typePublic
Nasdaq: PCLN
S&P 500 Component
NASDAQ-100 Component
Founded1997[1] (online 1998)
Headquarters
800 Connecticut Avenue, Norwalk, Connecticut
Key people
Darren Huston, CEO, Priceline Group
Revenue
  • Increase US$ 6.79 billion (2013) [2]
  • Increase US$ 5.26 billion (2012) [2]
  • Increase US$ 2.41 billion (2013) [2]
  • Increase US$ 1.82 billion (2012) [2]
  • Increase US$ 1.89 billion (2013) [2]
  • Increase US$ 1.41 billion (2012) [2]
Total assets
  • Increase US$ 10.44 billion (2013) [3]
  • Increase US$ 6.56 billion (2012) [2]
Total equity
  • Increase US$ 6.90 billion (2013) [3]
  • Increase US$ 3.89 billion (2012) [2]
Number of employees
9,000 (2014)[4]
WebsitePriceline.com

Priceline.com is an American company and a commercial website that claims to help 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 founded by Jay S. Walker, who left the company in 2000.[6] Hong Kong company Cheung Kong Holdings later purchased a significant portion of Priceline's stock.[7]

Chris Soder was named priceline.com's Chief Executive Officer in June of 2011.[8]

History

Priceline first became known 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 and/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, called Express Deals,where travelers are presented prices and are also told the name of the establishment.[9] 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.

In 2000, Priceline and certain of its officers were alleged in violation of Securities Exchange Act by issuing materially misleading information.[10]

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.

During November 2007, Priceline “permanently” eliminated all booking fees on published airfares.

Spokespeople

William Shatner

In 1997,[11] William Shatner became the spokesman for Priceline.com, agreeing to do the spots in exchange for stock in the company.[12] 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.[13]) 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, an ad campaign by Butler, Shine, Stern & Partners had Shatner take on the role of the Priceline Negotiator. In commercials that began airing January 22, 2012, Shatner's Negotiator character apparently dies as a bus falls off a bridge and explodes.[14] Subsequent ads have featured his "spirit," still advertising Priceline.com from beyond the grave. In August 2012, Shatner was brought back in a commercial located on a stormy, cloudy beach, parodying the end of the film Point Break. A man, apparently an investigator, stands next to Shatner. Shatner is holding a wooden surfboard, wearing a suit with shortened pants and pitching the new way of booking a hotel. He states that surfing is his life now and "we'll see where the waves take me. Sayonara!" and goes charging into the waves.

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

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.[15] However, this commercial has sparked controversy, since the commercial appears to make light of the Native American belief of smudging.[16]

JREF President DJ Grothe released an open letter 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.[17]

Kaley Cuoco

In January 2013, Kaley Cuoco from the sitcom The Big Bang Theory joined William Shatner as his fictitious daughter in Priceline.com commercials [18]

Acquisitions

Active Hotels

In September 2004, Priceline acquired Active Hotels Ltd., a hotel booking service in the European market, for £90 million.[19]

Booking.com

In 2005, Priceline acquired Amsterdam-based Booking.com, a competing reservation service operating primarily in Europe.[20]

Agoda.com

In November 2007, Priceline acquired Agoda,[21] an online accommodation booking service which provides a service similar to Priceline's but specializing in Asia Pacific. Agoda's network includes more than 380,000 properties worldwide.[22]

Rentalcars.com (Formerly TravelJigsaw)

In May 2010, Priceline acquired TravelJigsaw, an on-line car rental service.[23]

Kayak

In November 2012, Priceline announced that it had agreed to acquire Kayak.com in a stock and cash transaction, paying approximately $500 million in cash and $1.3 billion in equity and assumed stock options.[24][25] Kayak will continue to operate independently as a Priceline Group company.[26]

Buteeq

In June 2014, The Priceline Group announced acquisition of Buteeq, a cloud based digital marketing software for hotel owners. [27]

OpenTable

In June 2014, Priceline agreed to acquire OpenTable in a deal worth $2.6 billion.[28][29]

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.[30]

Criticisms

Priceline does not include resort fee amounts in the bidding. Therefore, it's possible to win a bid for a hotel and then be forced to pay mandatory resort fees (for example, often $25 per night for resort hotels in Las Vegas).[31] Priceline continues this practice despite a 2012 warning to the industry from the Federal Trade Commission (FTC).[32] The FTC continues to state the following regarding how hotels and third parties should disclose such fees:

Listing the “resort fee” near the quoted price or in the fine print — or referring to other fees that “may apply” — isn’t good enough.[33]

Priceline is one of the companies that uses the services of Wiki-PR, a public relations firm specialized in editing of Wikipedia that has been accused of subverting Wikipedia content for business interest. Leslie Cafferty, Priceline's vice president of corporate communications and public relations, explained, "We are using them to help us get all of our brands a presence because I don't have the resources internally to otherwise manage."[34][35]

References

  1. ^ "Priceline.com Incorporated Rankings". Hoovers. Retrieved December 16, 2011.
  2. ^ a b c d e f g h "PRICELINE COM INC 2013 Annual Report Form (10-K)" (XBRL). United States Securities and Exchange Commission. February 20, 2014.
  3. ^ a b "PRICELINE COM INC 2014 Q1 Quarterly Report Form (10-Q)" (XBRL). United States Securities and Exchange Commission. May 8, 2014.
  4. ^ "Investor FAQ Priceline". Priceline Group. Retrieved May 1, 2014.
  5. ^ "priceline.com Site Info". Alexa Internet. Retrieved 2013-05-02.
  6. ^ Post, Tom (September 18, 2012). "Priceline.com Cofounder Jay Walker On Turning The Art Of Giving Into A Systematic Business". Forbes.
  7. ^ "Ownership". MSN Money. Retrieved September 1, 2012.
  8. ^ "Christopher Soder". Forbes. October 2000. Retrieved Aug 7, 2014.
  9. ^ http://articles.latimes.com/2012/jun/27/news/la-trb-priceline-introduces-express-deals-for-hotels-20120625. {{cite web}}: Missing or empty |title= (help)
  10. ^ "Class Action Lawsuit Commenced Against Priceline.com Inc. (PCLN) By Bernstein Liebhard & Lifshitz, LLP". October 2000. Retrieved Jul 16, 2013.
  11. ^ http://www.hospitalitynet.org/news/154000320/4029964.html
  12. ^ Carlson, Nicholas (May 4, 2010). "William Shatner Has Made $600 Million Shilling Priceline.com". Business Insider.
  13. ^ "William Shatner Lives Long and Prospers -- but Did He Really Make $600 Million?". DailyFinance. Retrieved March 26, 2011.
  14. ^ Elber, Lynn (January 19, 2012). "Goodbye to William Shatner — again". News & Record. Associated Press. Retrieved January 19, 2012.
  15. ^ "TV's Long Island Medium Theresa Caputo Channels The Dearly Departed Negotiator In New Priceline.com TV Spot". Reuters. June 25, 2012. Retrieved November 1, 2012.
  16. ^ "Priceline: Remove the Long Island Medium smudging commercial from the air". Change.org.
  17. ^ Grothe, DJ (August 13, 2012). "Priceline.com: Will You Prove Your Spokesperson Worthy for a Million Dollars?". The Huffington Post. Retrieved August 15, 2012.
  18. ^ "Kaley Cuoco joins Shatner in Priceline ads". USA Today. January 9, 2013.
  19. ^ "Active Hotels Ltd., Sale to Priceline.com". TravelMole. September 23, 2004.
  20. ^ Levy, Ari (February 28, 2012). "Priceline.com's Shares Rise After Profit, Sales Exceed Analyst Estimates". Bloomberg Businessweek.
  21. ^ "Priceline.com Acquires Asian Online Hotel Reservation Service Agoda Company". Agoda. November 10, 2007.
  22. ^ "About Agoda?". Agoda. Retrieved March 31, 2014.
  23. ^ "Priceline.com acquires TravelJigsaw". Reuters. May 18, 2010.
  24. ^ "Priceline.com Agrees to Acquire KAYAK Software Corporation". Princeline.com. November 8, 2012. Retrieved November 8, 2012.
  25. ^ Smith, Olivia (November 8, 2012). "Priceline to buy Kayak for $1.8 billion". CNN Money. Time Warner. Retrieved November 8, 2012.
  26. ^ "Priceline to acquire Kayak in $1.8 billion deal". Boston.com. NY Times Co. November 8, 2012. Retrieved November 8, 2012. {{cite news}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help) [dead link]
  27. ^ "Priceline acquires Buteeq". Forbes. December 04, 2014. {{cite news}}: Check date values in: |date= (help)
  28. ^ "Priceline buying Opentable". CNN Money. Retrieved 13 June 2014. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)
  29. ^ "Priceline books OpenTable for $2.6bn". New York Telegraph. Retrieved 13 June 2014. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)
  30. ^ Brand Passion Index for Travel Booking sites NetBase, March 30, 2011
  31. ^ Hotels add resort fees to priceline
  32. ^ http://www.cnn.com/2012/11/28/travel/hotels-resort-fees-warning/index.html
  33. ^ http://www.consumer.ftc.gov/articles/0046-travel-tips
  34. ^ "Is Wikipedia for Sale? | Motherboard". motherboard.vice.com. 2013-10-20. Retrieved 2013-10-20.
  35. ^ Arthur, Charles (21 November 2013). "Wikipedia sends cease-and-desist letter to PR firm offering paid edits to site". The Guardian. Retrieved 22 November 2013. Among companies whose entries are said to have been edited by the company are those for Priceline and the communications company Viacom
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