No site inspires both delight and frustration quite like the one responsible for keeping Bill Shatner busy in the autumn of his years. Founded back in 1998 by entrepreneur Jay Walker, Priceline received more than half a million hits on the day it launched. A year later, the company went public, much later, it actually turned a profit.
Walker, a Cornell grad, was the man behind the revolutionary idea that made Priceline a household name in the past decade. Like most revolutionary ideas, it was pretty simple: Let the customer feel empowered by allowing them to decide how much they wanted to pay for something, then match them up with vendors who needed to deep-discount and give them the chance to do so without having to blab to the world that they’re having trouble unloading product.
It almost didn’t work — Priceline nearly went under shortly after the 1998 launch. It’s not that nobody was using it, it was that it was too successful. Unable to find enough cheap travel to meet crazy demand, the site was forced to go out and buy tickets from the airlines — it was a hiccup in the system that almost bled them dry. A decade later and after more than one major upheaval, the company is prospering — pretty surprising at a time when the rest of the industry is in serious trouble — with revenues of $2 billion estimated in 2009.
Part of this success, it seems, has been Priceline’s willingness to branch out from bidding to straight-up selling set-price product. This, of course, doesn’t seem like the most innovative move. After all, this just makes them more like the old-school biggies like Expedia and Travelocity. The last laugh’s on the doubters — according to a story in Forbes Magazine last August, sales of set-price travel product now account for two-thirds of Priceline’s profits.
Hey — if it keeps them in business, and keeps them hanging around for when someone like me wants to pay, say, $40 for a suite at a three-star Marriott property in West Texas (as I did this past December), that’s great. Can’t usually find prices like that published on the web.
In fact, in a dismal year like 2009, it was often easy to save nearly 50 percent off of the cheapest published rate for hotels — even in pricey Chicago, where we scored big, getting three-star accommodations downtown for $125 on one of the busiest weekends in 2009. The rack rate at the hotel during our stay was more than $250.
Simply put – if you’re flexible and spontaneous, this is one of the finest assets a traveler can have in their bag of tricks. For sure, there are ups and downs — at that hotel in Chicago, they put me in a garbage room and didn’t get around to actually saying I could move rooms until the last night of my stay. Then there was another hotel in Texas where the staff got way less than happy to see me when the rate I was paying (again, around $40) popped up on the reservations screen. (Question: Why does the rate even show up, if it’s prepaid? The desk clerks don’t need to know, do they? And why should they care, anyway?)
Also, if something goes wrong, don’t count on a quick fix. While those needing customer service won’t necessarily suffer through hours of waiting on the phone anymore (who could forget the time my cordless phone went dead trying to get rescheduled when my Priceline-booked flight was cancelled due to weather back in ‘99), it does take patience to get problems solved. Then again, one could say the same thing for Expedia, for Travelocity, for Hotwire, CheapOair and every other third party you use.
In summary: While you’ll never catch me recommending a discount site over dealing with the actual seller — for instance, your Hiltons, your United Airlineses, your Hertz Rent-A-Cars — Priceline really does work for when you need cheap and you need it fast. For one-night stays at hotels, it’s almost required (after all, everyone can put up with a bad room for at least one night). For last-minute travel, when you’re at no risk of having to cancel your trip, it’s almost essential. Everything else? Tread lightly.
Learn more at priceline.com.