Priceline, founded in 1997, was pioneering for the system Name Your Own Price, where people can bid for flight tickets, hotels, and rental cars based on the price they are willing to pay. In such a way, it has changed the way that customers booked travel.
However, Priceline killed its original product Name Your Own Price for flight on 1 September this year, since the industry dynamics have changed. More customers prefer to use mobile devices than desktop or laptop, which makes the bidding process too cumbersome. Just as Lemarchand-Wood said, it was a result of “a dramatic evolution in both technology and customer behaviour when it comes to booking travel.” Priceline moves to Express Deals for flight, which helps customers to book online much faster and easier since the bidding process is removed. Through this new model, Priceline offer travel products at discounts of 30% – 40% with semi-opaque flight information, such as people can only know the name of airline, the time of the flight, and the number of stops after their purchase.
Priceline still offer Name Your Own Price bidding for hotels and rental cars, but it seems that they will also eliminate Name Your Own Price for these two sectors.
The performance of Name Your Price is decreasing over the past few years, according to Priceline Group’s Financial Report. At the meanwhile, Booking.com is growing very fast. In addition, it will decrease customer experience if there’s no heavy discount when a customer enters a Name Your Own Price bid. Moreover, if customers always bid too low and suppliers are not willing to offer extra discounts anymore, they are not able to make a deal, which will also decrease customer experience. Furthermore, booking a Name Your Own Price deal might put the customer at the lowest priority when something bad happens, according to the customer complaints and reviews online.
All above, these facts are showing that Name Your Own Price system will not be the core of Priceline in the future. Do you think Priceline will eventually end Name Your Own Price for hotels and rental cars?
References:
https://skift.com/2016/09/02/priceline-kills-name-your-own-price-for-flights/
http://files.shareholder.com/downloads/PCLN/2944439744x0xS1075531-16-109/1075531/filing.pdf
https://www.consumeraffairs.com/travel/priceline.html
Great article! Name your own price is now pretty outdated, unreliable, and not completely profitable. It would be better for them to switch strategies. Name your own price did not help many organisations in establishing themselves in their industry.