Travel Weekly technology editor Dennis
Schaal sat down with Priceline.com President and CEO Jeffery Boyd to
discuss Pricelines launch of a full retail offering.
Q: With your launch of hotel and car and
its integration with your opaque business, do you see Priceline
directly competing with Expedia, Travelocity and Orbitz? Is there
room for another player?
A: I think the market is certainly big
enough to have room for four large players to grow and
Q: What will your new offering do for your
A: If you look at how Priceline performed
over the last 12 to 16 months, we grew faster than other online
travel agents because of the successful introduction of products
and entry into new markets.
tickets (launched in January 2004) was a big piece of that. If the
new product launch for hotels is anywhere near as successful, I
would expect our business would gain share and continue to gain
share as we have done historically.
Q: Would you gain enough share to unseat
one or more of the Big Three?
A: Through a combination of organic growth
and acquisitions there is a possibility for us to get to be of the
same size as the three largest players. Travelocity and Orbitz are
a little more than twice our size in terms of gross bookings, so
under any scenario, its not going to be easy to catch them purely
from organic growth.
Q: How are you going to differentiate
A: I think we have a built-in advantage
because our brand is shown in all the studies we do to score very
highly in value attributes. People think of Priceline as the place
to come for the best deal in travel.
Q: In adding retail to your opaque
business, arent you almost competing against yourself?
A: Thats something we were concerned about
when we launched the airline ticket product. What we found was that
we were able to convert customers we would have lost, customers who
would have not purchased an opaque ticket because they wanted to
pick their own flight times. We found with airline tickets that the
retail offering was mostly incremental business. We were down 40%
prior to the launch of the airline ticket product, and we were able
to flip that to be up by more than 50%.
Q: Now that you have a full-fledged retail
product, will you participate in the meta-search
A: If they want to be partners of
companies like Priceline and the other large online travel agents,
they are going to have to establish a value proposition to us as
advertisers. They represent one set of tools, which until now has
not gotten broad traction with customers. The only reason they are
a topic of conversation is because Yahoo and AOL have decided to
turn their fire hose and traffic onto these businesses.
reporter Dennis Schaal, send e-mail to [email protected].
details on this article, see "Priceline ups retail offerings with hotel, car rental