Priceline Guarantees Sunshine, Gets Conversion

Have you ever had a relaxing getaway at the beach rained out and wished there was some sort of compensation you could get for your lack of a tan? In the absence of a long-awaited good weather guarantee from Mother Nature, Priceline (PCLN) has stepped up and taken the initiative. Their quirky Sunshine Guaranteed offer promises to refund vacation package purchases if an excessive amount of rainfall takes place on the trip. Innovative and strong performing promotional campaigns like this, along with a discount and price-focused product and marketing mix have helped make Priceline’s website conversion rates near the highest among online travel agencies.

Priceline’s shopper conversion rate (the percentage of those who perform a search on the site that ends up completing a booking) is 7%, nearly two percentage points higher than the OTA average of 5% (red bars). Promotional Clickers on Priceline, those who engage with some kind of promotional content while on the site, have an exceptional conversion rate of 13%, nearly twice the OTA average (blue bars).

In June, 12% of Priceline’s site traffic clicked on a promotion. While the Sunshine Guarantee promotion may attract only a niche audience (0.2% of Priceline shoppers), those who do click on this promotion are highly likely to convert – an impressive 24% of Sunshine clickers will complete a booking. Despite attracting relatively few clickers, it resonated with its audience and led to strong conversion rates, showing just how effective a smaller, targeted promotion can be.

Expedia’s recent Summer of Adventure campaign was another successful promotion, on a different scale. In contrast to Priceline’s Sunshine Guarantee, Expedia’s promotion generated huge online exposure among visitors to the Expedia website.

Compete’s data is evidence that both large campaigns like Expedia’s and more targeted offers such as Priceline’s Sunshine Guaranteed can be effective in the same market.

Comments

[User 243269:]

Buying from Priceline's web site is not the problem...getting what you paid for is.

When my wife and I arrived at the Priceline-booked hotel in Cancun, Mexico, the hotel had no record of our reservation and said they were unable to contact Priceline on our behalf.

In order to secure a room, we were forced to give the hotel a credit card.

Since Priceline does not offer a toll-free phone number from Mexico, nor a collect call option for customers, we were forced to purchase telephone cards that would allow us to utilize the Mexican phone system and contact Priceline. These phone cards cost 900 pesos--about $90-$95 in US currency.

After several phone calls to Priceline's automated phone system and after being placed on hold for long periods, Priceline finally contacted the hotel and fixed the reservation. The issue was not corrected for more than 24 HOURS.

For one entire day of our trip, my wife and I had no idea if we would end up having to pay twice for our PREPAID Priceline trip.

We paid for a WEEK in Cancun. We did not receive a week in Cancun, as the first day of our trip was stressful and we were unable to get ANY assistance from Priceline.

I've asked for a reasonable refund of 1/4 of my contract price, plus $90 for the Mexican phone cards. So far, Priceline has not responded nor refunded anything.

Needless to say, I will not use them again.

2008 Aug 14 08:36 AM

[Ex15:26:]

So you didn't call to confirm your reservation before you left?

It stinks that PCLN and the hotel didn't get their communication synced, but why would you ever, ever, ever think that you should book a flight, hotel, or rental, without confirming a day or two in advance? I'm not sure what kind of traveler you are, but I am a freak about ensuring that all details are confirmed and re-confirmed so I don't have to endure the trauma you faced.

I'd give PCLN another chance (maybe here in the states first), but always confirm via phone before you start your trip. Why risk it?

2008 Aug 17 04:19 PM

[Think-About-It:]

Does Priceline do any business in China? How much of their business is in Asia or outside the U.S. & Eurozone? I like PCLN but think we are in for a recession...

2008 Aug 25 10:26 PM