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Hotwire indeed has been taking share from Priceline in the U.S. Hotwire is coming very late to Europe and Asia-Pacific, and can’t be assured of success there.
When Priceline killed William Shatner’s Negotiator character and tilted away from Name Your Own Price bidding by introducing an Express Deals product that looks awfully familiar, Hotwire Group president Clem Bason knew what was going on.
Priceline, with its Booking.com unit running wild and growing, has been emphasizing published-price hotel sales, and admits that Priceline has been losing market share in Name Your Own Price hotel sales since the third quarter of 2011.
Bason of Hotwire says he sees strength in his company’s opaque sales, where you know the discounted price up-front but not the hotel name in advance.
Meanwhile, Priceline’s hotel, flight and car-bidding business, where you have to submit a hoped-for price and don’t know the hotel identity in advance, has been “shrinking,” Bason says.
Going at it for more than 10 years
With Priceline always arguing over the last decade that the two companies have butted heads that Name Your Own Price was a better model for suppliers, Bason gets some satisfaction that Priceline’s new Express Deals basically uses the Hotwire way of selling.
“We don’t view it as a threat,” Bason says. “I do see it as vindication that they launched Express Deals. If you look at it, it is a near copy [of Hotwire]. There’s not much originality to their product.”
To be sure, Priceline’s bidding business is not just feeling the heat from Hotwire, but also from a national advertising campaign run for Expedia Unpublished Rates [developed by its Hotwire subsidiary], Travelocity’s Top Secret Hotels, and others.
Bason says Hotwire has been “growing well” and that the “strength from our side” comes from product improvements and facilitating more trust in the process, including showing travelers’ recommendations about the property.
While Priceline puts more emphasis into its retail published-price business, “for us opaque remains a focus,” Bason says.
Meanwhile, Hotwire is coming late to the international game, and over the past two years has launched seven sites in Europe and Asia-Pacific.
Bason says Hotwire is “starting from scratch” in Europe because its model doesn’t broadly exist there, although LastMinute.com has used a similar approach for years.
“So far, it’s been really solid,” Bason claims, adding that Hotwire is “building supply across the continent.”
Some additional local-language sites, and additional TV advertising abroad next year.
Asked to name the target countries, Bason says final decisions have not been made yet.