Priceline.Com Harvard Business Case Essay Example

one arena. Instead of offering everything under the sun from food to long distance to mortgages and auto sales, streamline the offerings.

Priceline could focus exclusively on travel related products. Flights, hotels, vacation packages, cruises etc. Alternatively priceline could focus on just ticket sales. Not only airline tickets but also movie tickets, sporting tickets, theatrical tickets and others such as museums and amusement parks.

International Option

Currently priceline offers flights that must originate in the United States or Puerto Rico. Priceline could expand its offerings to international flights, international hotels, car rental and other vacation products to consumers who are seeking to travel outside of the country. This would exponentially increase the market presence as not only would this service be used by Americans seeking to go abroad but also by those in other countries where the services are offered.

Service Options

Instead of fighting off competition from airlines offering flights for sale on their own websites, form alliances and contracts with the airlines which would centralize all flight booking.

Users to airlines individual websites would be redirected to priceline. Priceline would serve as a service site facilitating the purchase of airline tickets and receive a commission on each flight as payment.

Best Solution

By using the concentration option and going with just travel related products, priceline can reposition itself without changing its identity.By focusing on what it does best, priceline can concentrate on offering travel products rather than spreading itself to multiple industries and products.

Priceline would focus solely on the travel industry which would reinforce its brand power. Automobile sales, food, financial products and communication products would be replaced by vacation packages, train and bus tickets and cruises. Justification This solution is

the best strategy because:

• Travel is what priceline is known for and what its original intent was. Travel tickets and hotel rooms make up an overwhelming majority of pricelines revenues.
• Offer on screen pricing for those who are not interested in making their own price offer.
• Bundle services to offer vacation packages and substantial discounts.

Argument It can be argued, however, that our solution suffers from the following drawbacks:

• Competitors already implementing this approach.
• Travel industry is too segmented.
• Customers may prefer ease of expedia. com.

Counter-argument The above argument is not well-founded because: Priceline has a competitive advantage over competitors based on its marketing plan and name recognition, by adjusting itself to better suit customers and fend off competitors priceline is already ahead of the pack.

• By offering travel packages priceline can become a one stop shop for business and leisure travelers.
• Successful attributes of all competitors would be studied and incorporated with pricelines already existing patented technology.

Conclusion

Pricelines core competency is its ability to offer a product buyers want at prices they demand. By retaining this attribute but also offering the opportunity for buyers to purchase all of their travel related products at the lowest price possible priceline is able to reach out to cost conscious shoppers in the travel industry.

By focusing on what priceline is well known for and improving it to accommodate more buyers and more flexible options, priceline should retain a high customer return rate. Additionally, by narrowing the focus of the company to just travel products priceline will position itself as a true destination website – anyone desiring to travel will want to check with priceline before going elsewhere.