Tuesday, December 14, 2010

Priceline's Name Your Own Price--Travel's Version of the Grab Bag

Thanks to everyone for reading and submitting your questions! We had some great feedback regarding last week's columns, and we appreciate everyone's comments. Keep the comments and questions coming to hgimayfaire@gmail.com, and we'll do our best to get all of your questions answered!

This week's question was submitted late for Friday's column, but we hinted at it. It actually follows up very well on Friday's blog entry in which we wrote about rates and closed with a few words on shopping for value. A reader asks:
"I have thought about trying to rent a hotel with Priceline's 'Name Your Own Price' feature a few times, but I always chicken out when I go to the site. I know I can get a lower price that way (...but) I guess I'm just not sure how I can know what I'm getting. How does that work?"

Another great question, and thank you!
The feature you're asking about is what folks in the travel industry call an "opaque" site; in other words, it's a website where you can't see any details unless you've paid up front. Priceline now offers a "regular" booking site similar to Expedia, Travelocity, and Orbitz, but they still offer the "Name Your Own Price" option, which is what we are discussing here. Other well-known opaque sites include Hotwire.com and LastMinute.com (formerly Site59.com). These sites can offer advantages for both travel vendors (hotels and rental car agencies) and for customers. For the vendors, it helps to make an end run around any rate guarantees they may have and allows them to sell off any unused inventory at much lower than normal prices without revealing that they are doing so. For the users of those websites, the prices can at times be up to 70% lower than the "retail" price of the room or car. You have, though, hit upon the real drawback of purchasing through opaque sites--for all intents and purposes, you're reaching into a huge grab bag and you've already paid for (and cannot return) what you pull out.

To be fair, Priceline (and we will continue to use Priceline as the example, as they are the most prominent opaque site) allows you to choose the "star level" of hotel you want when you are selecting a hotel. As consumer advocate Clark Howard pointed out just last week, though, the star levels at these websites often fail to match up with the online reviews. Star levels on Priceline are based almost entirely on the brand profile of the hotel rather than the quality of the product or service offered. (Rental cars operate differently, as Priceline works exclusively with 5 national rental companies.) So by selecting a "star level," you are essentially selecting a "style" of hotel rather than a quality.

In addition to that, you have no flexibility with the opaque sites. You should never use an opaque site to purchase a hotel room if you have very specific travel needs (multiple people in one room, allergies, disabilities), because when you book through one of these sites you are guaranteed only that the hotel has a room available for you--that room may be smoking or non-smoking, pet-friendly or not, one bed or two, and any bed size--and even calling the hotel directly to request special accommodations will rarely have an impact. You cannot change your dates, cancel, or otherwise alter your reservation in any way. In other words, booking through an opaque site means you will have a room when you arrive. Period.

At this point, we should return to the point we made in Friday's column. Effective "shopping" for a hotel room should be more about the value for your dollar than about price, and you have no way of determing the amenities and services available or the quality of an establishment on an opaque site. The opaque sites are perfect for the traveler who has absolutely no expectations of a hotel room than a place to lay his or her head for the lowest price possible, but for travelers with expectations even slightly higher than that, these sites are a huge gamble. Most of the time, the price is only a few dollars different than the price you would find on the other online sites, anyway--and that's a relatively small price to pay for peace of mind.

And what have your experiences been with opaque sites? Have you had good experiences with booking that way? Bad experiences? Crazy mishaps? Leave us a comment or send us an email to let us know.

Thanks for the question! We appreciate you taking the time to let us assist you! Keep the questions coming to hgimayfaire@gmail.com, and look for us again on Friday!

Scott

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