Priceline.Com Essay

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Introduction Priceline.com was founded and launched by Jay Walker in April 1998. Priceline flipped the conventional marketing system where buyers could advertise a unit of demand to a group of sellers. The sellers could then decide whether to fulfil that demand or not. The customer could advertise his/her demand by logging on to Priceline.com. Customer had to be flexible on time of travel and brand of supplier. The customer could not back out once Priceline had assigned it a seller. Priceline made its entry to the market with introducing its policy over providing Airline Tickets in 1998 and later moved on to automobiles, hotel rooms and home financing by introducing “name your own prices” service. Problem Priceline appointed new Chief Marketing Officer (CMO) in January 2000. The objectives for appointing new CMO can be given as: • Enhance the brand and strengthen its position in multiple product categories. • Expand into new categories • Determine the category best suited for Priceline service • Grow the revenues to over $1 billion Problem Analysis Here, the CMO had to come up with strategies to outwit its competitors. Expedia was a leading online travel service. Priceline had direct competition in the “name your own prices” service with Expedia. Expedia provided extensive destination information and strong editorial content with multiple booking options and focused on – flights, hotels, cars, vacations and cruises. Since Priceline was extending its brand across multiple product categories, it had to compete against niche players like CarsDirect in automobiles and Lending Tree in home financing. Background Brand Building Priceline followed an “aggressive brand-enhancement” strategy which included mass market and multimedia advertising, promotional programs and public relations activities. It had invested $24.4 million in1998 and $79.6 million in

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