Fool.com: Why I'm Never Using priceline Again (Fool on the Hill) March 13, 2000

FOOL ON THE HILL
An Investment Opinion

Why I'm Never Using priceline Again

By Yi-Hsin Chang (TMF Puck)
March 13, 2000

I'm filing this report from London, England, where I'm spending my spring break from NYU Stern. I couldn't wait 'til I got back to share this cautionary tale about priceline.com (Nasdaq: PCLN).

It all started a couple weeks back, when I bid for two roundtrip tickets to London for my hubby and me using priceline.com. I bid $150 a ticket and filled out some promotional application form from Discover Card that would add an additional $35 ($70 total) in "sponsor dollars" to my bid. Why not, right? I can always cancel the card. It was the largest bonus of the promotional offers and seemed the most painless.

Following the parameters set by priceline, I selected the departure and return dates, and I agreed to fly out of New York from one of three airports -- JFK, LaGuardia, or Newark, New Jersey. The kicker was I also agreed to depart "any time, midnight to midnight, on [my] date of travel, and [I] agree[d] to make at least one connection each way." I figured we wouldn't actually have to make a connection on the trip. It's New York to London -- where could one logically stop? I mean, you can't stop in the middle of the Atlantic, right?

I submitted my request along with my credit card information and waited to hear back from priceline. I got an e-mail message within an hour, as promised, that told me that my bid was unsuccessful but that I could resubmit and increase my chances by changing my bid.

When I returned to the website as directed, I was advised to change the departure and/or return date, the airports I was willing to fly out of, and the number of connections I was willing to make. Surprisingly, it specifically said there was no need to change the dollar amount of my bid. I fiddled with the dates and resubmitted my request.

Once again, I got the same e-mail message. Not willing to make more than one connection or fly from a regional airport for an international trip, I resubmitted after selecting another date. This process repeated itself several times as I tried various combinations of reasonable departure and return dates given the span of my spring break.

Still, no luck. Finally, on my fourth or fifth attempt, I upped my bid to $165 a ticket from $150, even though priceline said I didn't need to. Voila! This time the bid went through. I was pretty proud of myself, getting tickets to London for $165.

My sense of accomplishment was quickly deflated when I glanced at my itinerary and bill online. The fare was indeed $165 each, which came to $330. But the taxes and fees came to $212! That's 64% of the ticket price! I expected some taxes, but not an amount that would nearly double my bidding price. Adding in the required $12.50 for priceline to FedEx me the tickets, my total came to $554.50.

What's more, we were departing from Newark, New Jersey, and would have to make one connection. Our itinerary had us going to London via Dusseldorf. Yes, the one in Germany. We were to stop in Frankfurt on our way back. The tickets were for Lufthansa, the German-based airline, but it still seemed ridiculous to have to fly past London, stop in Germany, and then get on another plane to fly back to London.

Needless to say, I was less than pleased about my priceline experience. Not only was I peeved that we would have to leave from Newark, the least convenient of the three major airports in the New York metropolitan area, I was disappointed that several hours would be added to our travel time by having to fly through Germany.

I called priceline's 1-800 number to complain about the exorbitant taxes and fees, that the website did not fully disclose the extent of the taxes. Plus, I argued, the taxes should be included in the bidding price. Airlines and travel agents quote fares inclusive of taxes. I made a bid based on what I was willing to pay in total, not before taxes.

I spent 42 minutes on the phone -- much of it on hold -- and talked to two "customer care" representatives, one supposedly more senior than the other. The upshot was they offered to cancel my itinerary, refund my money, and credit $50 to my account so that I could resubmit my bid. Not willing to risk not being able to book flights to London, I declined the offer, feeling very unhappy. I was given an e-mail address for someone in charge of the complaints department, whom I e-mailed but from whom I never got a response.

A couple days later I called priceline again, figuring I'd go ahead and cancel the itinerary. This time I was informed that there would be a $75 cancellation charge per ticket -- that's $150, nearly half the price of the fares. I told the reps that I had spoken with two people earlier who had said they could cancel the tickets with no mention of a cancellation fee. I was told there was no record of that conversation.

Then the guy had the gall to say to me: "Do you have another concern? If not, this call is concluded."

"Are you trying to hang up on me?" I asked.

"No, but do you have any other concerns?"

I cannot fully express my disgust at priceline. I am still appalled by the low level of customer service, and the company's policy of not including taxes and fees in the binding bidding process is deceptive.

Since sharing my experience with several friends and classmates, I have heard some terrible priceline experiences. The worst was a woman who got out to the airport only to be told that her flight was canceled and that she would not be put on another flight since she had a priceline ticket, which is non-exchangeable and non-refundable.

As a consumer, you have to make many compromises in order to use priceline's services. What you are saving in dollars -- if you're saving at all -- you are paying for in time and convenience. This is no economic ideal, but a process that makes travel downright unpleasant and cumbersome.

Don't get me wrong, I'm having a blast here in London -- I wouldn't give priceline the satisfaction of ruining my vacation. But I'll never use priceline again.