The Booking Holdings (BKNG 1.11%) family of brands, which includes Priceline, Booking.com, Kayak, and a number of others, makes it both easier and harder to book travel. The easy part is that the brand's sites allow consumers to compare prices or explore different deals without using a travel agent. The challenge is that when you use a site like Priceline, it's hard to know if you're making the right choices or getting the best deal possible. Despite that, there are lots of strategies to using these sites to get a good deal.

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This video was recorded on Aug. 20, 2019.

Shannon Jones: We're going to be talking about online travel booking stocks, and maybe get a few tricks of the trade from traveler guru himself, Dan Kline while we're at it. We'll dive into two of the major online travel and reservation sites, Booking Holdings and Expedia. Two companies, Dan, they control over 70% of the online travel market. That is huge to me.

Dan Kline: Yeah. I will say, both companies have made travel easier and harder. Back when I first started traveling for business -- I'm 45, my first business trip came when I was 20, so you can do the math there. A lot of years ago. We called a travel agent who had magic tools in front of her, probably some sort of computer, and figured out what the best price was for what we were trying to do. Now, when I book travel -- and I travel two or three times a month; I come up there usually once a month -- when I book travel, there's always this nagging suspicion that I've somehow left money on the table because when you look at the various properties owned by Booking, which include Priceline, KAYAK, booking.com itself; or Expedia, which owns Expedia, Hotwire and a whole bunch of other things, there's all sorts of different ways to book travel, and it's not always easy to figure out which one to use. And that benefits these companies.

Jones: That's a good point. Let's actually dive right into Booking Holdings. This would be the largest of the two. Actually, just from a market cap standpoint, it has a market cap of $82 billion right now. The company previously known as Priceline, and it's gone through a couple of name changes. Now it's known as Booking Holdings, ticker BKNG. Dan, I was looking at Booking Holdings. 2019 hasn't necessarily been a great year for them so far. At one point, they were down nearly about 20% off of their highs from 2018. But, tell us first, what is Booking Holdings? They've got a lot going on.

Kline: They're a collection of travel sites; in addition to that, they own Open Table, which is somewhat of an outlier, though it's obvious to see how restaurant reservations and travel match up pretty well. But, their core sites in the U.S. are booking.com, which is kind of a traditional travel site -- you go to booking.com and you say, "I want to visit Orlando a week from now. I'd like to stay in a hotel, and I don't want to make any stops." And it gives you the best pricing or the most convenient pricing -- it actually gives you multiple options. Sometimes it's the cheapest, and the cheapest can be really strange, like, you leave from one airport and fly home to another. And, you can pick cheapest or best, and all sorts of different options.

Priceline is a travel bidding site. This is actually my site of choice. What happens on Priceline is, you can go in and you can see what's available and what the prices are. Then, you have a couple of other options. Priceline is famous for its Name Your Own Price tool. What that means is, I can say, "You're showing me hotels in Alexandria, Virginia downtown. The cheapest hotel is the Westin for $199 a night." That's where I usually stay. "I don't think that's the best deal I can get." So, you have two options. You can go into Express deals. Express deals will show you the area of the hotel, how many stars it is, and what its rating is -- basically, do people like it or not, on a 0% to 100% scale. And you can say, "Alright. I want a three-star hotel, Alexandria, Old Town, I don't care what it is," and you get it, and it comes back, and it's one of four hotels because there's only a few in the area, and you're relatively happy with it. Or, you can do Name Your Own Price, which doesn't show you any price. You say, "Alright, I want a three-star hotel," same thing, "downtown, Old Town, Alexandria. I'm only willing to pay $75 for it." And you put that offer in, and it might come back to you one of three ways. It can reject your offer. They might come back and say, "Hey, nobody's willing to sell it to you for $75. But if you increase your offer to $92, you have a really good chance." In fact, I've almost always gotten my room when it does that. The third choice is, it comes back and says, "Hey, you didn't get it," and you have the option to go in and make some changes. You can lower your star rating, you can add another area, you can change your dates. And it becomes this game of, how low will the hotel go? Same thing for airfare. And, when it comes to airfare, there's certain parameters. You can say, "No redeyes." But, if it's a short trip, you might find yourself booking tickets that leave late Monday night and really early Wednesday morning, and it minimizes your trip. So you have to be really careful, but I find that it's an area where you can save a lot of money if you're not married to one particular brand or another.

Jones: Dan, I have to ask -- I've never used Priceline, but in using that service, the Name Your Own Price tool, what's your success rate when you submit a price? Would you say 90% of what you submit gets accepted? What does that look like, percentage-wise?

Kline: If I'm using Name Your Own Price, it's probably 60/40. That said, I'm only going to use Name Your Own Price in an area I know really well. For example, Alexandria is not a big city. When you look at how Priceline in its full disclosure area breaks it up, you can see that there's four to five three-star or four star-hotels that are sort of close to the office. The farthest one away is a little bit far in the winter, so you might want to take an Uber if it's snowing or it's really cold out. I know the area, and nine months out of the year, if I do a blind bid, I know that yes, I want to get the Westin or one of the two or three hotels very close to the office; on the other hand, I won't be upset if I get the one that's about 1.25 miles away. So, I know the area; I know every possible hotel it's going to put me in; and I'm comfortable doing a blind bid.

Sometimes I'm less comfortable doing a blind bid. Maybe I got rejected on one and I need to expand my area, or I couldn't get the Express deal I wanted, and I want to try different things. In those cases, you really just have to do your homework. Look at what's around, figure out what the brands are. You can see what was just booked. And sometimes, if you do the Express deal, it gives you little hints, like, "You've stayed here before." Well, if I've only stayed at one hotel in that area, I know what it is. If I've stayed at two or three, you have to think, "Gee, did I like all those hotels?" When I stay out by Baltimore near the casinos, there's three or four hotels of the same star range, and two of them are walking distance and two of them are not, and sometimes I'd really prefer being walking distance, so it makes sense to not do a blind bid and to book something when I know what it is.

So, you have to be very, very strategic, and you have to do your homework.