There is something peculiar about Priceline.com (NASDAQ:PCLN) hooking up with Zagat this week to provide exclusive hotel reviews and destination guides. Wasn't Priceline the portal that was always shrouded in secrecy? The one where prospective travelers would blindly bid on overnight accommodations? They could narrow down the selection process to a specific metropolitan area and the caliber of hotel, but that was pretty much it. It wasn't until after they committed to the non-refundable purchase that they were told exactly where they would be staying.
My, how Priceline has grown up these days. The original "Name Your Own Price" model is still there, promising deep discounts for those with a penchant for mystery, but the site now defaults to the more conventional portal for booking flights, hotels, cars, cruises, and vacation packages. It's obviously a better business model. The original format was deep-fried in rejection, with as many as five of every six bids rejected as too low. Priceline is in much better financial shape these days, now that its head is perpetually bobbing up and down in the acceptance pool.
And Zagat's trusted name is no stranger to Priceline users; the site had previously leaned on the editorial provider for some locations. This new deal spans thousands of hotels in over 600 different cities, and destination guides will give up the skinny on nearby restaurants and attractions. Also in the works will be printable Zagat Survey guides for those who complete their bookings through Priceline. That is a nice touch, especially since way too many people are using portals for initial research before booking directly through the hotel or airline to see whether a better deal can be had.
The Zagat content will be presented alongside existing Priceline customer reviews. In that sense, Priceline is simply doing what it can to keep up with Expedia (NASDAQ:EXPE). Thanks to TripAdvisor.com, Expedia has always been the leader in consumer-generated travel reviews.
A little mystery can be a good thing. Priceline is getting good mileage out of its new William "The Negotiator" Shatner ads. Expedia owns Hotwire. Travelzoo (NASDAQ:TZOO) has millions of opt-in subscribers to its weekly list of travel bargains. Even Amazon.com (NASDAQ:AMZN) will send out monthly travel bargain emails. Yet those niches are only good for style points. Priceline had to get a little vanilla bean to find its true calling -- and with pro forma profits more than doubling this past quarter, one would argue that it's quite the calling -- but vanilla can still be quite tasty.
Priceline.com and Amazon.com are Motley Fool Stock Advisor recommendations. You can check out a free 30-day trial to see if the service is right for you. It's more than just vanilla.
Longtime Fool contributor Rick Munarriz still relies on portals to get basic travel information, but then he finds out whether better deals can be had directly with the provider. He does not own shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.
