Priceline.com and the Search for a Business Model that Works N AME Y OUR O WN P RICE “ NO ONE DEAL LIKE WE DO” Prese...
Contents 1 Case Background 2 Priceline.com Business Model 3 The future of Priceline.com 4 Travel Industry Impacts 5 Curren...
Background Start Business One Stop Shopping!! Hotel Reservation “ Reverse Auction ” Products Airline Ticket Financial Serv...
Background Expansion Phase “ Priceline Webhouse Club” Beginning of 2000 Extend Model - Groceries - Gasoline - Used Goods ...
Background Reorganization Phase Core Business “ Richard Braddock” New Chairman “ Discount Retail” 2003 – 2004 Extension ...
Background Boom!! “ International Business” 2004 - Active Hotels Integration 2005 – Booking.com 2007 – Agoda
Question1 <ul><li>W hat are the core </li></ul><ul><li>components of Priceline’s </li></ul><ul><li>business model? </l...
Components of Business Model <ul><li>Value Proposition </li></ul><ul><li>Revenue Model </li></ul><ul><li>Market Opportun...
Components of Business Model <ul><li>Consumer Side </li></ul><ul><li>Low Cost with some </li></ul><ul><li>additional co...
Components of Business Model <ul><li>Transaction Fee </li></ul><ul><li>Booking & Handling Fee </li></ul><ul><li>Adaptive...
Components of Business Model <ul><li>Marketspace </li></ul><ul><li>Travel Service Industry </li></ul><ul><li>started fr...
Components of Business Model <ul><li>Direct Competitors </li></ul><ul><li>Travel Agencies </li></ul><ul><li>e.g. expedia...
Components of Business Model Lower Price from “Reverse Auction” Fast Response, Reliability & Standard First Mover Ad...
Components of Business Model <ul><li>New Trading Model “Name Your Own Price ® ” </li></ul><ul><li>Brand Ambassador “Will...
Components of Business Model <ul><li>O rganization </li></ul><ul><li>Development </li></ul><ul><li>& </li></ul><ul><li>M...
Core Components of Priceline.com <ul><li>V alue Proposition </li></ul><ul><li>R evenue Model </li></ul><ul><li>C ompetitiv...
Question 2 <ul><li>D o you think Priceline will </li></ul><ul><li>ultimately succeed or fall? </li></ul><ul><li>Why? </li...
Question 2 Success Factors <ul><li>Focus on Core Business </li></ul><ul><ul><li>Travel Reservations </li></ul></ul><ul><li...
Question 3 H ow has Priceline (and similar online services) impacted the travel services industry?
Question 3 Customer Effects <ul><li>Positive Effects </li></ul><ul><ul><li>Increase Customer </li></ul></ul><ul><ul><li>Ea...
Question 4 <ul><li>F ollow up on developments at Priceline since Sep 2008 when this case study was prepared. </li></ul><u...
Question 4 <ul><ul><li>H as its business model and/or strategy changed at all, </li></ul></ul><ul><ul><li>and if so, how? ...
Iphone Application
Priceline Competitor <ul><ul><li>Who are its strongest competitors? </li></ul></ul>
Question 4 <ul><ul><li>Who are its strongest competitors? </li></ul></ul>
Question 4 <ul><ul><li>Is it profitable or operating at a loss? </li></ul></ul>
Question 4 <ul><ul><li>Is it profitable or operating at a loss? </li></ul></ul>
Class Discussion <ul><li>Q & A </li></ul>
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Priceline Presentation

Published on: Mar 4, 2016
Published in: Business      Travel      
Source: www.slideshare.net


Transcripts - Priceline Presentation

  • 1. Priceline.com and the Search for a Business Model that Works N AME Y OUR O WN P RICE “ NO ONE DEAL LIKE WE DO” Present by Group 2
  • 2. Contents 1 Case Background 2 Priceline.com Business Model 3 The future of Priceline.com 4 Travel Industry Impacts 5 Current Situations
  • 3. Background Start Business One Stop Shopping!! Hotel Reservation “ Reverse Auction ” Products Airline Ticket Financial Service Car Rental “ Name Your Own Price ® ” Start Operation by “ Jay Walker” 1998
  • 4. Background Expansion Phase “ Priceline Webhouse Club” Beginning of 2000 Extend Model - Groceries - Gasoline - Used Goods Shut Down!! Oct 2000 Jay Walker Resigned Dec 2000 <ul><li>Unable to deal with major Brands </li></ul><ul><li>Incovenient to pick up </li></ul>Factors
  • 5. Background Reorganization Phase Core Business “ Richard Braddock” New Chairman “ Discount Retail” 2003 – 2004 Extension ** First Annual Profit **
  • 6. Background Boom!! “ International Business” 2004 - Active Hotels Integration 2005 – Booking.com 2007 – Agoda
  • 7. Question1 <ul><li>W hat are the core </li></ul><ul><li>components of Priceline’s </li></ul><ul><li>business model? </li></ul>
  • 8. Components of Business Model <ul><li>Value Proposition </li></ul><ul><li>Revenue Model </li></ul><ul><li>Market Opportunity </li></ul><ul><li>Competitive Environment </li></ul><ul><li>Competitive Advantage </li></ul><ul><li>Market Strategy </li></ul><ul><li>Organizational Development </li></ul><ul><li>Management Team </li></ul>
  • 9. Components of Business Model <ul><li>Consumer Side </li></ul><ul><li>Low Cost with some </li></ul><ul><li>additional conditions </li></ul><ul><li>Vendor Side </li></ul><ul><li>New channel for </li></ul><ul><li>excessed products </li></ul>1) Value Proposition
  • 10. Components of Business Model <ul><li>Transaction Fee </li></ul><ul><li>Booking & Handling Fee </li></ul><ul><li>Adaptive Marketing Program - Adaptive Promotion </li></ul><ul><li>- Adaptive Cross Selling </li></ul><ul><li>Sales </li></ul><ul><li>Gain between </li></ul><ul><li>the offer price and </li></ul><ul><li>the vendor price </li></ul>2) Revenue Model
  • 11. Components of Business Model <ul><li>Marketspace </li></ul><ul><li>Travel Service Industry </li></ul><ul><li>started from domestic (U.S.) </li></ul><ul><li>1978–2007 => $253.29 billion </li></ul><ul><li>Realistic Market </li></ul><ul><li>Consumer side: </li></ul><ul><li>Budget Concern </li></ul><ul><li>Vendor side: </li></ul><ul><li>Excessed Demand Product </li></ul><ul><li>Rapid Aging </li></ul>3) Market Opportunity
  • 12. Components of Business Model <ul><li>Direct Competitors </li></ul><ul><li>Travel Agencies </li></ul><ul><li>e.g. expedia.com, </li></ul><ul><li>orbitz.com </li></ul><ul><li>Vendor itself !!! </li></ul><ul><li>Travel Industry </li></ul><ul><li>High-Revenue </li></ul><ul><li>Attractive </li></ul><ul><li>Price-War </li></ul><ul><li>Information-War </li></ul><ul><li>Indirect </li></ul><ul><li>Competitors </li></ul><ul><li>Online Market Maker </li></ul><ul><li>e.g. eBay.com, Amezon.com </li></ul>High Competitive Segment !! 4) Competitive Environment
  • 13. Components of Business Model Lower Price from “Reverse Auction” Fast Response, Reliability & Standard First Mover Advantage & Brand Product Mix 5) Competitive Advantages
  • 14. Components of Business Model <ul><li>New Trading Model “Name Your Own Price ® ” </li></ul><ul><li>Brand Ambassador “William Shatner” </li></ul><ul><li>Published Price Model “No One Deals Like We Do ® ” </li></ul>6) strategies <ul><ul><ul><ul><ul><li>International Expansion </li></ul></ul></ul></ul></ul>
  • 15. Components of Business Model <ul><li>O rganization </li></ul><ul><li>Development </li></ul><ul><li>& </li></ul><ul><li>M anagement </li></ul><ul><li>Team </li></ul>
  • 16. Core Components of Priceline.com <ul><li>V alue Proposition </li></ul><ul><li>R evenue Model </li></ul><ul><li>C ompetitive A dvantage </li></ul>M arket C reator
  • 17. Question 2 <ul><li>D o you think Priceline will </li></ul><ul><li>ultimately succeed or fall? </li></ul><ul><li>Why? </li></ul>
  • 18. Question 2 Success Factors <ul><li>Focus on Core Business </li></ul><ul><ul><li>Travel Reservations </li></ul></ul><ul><li>Financial Controls </li></ul><ul><li>Extent Inter-Market </li></ul><ul><li>Pricing Strategy </li></ul><ul><ul><li>Discount fee </li></ul></ul><ul><li>Flexible Services </li></ul><ul><ul><li>Specific Information </li></ul></ul><ul><ul><li>Group Services </li></ul></ul><ul><li>Technology Channel </li></ul><ul><ul><li>I-Phone </li></ul></ul><ul><li>Uncertaint y </li></ul><ul><ul><li>2 Sides Effects </li></ul></ul><ul><li>Direct & Indirect </li></ul><ul><li>Competitors </li></ul><ul><ul><li>Price War </li></ul></ul><ul><li>Inflexible Services </li></ul><ul><li>Digital/Internet </li></ul><ul><li>Effect </li></ul><ul><ul><li>Brand Image </li></ul></ul>Risk Factors
  • 19. Question 3 H ow has Priceline (and similar online services) impacted the travel services industry?
  • 20. Question 3 Customer Effects <ul><li>Positive Effects </li></ul><ul><ul><li>Increase Customer </li></ul></ul><ul><ul><li>Easy/Direct to Target </li></ul></ul><ul><li>Negative Effects </li></ul><ul><ul><li>Price War </li></ul></ul><ul><ul><li>Value vs. Volume </li></ul></ul>Entrepreneur Effects <ul><li>Positive Effects </li></ul><ul><ul><li>Matching Demand </li></ul></ul><ul><ul><ul><li>Price/Budget </li></ul></ul></ul><ul><ul><li>Cost Savings </li></ul></ul><ul><ul><li>Almost Perfect Information </li></ul></ul><ul><li>Negative Effects </li></ul><ul><ul><li>Limitation </li></ul></ul><ul><ul><ul><li>Acceptable Prices </li></ul></ul></ul><ul><ul><ul><li>Comparable Prices </li></ul></ul></ul>
  • 21. Question 4 <ul><li>F ollow up on developments at Priceline since Sep 2008 when this case study was prepared. </li></ul><ul><ul><li>Has its business model and/or strategy changed at all, </li></ul></ul><ul><ul><li>and if so, how? </li></ul></ul><ul><ul><li>Who are its strongest competitors? </li></ul></ul><ul><ul><li>Is it profitable or operating at a loss? </li></ul></ul>
  • 22. Question 4 <ul><ul><li>H as its business model and/or strategy changed at all, </li></ul></ul><ul><ul><li>and if so, how? </li></ul></ul>
  • 23. Iphone Application
  • 24. Priceline Competitor <ul><ul><li>Who are its strongest competitors? </li></ul></ul>
  • 25. Question 4 <ul><ul><li>Who are its strongest competitors? </li></ul></ul>
  • 26. Question 4 <ul><ul><li>Is it profitable or operating at a loss? </li></ul></ul>
  • 27. Question 4 <ul><ul><li>Is it profitable or operating at a loss? </li></ul></ul>
  • 28. Class Discussion <ul><li>Q & A </li></ul>

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