Priceline keeps growing its global hotel business and stealing market share.
In releasing the company’s first quarter 2010 financial results, Priceline CEO Jeffery Boyd notes that the numbers of its competitors — namely Expedia Inc. and Orbitz Worldwide – were good, but Priceline is happy to take market share even as it grows from a higher base.
In the quarter, Priceline’s global room nights grew 56.8% to roughly 20 million while Expedia’s room nights climbed 18% to around 16 million.
Meanwhile, Orbitz, which showed strength from its ebookers unit, saw its hotel room nights grow 13%.
Without disclosing hard numbers, Boyd says Priceline’s Agoda business is growing at a faster rate than Priceline’s overall business and the Booking.com unit is notching “impressive” growth rates in Asia.
Priceline’s strategy is to connect to independent properties with its retail model and to use Priceline’s market power to drive demand.
Another element, Boyd explains, is to share inventory among the various brands.
Thus, Priceline.com uses Booking.com inventory from Europe, and Agoda has been selling Booking.com inventory in Asia, he says.
Sharing the inventory is only part of the story, Boyd says, adding that the next stage is to optimize how that inventory is displayed.
Priceline constantly works on optimizing these displays “to get it just right,” and the results will be beneficial to the company’s financial results over time, Boyd says.
For the first quarter, Priceline saw its profits increase 115.3% $53.9 million, compared to Q1 2009, on revenue of $584 million, a jump of 26.5%.
The company has seen some disruption in the second quarter, however.
The ash cloud in Europe led to $50 million in lost gross bookings from hotel cancellations, officials said.
And, the turmoil in Bangkok and other Thailand destinations has had a “significant impact,” Boyd added.