Priceline Profiting From the Procrastinator: CEO


By Margo D. Beller, Special to CNBC.com

NEW YORK ( CNBC) -- Priceline ( PCLN) is profiting from the old adage that good things come to those who wait.

Its Booking.com Tonight application, launched last week, is picking up a lot of traffic from mobile-savvy travelers who land in an airport and only then order a rental car or a hotel room, CEO Jeffery Boyd told CNBC's "Squawk on the Street" Thursday.

According to Boyd, Priceline has noticed an interesting pattern: The majority of U.S. reservations were made the same day and usually within a couple of hours of checking into a nearby hotel or picking up a car from the rental counter, at which point travelers can get discounts of up to 50% from Priceline suppliers.

"Being able to give our suppliers, the hotel and the rental car companies in particular, information about where a customer is at a given point in time allows them to hone their discounting strategy and capture customers making a last-minute booking," he pointed out.

More from CNBC
Tips For Traveling Solo
Burger King Takes to the Road to Promote New Menu
In the 'Cockpit' of the F-35 Joint Strike Fighter

So today's travelers increasingly are "starting to defer their decision-making, knowing they'll be able to get a great deal at the last minute," Boyd said.

For Priceline.com and other travel booking websites such as Orbitz ( OWW), which has spent four years migrating to a single-technology platform, mobile is a cheaper way of drawing customers than operating a website or a travel agency.

"It may cost a little money to get the app out into the marketplace and to increase your downloads, but once you've got it out there you really have a customer at a very efficient acquisition cost for a long period of time," Boyd said.

Priceline shares are up 57% year-to-date, and a lot of investors look to the company's hotel bookings in Europe for clues on that economy. Boyd said that while Europe is still an important part of the business, North America, South America, and Asia are actually larger markets, part of Priceline's global strategy investors should look at to "understand the whole picture."

Interestingly, he said the desire for big discounts is more of an American phenomenon. Overseas, he said, the focus is more on having a wide selection. That's why Priceline's online offerings have different brand names and strategies, depending on location.

Speaking of America, could former spokesman William Shatner be making a comeback? Killed off -- metaphorically -- after Priceline shifted from its "Negotiator" strategy to focus on its "Procrastinator" strategy, Boyd wouldn't say one way or the other whether the "Star Trek" and "Boston Legal" star might be back.

"We'll have to wait and see what happens with Mr. Shatner," Boyd said, smiling.

--Written by Margo D. Beller at CNBC

CNBC is a world leader in business news, providing real-time financial market coverage and business information.

More from Stocks

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Neel Kashkari: The Heart of Our Financial System Is More Radioactive Than Ever

Neel Kashkari: The Heart of Our Financial System Is More Radioactive Than Ever

Finding Stocks Right for You: Cramer's 'Mad Money' Recap (Friday 8/25/18)

Finding Stocks Right for You: Cramer's 'Mad Money' Recap (Friday 8/25/18)

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Week Ahead: Wall Street Looks to Jobs Report as North Korea Meeting Less Certain

Week Ahead: Wall Street Looks to Jobs Report as North Korea Meeting Less Certain