You might think Priceline (PCLN) and Expedia (EXPE) are playing a chess game with one another, but in reality, Expedia is only reacting to Priceline, which is playing an entirely different game. Priceline buying HotelNinjas and Buuteeq shows they are on a different path—a path that offers hoteliers a bunch of solutions to better serve their customers, in addition to their web services. The hotel OTA sector might be consolidating, but the hotel software as a service (SaaS) industry is booming. API integrations have moved hotels forward, past the days of GDS. Fees per booking are dwindling, and flat services with more options are becoming common. Priceline is building a suite of services that its customers can use, aggressively pricing and promoting those services to boost their customers' performance. It's quite brilliant, I'd say.
Siteminder
If the hotel side of GDS is dying, an autopsy might see Siteminder as its cause of death. Sure, there are other strong channel managers out there, such as RateTiger and RezGain, but Siteminder has been building strong traction and is easily on the way to becoming the world leader. Their flat fee, easy-to-use service already works with all of Priceline's channels and Buuteeq. A channel manager could be the next step for Priceline, and Siteminder is the first that comes to mind.
PriceMatch
For hotels today, managing revenue is just as important as managing housekeeping. Hotels hire a revenue manager and even a team to tackle this task. A properly managed revenue strategy can boost revenues by 7%, which can easily cover the costs involved. PriceMatch is the brainchild of some French geniuses. They have steadily gained traction and customers over time and are now giving the large revenue management systems such as IDeaS and Duetto a run for their money. Priceline, incorporating the power of PriceMatch, can be a powerful tool to help hoteliers boost their performance, and the benefits can far outweigh the cons, as PriceMatch increases the bookings of Priceline's OTA competitors.
OTA Insight
Now, if Priceline were to consider a revenue management system, then why not go a step further and offer OTA Insight? These guys really help hotels predict where bookings come from and when, by using benchmark analytics, whereas hotel revenue management systems rely mostly on internal analytics. This can really help with a hotel's pace and performance, making it right up Priceline's alley. Hopefully, someday OTA Insight will offer its service to hostels.
Triptease
Triptease creates a widget that allows visitors to search other sites for the price of a hotel they are about to book on the direct site. The premise is that hoteliers want customers to book direct, and by removing the other steps of research, they can reduce booking abandonment and increase direct bookings. Other hotels, such as Shire Hotels in the UK, do just this, and it has proven to double direct bookings year over year. Priceline can use this to push direct bookings on their direct booking platform. However, I do not see Priceline buying Triptease; if anything, they will create a widget pulling from their Kayak database, which will be equally valuable and at least keep some of the revenue within the Priceline family if the parity is off and the visitor books elsewhere. These are all great tools. Hopefully, someday more of them will be available to hostels.