Case Study: Priceline.com - Solve Fantasy Bidding Problem

Priceline.com

Priceline.com is one of the pioneers of the internet. Well-known for the ‘name your price’ Web offering, Priceline.com turned to Linescale for help in responding to a decline in customer satisfaction that was threatening their core business.

Taking Priceline.com at their word, customers were first testing the system by making a “fantasy”, or unrealistically low offer. The airlines’ rules do not permit a second offer since that would allow unacceptable probing of prices. Linescale identified the problem through its diagnostic capabilities and worked through a development process with Priceline.com to create the best solution. When fantasy offers were proposed Priceline.com now identified them as fantasy offers and then informed the customer that while it was willing to submit their offer, the chances of it being accepted would be extremely low. Priceline.com then recommended a higher price range to the customer. Because the system now demonstrated that it was intelligent and recognized their offer, customers were reassured and submitted valid offers. With this important feedback mechanism instituted into the Web experience valid or “in range” bids rose driving a dramatic increase in both customer satisfaction and revenue.