Priceline Promises Better Connections for Wary Users

In a bid to refocus on its core travel business, Priceline(Nasdaq: PCLN) announced Wednesday that it had enhanced its service to offer customers more convenient itineraries and shorter connection times between flights.

The “name-your-price” e-tailer also said that it had hired travel expert Pauline Frommer as a special advisor to evaluate the company’s services.

Priceline said the maximum layover time for each half of a customer’s trip is now three hours for trips within the U.S., but that following the upgrade, 85 percent of those layovers will be be two hours or less.

Morningstar.com analyst David Kathman told the E-Commerce Times that although Priceline’s changes are positive, “they need to do a lot more.”

Bad Flight

Other changes announced by the company include a faster response time and a shorter online order form. The new response times, according to the company, will be in most instances 15 minutes or less.

“As we announced earlier this month, we are listening closely to our customers in order to make meaningful improvements to Priceline.com,” Priceline president and chief executive officer Daniel H. Schulman said.

Kathman said that addressing consumer complaints is a big step for Priceline, adding that one of the big problems that consumers had with the company is that it does not “treat you like a human being.”

However, even with improved customer service, Priceline’s market is still “inherently limited” to college students and other people who have a lot of extra time, but not a lot of extra money, according to Kathman, because the tickets Priceline sells call for travel at off-peak times with several layovers.

Puffed Up

Priceline’s “name-your-price” business model allows customers to specify how much they are willing to pay for a ticket. However, the drawback to using the service is that customers cannot specify what times they want to fly, nor can they limit the number of connecting flights.

Additionally, once consumers submit a request for an airline ticket, they are obligated to purchase it at their stated price, whether or not the flight meets with their approval.

The requirement that customers commit to purchasing a ticket before they know the details of their itinerary “turns a lot of people off,” according to Kathman.

Hot Air

Wednesday’s announcement is not the only sign that Priceline is listening to its critics. In December, the company was reinstated in the Connecticut Better Business Bureau, after being expelled in September.

The BBB had reportedly received more than 300 complaints about Priceline, ranging from misrepresentation of its services to failure to make promised refunds.

Customer complaints also have sparked an investigation by Connecticut Attorney General Richard Blumenthal.

Silver Lining

The good news for Priceline is that according to analysts, the company is not going to run out of money anytime soon.

Priceline closed Wednesday at US$2.66, down 31 cents. However, during the past year Priceline has traded as high as $104.25.

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