Priceline.Com: Name Your Own Price

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Not just Travel but also Rental cars, Hotel bookings, Restaurants market are increasing in the US and International Market, This made Priceline to expand in these business. One more fact was crucial for this expansion strategy of Priceline; Increasing use of Online means to book or purchase the Travel, Hotel and rental car services in International market.

To mark their presence in International market, Priceline used Grow-by-acquisition strategy. It started acquiring various companies deemed fit to expand in different sector and different category, at first in 2004 they acquired Booking.com, a Dutch based company to serve the European hotel market and to serve the Asian market they acquired Agoda, a Bangkok based hotel Reservation Company (Which started selling Flight service later). In 2010 they acquired TravelJigsaw, a multinational rental car service to enter the rental car market outside US. They added Kayak in their list in 2012, which was a little different than their previous acquisitions, because Kayak doesn’t earn revenue through selling of travel product but through travel lead generation with customer and advertising. Their recent acquisition was to expand in Restaurant Business for which they acquired OpenTable, an online real time Restaurant reservation service.

Grow-by-acquisition Strategy is proving to be successful for Priceline to date; one such example is in 2008, 58.4% of their bookings were coming from Booking.com. In 2015 the total revenue of Priceline group was $9.22 Billion in which hotel booking contribution was approx. $8.52 Billion. With the average growth rate of 21% company forecasted $10.52 billion in revenue at the year end of 2016.

These numbers suggests that companies Grow-by-acquisition strategy is helping compete internationally, although most of the revenue is coming from hotel business they have yet to succeed in other market they are trying to enter like restaurant one.