January 9, 2004 -- Priceline claims to often have the cheapest airfares and hotels, but the truth in their claim is difficult to figure out. Unlike Hotwire, Expedia and other online travel agencies, Priceline doesn't make their prices publicly available. Their true value has remained shrouded in mystery -- until now.
Enter Consumers Union, the clean-as-a-whistle consumer advocacy organization that publishes Consumer Reports. Their Web-based arm, Consumer WebWatch (www.consumerwebwatch.org) spent $38,000 buying hotels, car rentals and airline tickets from Priceline and Hotwire. Consumer WebWatch compared Priceline's and Hotwire's prices to Expedia, Travelocity, Orbitz, Quikbook and the SABRE computer system used by travel agents. They searched on a variety of routes, trip lengths and advance booking periods.
Their conclusion: Priceline did have the lowest airfares and car rental rates the most often, and came a close second to Hotwire with hotels. But you still have to shop around. Priceline was only cheapest 44 percent of the time with airfares and 40 percent of the time with hotels. (Together, though, Priceline and Hotwire provided 83 percent of the lowest hotel rates.)
Let us repeat this again, in bold type: There is no one site that always offers either the lowest hotel rates or airfares.
In general, Priceline and Hotwire offered airfare prices about 20 percent lower than other sites, when they had the best fares. That doesn't surprise us. We were much more surprised by the result that Priceline only came in with hotel prices 16 percent below other sites when they had the lowest rates Hotwire had prices 24 percent below competitors', when they won tests. That doesn't jibe with our personal evidence of getting $150 rooms for $60 on Priceline, but we didn't spend $38,000 studying the issue, so we'll defer to Consumers Union.
In general, opaque fares and rates beat non-opaque rates, the report says. Fans of travel agents should note that the poorest performer by far was Sabre, the travel agency system. If you use a travel agent, make sure he or she is checking Web fares, consolidator fares and other options, and not just punching a few details into a Sabre terminal.
Of the non-opaque sites, Consumer WebWatch found that Quikbook (www.quikbook.com) was especially good for hotels. Quikbook's performance at providing the lowest hotel rates was "comfortably ahead" of other non-opaque sites, according to the Consumers Union report. We agree; in the limited set of cities Quikbook serves, we've generally found them to be a great resource for low hotel rates.
For airfares, Consumer WebWatch picked Expedia (www.expedia.com) as the non-opaque site with the lowest rates the most often. Expedia had the lowest airfares 36 percent of the time in CWW's test, followed by Travelocity with 27 percent of the lowest rates. Once more, you have to shop around.
To read the full Consumer WebWatch report and their recommendations for consumers, head over to www.consumerwebwatch.org/news/opaque/TOC.htm. One recommendation we'd like to add: if you're considering bidding on Priceline, consult BiddingForTravel (www.biddingfortravel.com) to find past winning bids and advice on how to play Priceline's games. The tough-love crowd at BfT forces you to shop around and to pay attention to Priceline's policies -- exactly what Consumers Union advises.
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