Priceline.com is an Internet company that pioneered a unique type of e-commerce known as “demand collection system” that enables consumers to use the Internet to save money on a wide range of products and services while enabling sellers to generate incremental revenue. Using a simple and compelling consumer proposition of “name your price,” the consumer is in control of the product they wish to purchase. In the form of individual customer offers guaranteed by a credit card for a particular product or service at a price set by the customer and communicate that demand directly to the participating sellers or to their private databases. The company works by allowing the consumers to agree to hold their offers open for a specified period of time to enable priceline.com to fulfill their offers from inventory provided by participating sellers. Once fulfilled, offers generally cannot be canceled. By requiring consumers to be flexible with respect to brands, sellers and/or product features, the company enables sellers to generate incremental revenue without disrupting their existing distribution channels or retail pricing structures.
The company is grounded on the assumption of “rational self-interest.” In other words, since individuals make rational decisions to achieve the greatest satisfaction or the maximum fulfillment of their goals, Priceline.com has now revolutionized the market industry. By their ‘name and lock your price” strategy, more and more consumers have been able to maximize their satisfaction on differentiated products. The consumers want to spend their incomes to get the greatest benefit from the goods and services they can afford. Priceline.com helps them to achieve their goals. Since the inception of this internet-based company, millions of consumers were able to afford more with less expenditure on their goods. In addition, rational behavior varies among every individual because individual preferences, circumstances, and available information differ. Priceline.com offers various or “differentiated goods and services” in a broad range of products to purchase from.
“E-Commerce Pioneer Priceline.com Sells 20,000 Leisure Airline Tickets In Six Weeks.” As ticket sales accelerated, priceline.com has become one of the nation’s top 10 most-visited commerce Web sites. In it’s first six weeks of operation, priceline.com sold more than 10,000 tickets. Sales have been monumental with a recorded 1,000-plus-ticket sale in a single day. Sales with an average of one ticket sold every 70 seconds. With its leisure airline ticket service, priceline.com collects consumer demand and helps airlines fill thousands of empty seats every week on their domestic and international flights. Consumers simply tell priceline.com the location, the date they want to travel, the price they’re ready to pay and the major credit card they’ll use to guarantee their request. Consumers then receive an answer from priceline.com in one...